Surekha Vs ITO (ITAT Bangalore)
ITAT Bangalore quashes reassessment made on deceased assessee despite legal heir updating portal; terms proceedings Void ab initio
Shri Devaraj (deceased assessee) had not filed return for AY 2015–16. Based on property sale information (₹80 lakhs), AO initiated reassessment proceedings u/s 147 & issued notice u/s 148A(b) on 18.03.2022. Assessment was completed ex parte u/s 147 r.w.s. 144, taxing long-term capital gains. CIT(A) also dismissed appeal ex parte, citing non-response to three notices.
Shri Devaraj had passed away on 19.05.2019, well before reassessment proceedings. His wife, Mrs. Surekha, had Updated legal heir details in the Income Tax portal for both PANs on 29.10.2021 & 18.02.2022.
Tribunal ruled that once the legal heir updates portal, death is deemed to be notified to the department. All proceedings (including reassessment) initiated in the name of the deceased person are null & void in law. AO failed to implead legal representative despite portal being updated.
Relying on ITO v. Smt. Preethi V (Karnataka HC), Savita Kapila v. ACIT (Delhi HC), Mary Gene Gracious v. ITO (Bombay HC) & Lal Chand Verma v. UOI (Delhi HC), to the effect that the proceedings initiated on a dead person cannot be sustained under the provisions of the Act, Reassessment proceedings initiated on the dead person & the consequential assessment order was made on the dead person was held as void ab initio. Orders of AO & CIT(A) quashed as being passed against a deceased person despite proper portal update by legal heir.
