Late Smt. Sarvari Begum Vs JCIT (ITAT Delhi)
ITAT Delhi Restores Penalty Appeal of deceased assessee – Legal Heirs to be Heard Afresh
Delhi Trib restored matter to CIT(A) after finding that penalty appeal had been dismissed ex parte without affording proper opportunity.
Penalty u/s 271D had been levied for violation of provisions relating to acceptance of loans in cash. CIT(A) by order dated 27.02.2025, sustained the penalty ex parte, observing repeated adjournments & non-compliance by Assessee.
Before Tribunal, it was argued that though CIT(A) had fixed hearing on 03.02.2025 with last date of filing submissions as 07.02.2025, Assessee sought adjournment citing illness. However, Assessee subsequently passed away on 09.03.2025. Counsel submitted that in such circumstances, appeal ought not to have been disposed of ex parte, but an opportunity should have been extended to the legal heirs.Tribunal noted that though adjournments had been sought, the fact remained that Assessee expired soon thereafter. In these circumstances, principles of natural justice required that the matter be restored to CIT(A) for fresh consideration after hearing legal heirs. Accordingly, Tribunal set aside the ex parte order & remitted the matter back to CIT(A) with a direction to decide afresh in accordance with law after affording adequate opportunity to legal heirs.
