ITO Vs Haresh Dayashankar Shrivastav (ITAT Ahmedabad)
ITAT Ahmedabad: Deceased Assessee’s Assessment Not Void Ab Initio; Tribunal Remands Case for Fresh Assessment on legal heir of Deceased Taxpayer
Revenue appealed against CIT(A)’s order which quashed an ex-parte assessment passed u/s 144 on a deceased assessee. The key issue was whether an assessment order passed after the death of the assessee is valid, especially when the legal heir had informed the AO of the death & not filed any return.
Assessee failed to file return for AY 2017–18. Cash deposits of ₹1.58 crore & sale of property for ₹1 crore during the year were not disclosed. Notice u/s 142(1) issued on 29.12.2017 was duly served when the assessee was alive. However, the final notice & assessment proceedings continued even after his death on 27.08.2019. Legal heir informed the AO about the death & expressed inability to provide details. AO proceeded to pass an assessment order in the name of the deceased, making an addition of ₹3.28 crore. CIT(A) held the assessment order as void ab initio being passed on a deceased person & deleted the entire addition.
Before the Tribunal, Assessee relied on PCIT Vs. Maruti Suzuki India Ltd (SC) wherein held that assessment passed on dead person is invalid in law & Alamelu Veerappan Vs. ITO(Madras HC) wherein it was held that there is no statutory obligation on the part of the legal representative of the deceased assessee to immediately intimate the death of the assessee or take steps to cancel the PAN registration of the deceased. Assessee also relied on CIT Vs. Amarchand N. Shroff (SC), wherein it was held that the proceedings are void, if issued in name of dead person & the legal representative is liable only to the extent of the estate of the deceased.
