Late Asha Rani Sood, New Delhi v. ACIT, New Delhi

ITA 4756/DEL/2010 | 2004-2005
Pronouncement Date: 28-07-2011 | Result: Allowed

Appeal Details

RSA Number 475620114 RSA 2010
Assessee PAN AOCPS7718H
Bench Delhi
Appeal Number ITA 4756/DEL/2010
Duration Of Justice 8 month(s) 27 day(s)
Appellant Late Asha Rani Sood, New Delhi
Respondent ACIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 28-07-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 28-07-2011
Date Of Final Hearing 28-07-2011
Next Hearing Date 28-07-2011
Assessment Year 2004-2005
Appeal Filed On 01-11-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A NEW DELHI BEFORE SHRI R.P. TOLANI AND SHRI SHAMIM YAHYA ITA NO. 4756/DEL/10 ASSTT. YR: 2004-05 ASHA RANI SOOD VS. ACIT CIR. 27(1) THROUGH L/S DEEPAK RAI NEW DELHI. A-9 KIRTI NAGAR NEW DELHI. PAN/ GIR NO.AOCPS7718H ( APPELLANT ) ( RESPONDENT ) APPELLANT BY : SHRI K. SAMPATH ADV. RESPONDENT BY : MS. ANUSHA KHURANA SR. DR O R D E R PER R.P. TOLANI J.M: : THIS IS ASSESSEES APPEAL AGAINST CIT(A)S ORDER D ATED 23-8-2010 RELATING TO A.Y. 2004-05. FOLLOWING GROUNDS HAVE BE EN RAISED: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF CASE AN D IN LAW THE LEARNED CIT(APPEALS) XXIV GROSSLY ERRED IN NOT QUASHING THE ORDER AND INSTEAD CONFIRMING THE ASSESSMENT FRA MED ON THE DECEASED PERSON BY THE LEARNED ACIT CIRCLE 27(1) N EW DELHI FRAMED U/S 147/143(3) OF THE ACT. THE ORDER OF THE LEARNED ACIT CIRCLE 27(1) NEW DELHI NEEDED TO BE QUASHED B Y LEARNED CIT(APPEALS) XXIV AS BAD IN LAW. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF CASE AND IN LAW THE LEARNED CIT(APPEALS) XXIV GROSSLY ERRED IN CONF IRMING THE ADDITION OF RS. 11 35 360/- ON ACCOUNT OF ALLEGED U NDISCLOSED INVESTMENT IN THE CONSTRUCTION OF HOUSE. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF CASE AND IN LAW THE LEARNED CIT(APPEALS) XXIV GROSSLY ERRED IN MAKI NG ADDITION OF RS. 4 00 000/- ON ACCOUNT OF UNDISCLOSE D INVESTMENT IN INSTALLATION OF LIFT ADDITION FOR WHICH WAS NOT MADE BY THE AO. 2 2. BRIEF FACTS ARE: (1) FOR THE ASSESSMENT YEAR IN QUESTION I.E. A.Y. 2004- 05 THE ASSESSEE FILED HER RETURN OF INCOME ON 1-11-2004 WHICH WAS PROCESSED U/S 143(1) OF THE I.T. ACT. BESIDES OTHER ASSETS SHE O WNED A RESIDENTIAL PROPERTY NO. A-9 KIRTINAGAR NEW DELHI. THE ASSESS EE WAS FILING HER RETURNS OF INCOME SHOWING RENT AND INTEREST AS MAIN SOURCES OF INCOME. ASSESSEE EXPIRED ON 9-8-2008. (2) THE ASSESSEE RECEIVED NOTICE DATED 27-3-2008 FOR R EOPENING OF ASSESSMENT U/S 148 OF THE I.T. ACT FOR A.Y. 2001-0 2. DURING THE PENDENCY OF REASSESSMENT PROCEEDINGS FOR A.Y. 2001- 02 THE ASSESSEE EXPIRED ON 9-8-2008 AND HER LEGAL HEIR INFORMED TH E AO ABOUT HER DEMISE VIDE LETTER DATED 11-11-2008. (3) DESPITE KNOWLEDGE ABOUT ASSESSEES DEATH DURING PRO CEEDINGS FOR A.Y. 2001-02 THE AO ISSUED NOTICE U/S 148 FOR A.Y. 2004-05 I.E. IMPUGNED ASSESSMENT YEAR ON 16-1-2009. THUS THE NO TICE WAS ISSUED U/S 148 IN THE NAME OF DECEASED AND THE REASSESSMEN T ALSO WAS FRAMED ON A DECEASED ASSESSEE. (4) AGAINST REASSESSMENT ORDER THE LEGAL HEIR OF THE A SSESSEE PREFERRED FIRST APPEAL BEFORE CIT(A) AND BESIDES OTHER GROUND S TOOK THE ISSUE ABOUT SERVICE OF NOTICE U/S 148/143(2) AND COMPLETI ON OF ASSESSMENT ON A DECEASED PERSON. CIT(A) HOWEVER CONSIDERING ALL THE FACTS HELD THAT AO WAS NOT AWARE ABOUT THE FACT OF ASSESSEES DEATH AS LRS DID NOT INFORM AND IT WAS AN ERROR WHICH COULD BE CORRE CTED U/S 292B OF THE ACT BY FOLLOWING OBSERVATIONS: 4.2. IT IS UNDISPUTED FACT THAT THE ASSESSMENT HAS BEEN COMPLETED IN THE NAME OF THE DECEASED PERSON. HOWEV ER ON THE BASIS OF FACTS MENTIONED ABOVE IN PARA 4 IT IS HER EBY HELD THAT IT 3 IS NOTHING BUT AN ERROR WHICH CAN NOT BE TREAT ED AS INVALID IN VIEW OF THE PROVISIONS OF SECTION 292B OF THE ACT A ND FOLLOWING CASE LAWS: CIT VS. ANAIMUGAN TRANSPORT (P) LTD. (MA D) 215 ITR 553 SWARN KANTA VS. CIT (P&H) 176 ITR 291 C.G .G. PANICKER VS. CIT (KER) 237 ITR 443 ITO VS. SHAHID ATIQ L/H OF LAT ATIQUER REHMAN (ITAT DEL) 89 ITD 489 A.K.M GOVINDASWAMY CHETTIAR & ORS. VS. ITO (MAD) 244 ITR 559 AND CIT VS. ROSHAN LAL & ORS. (DEL) 134 ITR 145. TH E AO IS THEREFORE DIRECTED TO DO NEEDFUL TO BRING FULL FAC TS ABOUT THE LEGAL HEIR AND INCORPORATE HIS NAME IN THE ASSESSM ENT ORDER AS PER LAW. AGGRIEVED LEGAL HEIR OF ASSESSEE IS BEFORE US. 3. LEARNED COUNSEL FOR THE ASSESSEE RELIED ON THE R ATIO OF DECISION OF HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. SURESH CHANDRA JAISWAL (2010) 325 ITR 563 (ALL.) HOLDING REASSES SMENT BAD IN LAW BY FOLLOWING OBSERVATIONS: 3. IN THE CASE OF CIT V. SHITAL PRASAD KHARAG PRAS AD [2006] 280 ITR 541 A DIVISION BENCH OF THIS COURT HAS HEL D THAT THE NOTICE CONTEMPLATED UNDER SECTION 148 OF THE INCOME -TAX ACT 1961 IS A JURISDICTIONAL NOTICE AND IS NOT CURABLE UNDER SECTION 292B OF THE ACT IF IT WAS NOT SERVED IN ACCORDANCE WITH THE PROVISIONS OF THE ACT. 4. IN THE PRESENT CASE THE NOTICE UNDER SECTION 14 8 WAS ADDRESSED TO AN ASSESSEE WHO WAS ALREADY DEAD EVEN ON THE DATE OF ISSUE OF NOTICE. THE NOTICE WAS ISSUED ON MARCH 28 1985 WHILE THE ASSESSEE GANGA PRASAD JAISWAL HAD DIED O N MARCH 20 1985. THE NOTICE WAS NOT SERVED UPON THE LEGAL REPRESENTATIVES OF GANGA PRASAD JAISWAL BUT IT WAS SERVED ON ONE KESHAV RAM MUNIM. EVEN THE NAME OF THE DECEASE D ASSESSEE WAS NOT CORRECTLY MENTIONED IN THE NOTICE. THE NOTICE WAS ADDRESSED TO GANGA PRASAD JAISWAL WHILE THE CO RRECT NAME OF THE ASSESSEE WAS GANGA RAM JHAISWAL. 5. FROM THE SIDE OF THE RESPONDENTS A DECISION OF A LEARNED SINGLE JUDGE OF THE CALCUTTA HIGH COURT IN THE CASE OF MULCHAND RAMPURIA V. ITO [2001] 252 ITR 758 HAS BEEN RELIED UPON. 4 6. WE HAVE EXAMINED THE SAID JUDGMENT OF THE CALCUT TA HIGH COURT. HOWEVER WE ARE UNABLE TO AGREE WITH TH E REASONING GIVEN BY THE DIVISION BENCH OF THIS COURT IN THE CASE OF CIT V. SHITAL PRASAD KHARAG PRASAD [2006] 280 IT R 541. 7. ACCORDINGLY THE QUESTION REFERRED IS ANSWERED I N FAVOUR OF THE ASSESSEE AND AGAINST THE DEPARTMENT. 3.1. LEARNED COUNSEL CONTENDS THAT CIT(A)S FINDING THAT AO HAD NO KNOWLEDGE ABOUT THE DEATH OF THE ASSESSEE IS NOT C ORRECT AS DURING THE COURSE OF REASSESSMENT PROCEEDINGS FOR A.Y. 2001-02 A CLEAR NOTICE ABOUT ASSESSEES DEATH WAS GIVEN TO AO. HAVING GIVEN SUCH NOTICE ASSESSEES LEGAL HEIRS CANNOT BE ACCUSED OF NOT INTIMATING THE FACT OF ASSESSEES DEATH EVERY YEAR TO AO. LEGAL HEIRS OF ASSESSEE HAVING DISCHARG ED THEIR OBLIGATION IT WAS THE DUTY OF THE AO TO TAKE NOTICE THEREOF AND P ROCEED IN ACCORDANCE WITH LAW. THE MISTAKE IS NOT CURABLE U/S 292B AS WI THOUT PROPER JURISDICTION REASSESSMENT CANNOT BE MADE 148 NOTICE BEING ON A DECEASED ASSESSEE WAS INVALID. THERE IS NO MISTAKE IN THE NOTICE BUT THE NOTICE ITSELF IS BAD IN LAW WHICH CANNOT BE CURED U/S 292B. WHAT CAN BE CURED I S A MISTAKE IN A PROPER NOTICE AND NOT AN INVALID NOTICE. 4. LEARNED DR RELIED ON THE ORDER OF AO. 5. WE HAVE HEARD RIVAL CONTENTIONS AND HAVE GONE TH ROUGH THE ENTIRE MATERIAL AVAILABLE ON RECORD. IT HAS NOT BEEN DISPU TED THAT ASSESSEES LEGAL HEIRS SUBMITTED INFORMATION TO AO DURING THE COURSE OF REASSESSMENT PROCEEDINGS FOR A.Y. 2001-02. THEREFORE WE ARE UN ABLE TO AGREE THAT AO HAD NO INTIMATION ABOUT THE DEATH OF THE ASSESSEE. THE MISTAKE IN QUESTION IS NOT A PROCEDURAL ERROR BUT IT GOES TO THE JURISDICT ION OF AO. ISSUE HAS BEEN SQUARELY DECIDED BY HONBLE ALLAHABAD HIGH COURT IN THE CASE OF SURESH CHANDRA JAISWAL (SUPRA). LEARNED CIT(A) IN HIS ORDE R HAS RELIED ON VARIOUS ALLAHABAD HIGH COURT JUDGMENTS THE CASE OF SURESH CHANDRA JAISWAL 5 (SUPRA) IS THE LATEST ONE AND SPECIFICALLY DEALS WI TH THE ISSUE ABOUT REASSESSMENT BEING BAD AS NOTICE U/S 148 WAS IN THE NAME OF DECEASED ASSESSEE. HONBLE DELHI HIGH COURTS JUDGMENT IN TH E CASE OF CIT VS. ROSHAN LAL & ORS. (DEL) 134 ITR 145 IS NOT APPLICAB LE TO THE ASSESSEES CASE INASMUCH AS IN THAT CASE THE ASSESSEES L/RS HAD NO T INTIMATED THE AO ABOUT THE ASSESSEES DEATH. BESIDES THE DEATH OF THE ASS ESSEE WAS DURING THE COURSE OF REASSESSMENT PROCEEDINGS WHEREAS IN THIS CASE T HE ASSESSEE DIED BEFORE THE NOTICE U/S 148 ITSELF. IN VIEW THEREOF THE NOT ICE U/S 148 BEING ON A DECEASED ASSESSEE THE SAME IS BAD IN LAW TOGETHER W ITH CONSEQUENT REASSESSMENT PROCEEDINGS. IN VIEW OF ABOVE WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND ALLOW THE GROUND TAKEN IN AS SESSEES APPEAL. 5.1. SINCE THE 148 NOTICE AND REASSESSMENT HAS BEEN HELD AS BAD IN LAW WE NEED NOT GO INTO THE MERITS OF THE ADDITIONS. 6. IN THE RESULT ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 28-07-2011. SD/- SD/- ( SHAMIM YAHYA ) ( R.P. TOLANI ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 28-07-2011. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR 6