Lily Sarkar Vs ITO (ITAT Kolkata)
Income Tax Appellate Tribunal (ITAT), Kolkata Bench, has allowed the appeal filed by Lily Sarkar, the daughter of the deceased assessee, Shri Sudhir Chowdhury, against an assessment order for the Assessment Year 2011-12. The Tribunal ruled that the entire reassessment proceeding was invalid because the foundational notice under Section 148 of the Income-tax Act, 1961, was issued in the name of the deceased individual.
Shri Sudhir Chowdhury passed away on 18.12.2016. The notice initiating reassessment under Section 148 was subsequently issued in his name on 30.03.2018. The assessee’s representative argued that this notice was void ab initio and therefore the consequential assessment order should be quashed. Crucially, the representative pointed out that for the preceding assessment year (2010-11), the Ld. CIT(A), NFAC, had already quashed the assessment under identical circumstances, holding that a notice issued to a deceased person after their death is “null and void” as per Section 159 of the Act. Section 159 mandates that all pending income tax proceedings must be completed on the legal representative of the deceased person.
CIT(A) Dismissal Overturned on Procedural Grounds
Despite the favorable precedent for the 2010-11 assessment year, the Ld. CIT(A) for the 2011-12 appeal dismissed the case not on merit, but on a technicality, arguing that the appeal was not maintainable because it was filed in the name of the deceased assessee, and the legal heir had not been formally brought on record before the jurisdictional AO. The CIT(A) asserted that the AO’s record first needed updating.
