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Facts
The assessee, represented by her legal heir, filed an appeal against an order of the CIT(A) which upheld the Assessing Officer's order. The assessee had expired during the pendency of the appeal before the CIT(A), and the CIT(A) passed the order in the name of the deceased assessee. The appeal before the ITAT was filed with a delay of 192 days due to the demise of the assessee and the illiteracy of her legal heir.
Held
The Tribunal condoned the delay in filing the appeal, citing the death of the assessee and the illiteracy of the legal heir. The Tribunal held that the CIT(A)'s order passed in the name of the deceased assessee was invalid and could not be sustained. The matter was set aside to the CIT(A) for re-adjudication after impleading the legal heir.
Key Issues
Whether the CIT(A) order passed in the name of a deceased assessee is valid. Whether the delay in filing the appeal warrants condonation.
Sections Cited
147, 144, 2(47)(v), 143(2), 148
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, VISAKHAPATNAM “DIVISION” BENCH, VISAKHAPATNAM
Before: SHRI RAVISH SOOD, HON’BLE & SHRI OMKARESHWAR CHIDARA, HON’BLE
आदेश /O R D E R
PER RAVISH SOOD, JM:
The present appeal filed by the assessee (since deceased) through her legal heir is directed against the order passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, dated 26.12.2024, which in turn arises from I.T.A.No.541/VIZ/2025 Late Rama Kumari Munna the order passed by the Assessing Officer (for short, “A.O”) under section 147 r.w.s. 144 of the Income-Tax Act, 1961 (for short, “the Act”), dated 31.03.2022 for the Assessment Year 2016-17. The assessee (through legal heir) has assailed the impugned order on the following grounds of appeal before us:
1. That, on the facts and in the circumstances of the case and in law, the order passed by the Assessing Officer u/s 147 r.w.s. 144 of the Income- tax Act, 1961, dated 31.03.2022, and upheld by the Learned Commissioner of Income Tax (Appeals), NFAC, vide order u/s 250 dated 26.12.2024, is erroneous, contrary to the provisions of the Act, and against the facts of the case.
2. The Learned CIT(A) and the lower authorities have erred in holding that the Joint Development Agreement (JDA) dated 18.03.2016 constituted a transfer within the meaning of section 2(47)(v) of the Income-tax Act, 1961, without properly appreciating the following: (i) That the JDA did not effectuate any identifiable transfer of property, inasmuch as there was no individual demarcation or allocation of flat numbers, parking areas, or common areas to the appellant; (ii) That no possession enabling the developer to exercise rights of ownership or effect sale was delivered; the land was handed over only for the limited purpose of construction, as evident from the express covenants of the JDA dated 18.03.2016; (iii) That the JDA itself contemplated execution of a Supplementary Deed, which was duly executed on 12.09.2017, after which alone the plans were finalised and allocation of constructed area took place, thereby crystallising the rights of the respective parties; (iv) That the authorities below failed to consider binding and persuasive judicial precedents, which have consistently held that mere execution of a development agreement, without delivery of complete possession and without crystallisation of rights, does not amount to a transfer exigible to capital gains tax in the year of such agreement.
3. The Learned CIT(A) has further failed to adjudicate the ground relating to non-issuance of mandatory notice u/s 143(2) of the Income-tax Act, which vitiates the assessment proceedings in law.
4. In view of the above grounds, and such other grounds as may be urged at the time of hearing, the appellant prays that the impugned order of the Ld. CIT(A), NFAC, dated 26.12.2024, be quashed and the additions made by the Assessing Officer be deleted.”
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I.T.A.No.541/VIZ/2025 Late Rama Kumari Munna 2. Shorn off unnecessary details, the income of the assessee was assessed by the A.O vide his order passed under section 147 r.w.s. 144 of the Act, dated 31.03.2022, determining her income at Rs.93,47,704/-.
Aggrieved, the assessee assailed the impugned assessment order before the CIT(A), who vide his order dated 26.12.2024 dismissed the same both on the legal issues raised by the assessee regarding the validity of the jurisdiction assumed by the A.O for initiating the re-assessment proceedings vide notice issued under section 148 of the Act dated 29.03.2021, as well as on the merits advanced regarding the addition of Rs.93,47,704/- made by the A.O under the head “Long Term Capital Gains” (for short, “LTCG”).
The legal heir of the assessee (since deceased) has assailed the impugned order passed by the CIT(A) dated 26.12.2024 before us.
We have heard the Learned Authorized Representatives of both parties, perused the orders of the authorities below and the material available on record.
Shri C. Subrahmanyam, CA, the learned Authorized Representative (for short, “Ld.AR”) for the assessee (through legal heir), at the threshold of hearing of the appeal, submitted that the appeal involved a delay of 192 days. Elaborating on the reasons leading to the delay, the Ld. AR submitted that as the assessee had much prior to the disposal of the appeal by the CIT(A) unfortunately expired on 02.07.2022, and her legal heir (husband) who, being an illiterate agriculturist was oblivion of the proceedings as well as the disposal of the appeal by the CIT(A), thus the same had resulted to the delay
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I.T.A.No.541/VIZ/2025 Late Rama Kumari Munna in filing of the present appeal. The Ld. AR submitted that it was only when Shri Shivayya Munna, i.e., husband of the assessee (since deceased), was visited by an Inspector of the Income Tax Department that he had gathered about the outstanding demand payable by his wife (since deceased). Carrying his contention further, the Ld. AR submitted that the Shri Shivayya Munna (supra), on learning about the outstanding demand in the case of the assessee (since deceased), had approached an Income Tax Practitioner (for short, “ITP”) and, as per his advice, had filed the present appeal, which, by the time, was delayed by 190 days. The Ld.AR submitted that as the delay in filing of the present appeal had crept in primarily for two-fold reasons viz., (i) the unfortunate demise of the assessee; and (ii). illiteracy of the assessee’s legal heir, i.e., husband, who had remained unaware of the appellate proceedings and the dismissal of the appeal, therefore, the same not being backed by any lackadaisical approach or conduct on the part of the said legal heir, in all fairness and in the interest of justice, be condoned.
Per contra, Sri K. Prasad, Learned Senior Departmental Representative (for short, “Ld. DR”) objected to the seeking of the condonation of the delay of 192 days by the legal heir of the assessee (since deceased). It was submitted by him that as the delay involved is inordinate, therefore, the same does not merit condonation.
We have given thoughtful consideration to the contentions advanced by the Ld.Authorized Representatives of both parties regarding the delay involved in filing of the present appeal before us, and are of the firm conviction that, as there are justifiable reasons leading to the impugned delay viz., (i) the unfortunate demise of the assessee on 02.07.2022; and (ii). illiteracy of the assessee’s legal heir, i.e, husband, who had Page. No 4
I.T.A.No.541/VIZ/2025 Late Rama Kumari Munna remained oblivion both about the ongoing appellate proceedings followed by the dismissal of the appeal, therefore, in our view, the said delay merits to be condoned. Our aforesaid view that a liberal approach should be adopted while considering an application filed by an appellant seeking condonation of the delay involved in filing the same is supported by the judgment of the Hon'ble Supreme Court in the case of Vidya Shankar Jaiswal vs. The Income Tax Officer, Ward-2, Ambikapur in Special Leave Petition (Civil) Nos. 26310-26311/2024, dated 31st January, 2025, wherein the Hon'ble Apex Court while setting aside the order of the Hon'ble High Court of Chhattisgarh, which had approved the declining of the condonation of delay of 166 days by the Income Tax Appellate Tribunal, Raipur Bench, had observed, that a justice oriented and liberal approach should be adopted while considering the application filed by an appellant seeking condonation of the delay involved in the appeal. We thus, in terms of our aforesaid observation, condone the delay of 192 days involved in filing the present appeal by the assessee (through legal heir) before us.
Coming to the core issue involved in the present appeal, the Ld.AR submitted that the order passed by the CIT(A) suffers from a serious infirmity. Elaborating on his contention, the Ld.AR submitted that though the assessee viz., Smt. Rama Kumari Munna had unfortunately expired on 02.07.2022 i.e., during the course of the pendency of proceedings before the CIT(A), which had culminated vide an order dated 26.12.2024, but the said impugned order had been passed by the CIT(A) in the name of the assessee (since deceased) viz., “Rama Kumari Munna, 3-173-3 Kunchanapalli, Guntur – 522501, Andhra Pradesh, India”. The Ld.AR submitted that as the impugned
Page. No 5
I.T.A.No.541/VIZ/2025 Late Rama Kumari Munna order has been passed by the CIT(A) in the name of the deceased assessee, therefore, the same cannot be sustained and is liable to be set-aside.
Per contra, Sri K. Prasad, Learned Senior Department Representative (for short “Ld. DR”) did not object to the aforesaid contention advanced by the assessee’s counsel regarding the validity of the CIT(A) order that was passed in the name of the deceased assessee.
We have given thoughtful consideration to the contentions advanced by the learned Authorized Representative of both parties in the backdrop of the orders of the authorities below and the material available on record.
Admittedly, it is a matter of fact based on the copy of the “death certificate” of the assessee filed by the Ld. AR before us, which reveals that the assessee had expired way back on 02.07.2022, i.e., during the pendency of the proceedings before the CIT(A), who had disposed of the appeal vide his order dated 26.12.2024. In our view, as the legal heir of the assessee (since deceased) had failed to bring to the notice of the CIT(A) the factum of death of the assessee on 02.07.2022, therefore, for the said reason, the first appellate authority had failed to seek the impleading of the legal heir on record.
Be that as it may, we are of the firm conviction that, as the assessee had expired on 02.07.2022, therefore, the order passed by the CIT(A) dated 26.12.2024 in her name viz., “Rama Kumari Munna, 3-173-3 Kunchanapalli, Guntur – 522501, Andhra Pradesh, India” being non-est in the eyes of law cannot be sustained and is liable to be set-aside.
Page. No 6
I.T.A.No.541/VIZ/2025 Late Rama Kumari Munna 14. We, thus, in terms of our aforesaid deliberations, set-aside the order passed by the CIT(A) to his file with a direction to re-adjudicate the appeal after impleading the legal heir/heirs on record. Needless to say, the Ld. CIT(A) shall in the course of the set-aside proceeding, afford a reasonable opportunity of being heard to the legal heir/heirs of the assessee.
As we have set-aside the matter to the file of the CIT(A) for fresh adjudication in terms of our aforesaid observations, therefore, we refrain from adverting to and adjudicating the other issues based on which the impugned order has been assailed before us.
Resultantly, the appeal filed by the assessee (since deceased) is allowed for statistical purposes in terms of our aforesaid observations.
Order pronounced in the open court on 18th February, 2026.