Late Shri Duleechanda Vs ITO (ITAT Delhi)
Reassessment Quashed for Change of Status: ITAT Holds Order Void Where Individual Reopened but AOP Assessed
The Delhi ITAT allowed the assessee’s appeal and quashed the reassessment order as void ab initio on a fundamental jurisdictional defect relating to the status of the assessee. The Assessing Officer had reopened the case under Section 147 in the name and status of Late Shri Duleechanda as an individual, based on information of cash deposits of ₹1.08 crore in his bank account. However, while framing the reassessment order under Sections 144/147, the AO assessed the income jointly in the hands of Shri Duleechanda and Shri Dharmender Chaudhary in the status of an Association of Persons (AOP), without ever initiating reassessment proceedings against Shri Dharmender Chaudhary.
The Tribunal held that reassessment must be completed strictly in the same name and status in which proceedings were initiated. Framing an assessment in the status of AOP when reopening was done for an individual is impermissible and renders the entire proceedings invalid. Since no notice or reopening was ever issued to the alleged co-member and the change of status was without jurisdiction, the reassessment order was held to be non-est in law. Consequently, the entire addition of ₹1.08 crore was deleted without examining the merits. The appeal was allowed in full on this legal ground.
FULL TEXT OF THE ORDER OF ITAT DELHI
This appeal by the assessee is directed against the order of the NFAC, Delhi dated 04.12.2024 pertaining to A.Y 2010-11.
