ITO Vs Shrikanta Amritkumar Jain (ITAT Pune)
Assessment on Deceased Assessee Not Void Where Notice Was Issued During Lifetime – ITAT Pune Orders Fresh Assessment in Legal Heir’s Name
The Pune ITAT held that where a valid notice under section 143(2) was issued during the lifetime of the assessee, the subsequent assessment proceedings do not become void merely because the assessment order was ultimately passed in the name of the deceased. The defect is curable by framing the assessment in the name of the legal heir.
In this case, the assessee died on 23.11.2019 after a scrutiny notice under section 143(2) had already been issued on 28.09.2019. The legal heir had registered himself on the income-tax portal and participated in the assessment proceedings. However, the final assessment order under section 143(3) read with section 144B was passed in the name of the deceased assessee, making additions exceeding ₹6.24 crore.
The CIT(A) held that an assessment order cannot be sustained in the name of a deceased person and allowed the appeal. Before the Tribunal, the Revenue contended that the proceedings had been validly initiated during the assessee’s lifetime and that section 159 permits continuation of proceedings against legal representatives.
Accepting the Revenue’s contention, the ITAT distinguished decisions where notices themselves were issued after the death of the assessee. Relying on decisions of the Karnataka High Court, Gujarat High Court and a recent coordinate bench ruling, the Tribunal held that when proceedings were validly initiated before death, the assessment is not void ab initio; the proper course is to cure the defect by completing the assessment in the name of the legal heir. Accordingly, the Tribunal set aside the CIT(A)’s order and restored the matter to the Assessing Officer with a direction to pass a fresh assessment order in the name of the legal heir after granting due opportunity of hearing.
FULL TEXT OF THE ORDER OF ITAT PUNE
