The ITO, Ward1(2)(1), Ahmedabad V. Shekhar B. Kabra L/h of late Brijbhushanlal Kabra, Ahmedabad

ITA 554/AHD/2022

AI Insights

The case revolves around an appeal by the revenue against the order of the Commissioner of Income Tax (Appeals), which had quashed an assessment order. The original assessment was made under section 143(3) of the Income Tax Act, 1961, in the name of a deceased individual, Late Shri Brijbhushanlal Kabra, despite the legal heir having informed the Assessing Officer (AO) about the death. The Tribunal found that the assessment in the name of a deceased person was not legally tenable and thus quashed the assessment order.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 135994 (ITAT-AHMEDABAD)
• Duration Of Justice: 9 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 22-08-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 07-12-2022
• Other Referred Cases: PCIT vs. Maruti Suzuki India Ltd, Spice Enfotainment
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: FORTHEASSESSEESUBMITTEDTHATTHEASSESSEE; MSSAUMYAPANDEYJAINSR
• Assessee Lawyers: SHRIVIHARSONI

Judgement Text

आयकरअपीलीयअधिकरण,अहमदाबादनायपीप INTHEINCOMETAXAPPELLATETRIBUNAL, ‘’B’’BENCH,AHMEDABAD BEFORESHRIWASEEMAHMED,ACCOUNTANTMEMBER And SHRIT.RSENTHILKUMAR,JUDICIALMEMBER आयकरअपीलसं ./ITANos.554/AHD/2022 निर्धररवरध/Asstt.Year:2017-18 I.T.O, Ward-1(2)(1), Ahmedabad. Vs. ShekharB.Kabra,L/hofLate BrijbhushanlalKabra, 27,PatalSociety, SahibaugRoad, Shahibaug, Ahmedabad380004. PAN:ABMPK0517B (Applicant)(Respondent) Revenueby:MsSaumyaPandeyJainSr.DR Assesseeby:ShriViharSoni,A.R सुिव्ईकीत्रीख/DateofHearing:23/08/2023 घोरर्कीत्रीख /DateofPronouncement:13/09/2023 आदेश /ORDER PERWASEEMAHMED,ACCOUNTANTMEMBER: ThecaptionedappealhasbeenfiledattheinstanceoftheRevenueagainst theorderoftheLearnedCommissionerofIncomeTax(Appeals),Ahmedabad,(in short“Ld.CIT(A)”)arisinginthematterofassessmentorderpassedundersection ITAno.554/AHD/2022 A.Y.2017-18 2 143(3)oftheIncomeTaxAct1961(here-in-afterreferredtoas"theAct") relevanttotheAssessmentYear2017-18. 2.TheRevenuehasraisedthefollowinggroundsofappeal: 1.“whethertheCIT(A)haserredinfactsandlawinquashingtheassessmentorderwhen heirsandlegalrepresentativeofthedeceasedassesseecouldbesaidtohavebeensubmitted tothejurisdictionoftheassessingofficerandhaveparticipatedinthedeadassessee’scase andcommencementofassessment” 2.“TheLd.CIT(A)erredinlawandonfactsindeletingadditionofRs.1,20,56,000/-u/s.69A oftheActintheabovecircumstance.” 3.“Theappellantcravesleavetoamendoralteranygroundoraddanewground,which maybenecessary”. 4.“Itis,therefore,prayedthattheorderofLd.CIT(A)maybesetasideandthatofthe AssessingOfficerberestored.” 3.AttheoutsettheLd.Counselfortheassesseesubmittedthattheassessee inthepresentcaseexpiredon12/04/2018,andthisfactwasalsocommunicated bythesonoftheassesseeShriShekharKabrabeingthelegalheirvideletter dated05/02/2019totheAO.However,despitethis,theAOhasframedthe assessmentinthenameofthedeceasedpersoninsteadoflegalheirs.Thus,as pertheLd.AR,theassessmentframedu/s143(3)oftheAct,inthenameofthe deceasedpersonisnotsustainableandliabletobequashed.TheLd.AR vehementlysupportedtheorderoftheLd.CIT(A).Ontheotherhand,theLd.DR couldnotcontroverttheargumentsadvancedbytheassessee.However,theLd. DRsupportedtheorderoftheAO. 4.Wehaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.Fromtheorderoftheauthoritiesbelowand materialsavailableonrecord,wenotethatfortheyearunderreferencethereturn ofincomewasfiledason31 st May2017bytheassessee(LateShriBrijbhushanlal Kabra).Thereaftertheassessee(LateShriBrijbhushanlalKabra)passedawayas ITAno.554/AHD/2022 A.Y.2017-18 3 on12 th April2018.Subsequently,thereturnoftheassesseewasselectedfor limitedscrutinyundersection143(2)oftheActvidenoticedated09 th August2018. Inresponse,thelegalheirShriShekharKabaravideletterdated5 th February2019 broughtthefactaboutthedeathoftheassesseetonoticeoftheAO.TheAO finallymadeassessmentundersection143(3)oftheActvideorderdated19 th December2019inthenameofShriBrijbhusanlalKabra(i.e.deceasedassessee). Thus,thereisnoambiguitythattheassessmenthasbeenframedinthenameof thedeceased/non-existentassessee.Thisfactcanbeverifiedfromassessment order,extractedasunder: ShriShesharkabra,thelegalheir&sonoftheassesseefiledhisreplyvideletterdated 05.02.2019andinformedthattheassesssee-Sh.BrijbhusanKabraexpiredon12.04.2018. Inresponsetonoticesissued,thelegalheiroftheassesseefiledhisrepliesthroughe- filingmodule. 4.1Itisthetritelawthatassessmentcanonlybemadeinnameofan “assessee”whoisapersonbywhomtaxispayable.Oncetheindividual expires/ceasedtoexist,heisnolongerapersonwithintheprovisionsofsection 2(31)oftheActandthereforetheassessmentinthenameofdeadpersoncannot beframed.Inholdingso,wedrawsupportandguidancefromthejudgementof Hon’bleSupremeCourtinthecaseofPCITvs.MarutiSuzukiIndiaLtd107 taxmann.com375whereinitwasheldasunder: 33.Inthepresentcase,despitethefactthattheassessingofficerwasinformedofthe amalgamatingcompanyhavingceasedtoexistasaresultoftheapprovedschemeof amalgamation,thejurisdictionalnoticewasissuedonlyinitsname.Thebasisonwhich jurisdictionwasinvokedwasfundamentallyatoddswiththelegalprinciplethatthe amalgamatingentityceasestoexistupontheapprovedschemeofamalgamation. Participationintheproceedingsbytheappellantinthecircumstancescannotoperateasan estoppelagainstlaw.Thispositionnowholdsthefieldinviewofthejudgmentofaco- ordinateBenchoftwolearnedjudgeswhichdismissedtheappealoftheRevenueinSpice Enfotainment(supra)on2November2017.ThedecisioninSpiceEnfotainmenthas beenfollowedinthecaseoftherespondentwhiledismissingtheSpecialLeavePetitionfor AY2011-2012.Indoingso,thisCourthasreliedonthedecisioninSpice Enfotainment(supra). 4.2Undeniably,allthefactssatedabovewereintheknowledgeoftheAOand theAOdespitehavingsufficienttimelimitproceededtoframetheassessment ITAno.554/AHD/2022 A.Y.2017-18 4 orderinthenameofdeceased/non-existentperson.Therefore,inviewofthe abovefacts,weholdthattheassessmentframedinthenameofthedeadperson isnotlegalandaccordinglytheassessmentisnotsustainable.Hence,wequash thesame.Hence,thegroundofappealoftherevenueisherebydismissed. 5.Intheresult,theappealfiledbytherevenueisdismissed. OrderpronouncedintheCourton13/09/2023atAhmedabad. Sd/-Sd/- (T.RSENTHILKUMAR)(WASEEMAHMED) JUDICIALMEMBERACCOUNTANTMEMBER (TrueCopy) Ahmedabad;Dated13/09/2023 Manish