Income Tax Officer-1(2), Kanpur V. Late Devi Prasad Pathak, through L/Hr. wife Smt. Prema Pathak, Kanpur

ITA 767/LKW/2017

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 9773 (ITAT-LUCKNOW)
• Duration Of Justice: 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 06-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A , LUCKNOW BEFORE SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA NO. 766 & 767/LKW/2017 ASSESSMENT YEAR: 2009 - 10 & 2014 - 15 INCOME TAX OFFICER 1(2) RANG E 1 KANPUR V. LATE DEVI PRASAD PATHAK THROUGH LEGAL HEIR & WIFE SMT. PREMA PATHAK 75 - A, SANIGAWA ROAD, BHAWA NAGAR, KANPUR T AN /PAN : AMEPP7696 (APP LICA NT) (RESPONDENT) APP LIC ANT BY: SHRI AJAY KUMAR, D.R. RESPONDENT BY: SHRI RAKESH GARG, ADVOCATE DAT E OF HEARING: 18 0 9 201 8 DATE OF PRONOUNCEMENT: 19 0 9 201 8 O R D E R PER P ARTHA SARATHI CHAUDHURY, J.M : THESE APPEALS PREFERRED BY THE REVENUE EMANATE FROM SEPARATE ORDERS PASSED BY THE LD. CIT(A) - I, KANPUR DATED 22/9/2017 FOR ASSESSMENT YEARS 2009 - 10 AND 2014 - 15 RESPECTIVELY AS PER GROUNDS OF APPEAL ON RECORD. 2 . IN BOTH THESE APPEALS, GRIEVANCE OF THE REVENUE IS AGAINST THE ORDER OF THE LD. CIT(A) HOLDING THE ASSESSMENTS AS NULL AND VOID ON THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE. 3 . FACTS IN BRIEF AR E THAT DURING THE PENDENCY OF THE ASSESSMENT PROCEEDINGS , IN AN UNFORTUNATE ROAD ACCIDENT ASSESSEE HAD DIED AND COPIES OF F.I.R AND DEATH CERTIFICATE WERE FILED BEFORE THE ASSESSING OFFICER. THE ASSESSING OFFICER ASKED THE LD. A.R. OF THE ASSESSEE TO FURN ISH ORIGINAL COPIES OF F.I.R. AND DEATH CERTIFICATE WHICH WERE NOT ITA NO.766 & 767/LKW/2017 PAGE 2 OF 5 PROVIDED. INSTEAD OF RESORTING TO PROVISIONS OF SECTION 159(2) OF THE ACT, ASSESSING OFFICER COMPLETED ASSESSMENT UNDER SECTION 143(3) FOR BOTH THE ASSESSMENT YEARS IN THE HANDS OF THE DEC EASED ASSESSEE. 4 . WHEN THE MATTER TRAVELLED BEFORE THE LD. CIT(A), REMAND REPORT WAS ALSO CALLED FROM THE ASSESSING OFFICER WHEREFROM IT WAS ESTABLISHED THAT DURING PENDENCY OF ASSESSMENT , UNFORESEEN INCIDENT OCCURRED RESULTING INTO DEATH OF THE ASSESSEE, WH ICH WAS ACCEPTED BY THE ASSESSING OFFICER IN THE REMAND REPORT. THE ASSESSING OFFICER ONLY STATED THAT ORIGINAL F.I.R. AND DEATH CERTIFICATE WERE NOT PLACED BEFORE HIM. THE LD. CIT(A) AFTER DETAILED OBSERVATION HELD THAT WHAT IS MANDATORY IN THE PRESENT SCENARIO IS THAT THE ASSESSING OFFICER SHOULD HAVE FIRST PASSED AN ORDER UNDER SECTION 159(2) DETERMINING THE INCOME IN THE HANDS OF THE LEGAL HEIR OF THE DECEASED ASSESSEE. UNDER NO CIRCUMSTANCES ASSESSMENT CAN BE MADE IN THE HANDS OF THE DECEASED ASSESS EE. THE ASSESSING OFFICER , THEREFORE, SH OULD NOT HAVE PASSED ASSESSMENT ORDER DIRECTLY UNDER SECTION 143(3) OF THE ACT IN THE HANDS OF THE DECEASED ASSESSEE WITHOUT RESORTING TO PROVISIONS OF SECTION 159(2) OF THE ACT. THE LD. CIT(A) IN HIS ORDER HAS PLA CED RELIANCE ON THE DECISION OF AHMEDABAD BENCH OF THE TRIBUNAL IN THE CASE OF VINOD C GANDHI L/H OF LATE SHRI CHANDRAKANT A. GANDHI VS. ACIT IN IT(SS)A NO.594/AHD/2012 WHEREIN THE TRIBUNAL HELD AS UNDER: - 'IN THE CASE BEFORE U S, THE LEGAL HEIR WAS NEVER IMPL EADED OR BROUGHT ON RECORD. THE SHOW CAUSE NOTICE FOR PENALTY WAS NOT ISSUED, AS LEGAL HEIR OF THE DECEASED, AND THEREFORE, IT CANNOT BE SAID THAT NON - MENTIONING OF THE NAME OF THE LEGAL HEIR AND WRITING NAME OF THE DECEASED AT THE TOP OF THE PENALTY O RDER IS MERELY A CLERICAL ERROR. IN OUR CONSIDERED VIEW, WHERE LEGAL HEIRS OF THE DECEASED WAS BROUGHT ON RECORD AND WAS IMPLEADED IN THE PROCEEDINGS AS LEGAL HEIR, ARID ONLY MISTAKE IS IN WRITING OF THE NAME OF THE DECEASED ON THE TOP OF THE ORDER PASSED BY THE AO, ITA NO.766 & 767/LKW/2017 PAGE 3 OF 5 THE SAME SHALL BE SIMPLY A CLERICAL ERROR AND SHALL HAVE NO ADVERSE EFFECT ON THE PROCEEDINGS WITHIN SECTION 292B OF THE ACT. HOWEVER, IF THE AO HAS FAILED TO BRING THE LEGAL HEIRS ON R ECORD AND THE LEGAL HEIRS HAS NOT BEEN IMPLEADED, IT CANNOT BE S AID THAT IT IS MERELY A CLERICAL ERROR TO BE SAVED BY THE PROVISION OF SECTION 292B OF THE ACT, AND SUCH AN ORDER PASSED ON THE DEAD PERSON SHALL BE NULL AND VOID, AND HAS TO BE QUASHED. IN THIS CASE, THE FACTS OF THE CASE LEAVES TO O NLY CONCLUSION THA T THE ORD ER IMPOSING PENALTY WAS PASSED O N THE DECEASED, AND THEREFORE, IS NULL AND VOID, AND THE PENALTY ON THE DEAD PERSON IS LIABLE TO BE CANCELLED ON THIS GROUND ALONE AND ACCORDI NGLY, WE CANCEL THE PENALTY LEVIED UNDER SECTION 158BFA(2) OF THE ACT.' 5 . H E HAS ALSO PLACED RELIANCE ON THE JUDGMENT OF THE HON'BLE M.P. HIGH COURT IN THE CASE OF CIT VS. DALUMAL SHYAMUMAL [2005] 276 ITR 62, WHEREIN THE COURT HAS HELD THAT IN A CASE WHERE AN ASSESSEE DIES PENDING ANY ASSESSMENT PROCEEDINGS, THE PROVISIONS OF SEC TION 159 OF THE ACT GET ATTRACTED. IT IS THE DUTY OF THE ASSESSING OFFICER TO ENSURE COMPLIANCE OF SUB - SECTION (2) OF SECTION 159 BEFORE ANY ORDERS ARE PASSED. 6 . SIMILARLY, THE HON'BLE CHENNAI BENCH OF THE TRIBUNAL IN THE CASE OF LATE A .Y. PRABHAKAR VS. ACI T [2007] 12 SOT 1 , HELD THAT IF INCOME TAX OFFICER IS INFORMED ABOUT THE DEATH OF THE ASSESSEE AND HIS LEGAL REPRESENTATIVES, HE MUST ISSUE NOTICES TO LEGAL REPRESENTATIVES AND MAKE THE ASSESSMENT IN THE NAME OF LEGAL REPRE SENTATIVES . IF HE FAIL S TO DO SO AND MAKES THE ASSESSMENT IN THE NAME OF DECEASED, THEN SUCH ASSESSMENT WILL BE VOID AB - INITIO. 7 . THE LD. CIT(A) IN THE INSTANT CASE FOR BOTH THE ASSESSMENT YEARS HAS HELD AS FOLLOWS: - AO HE ASSESSED INCOME IN THE HANDS OF SATE DEVI PRASAD PATHAK WITHOUT PAS SING ORDER UNDER SEC TION 159(2) ON LEGAL HEIRS. ITA NO.766 & 767/LKW/2017 PAGE 4 OF 5 THUS THIS ERROR IS NOT COVERED AS PER PROVISIONS OF SE TION 292B AS LEGAL HEIRS WERE NOT IMPLEADED IN THE CASE AS PER PROVISIONS OF SECTI ON 292B EVEN AFTER THE AO KNEW OF THIS FACT. AS THE AO HAS FAILED TO BRI NG THE LEGAL HEIRS ON RECORD AND THE LEGAL HEIRS HAS NOT B EEN IMPLEADED, IT CANNOT BE SAID THAT IT IS S MERELY A CLERICAL ERROR TO BE SAVED BY THE PROVISION OF SECTION 292B OF THE ACT, AND SUCH AN ORDER PASSED ON THE DEAD PERSON SHALL BE NULL AND VOID, AND HAS TO BE QUASHED. IN THIS CASE, THE FACTS OF THE CASE LEAVES TO ONLY CONCLUSION THAT THE ASSESSMENT ORDER WAS PASSED ON THE DECEASED, AND THEREFORE, IS NULL AND VOID, AND IS LIABLE TO BE CANCELLED ON THIS GROUND ALONE AND ACCORDINGLY I DO THE SAM E. 8 . WE HA VE PERUSED THE CASE RECORD AND HEARD THE RIVAL CONTENTIONS . IT IS AN UNDISPUTED FACT THAT IN THE PRESENT CASE THE ASSESSEE DIED PENDING ASSESSMENT IN AN UNFORESEEN INCIDENT. UNDER THESE CIRCUMSTANCES, ASSESSING OFFICER SHOULD HAVE RESORTED TO PROVISIONS OF SECTION 159(2) OF THE ACT TO BRING THE LEGAL HEIR OF THE DECEASED ASSESSEE AND THEN TO PASS SUITABLE ORDER. IN THIS CASE, ASSESSMENT WAS DONE IN THE HANDS OF THE DECEASED ASSESSEE UNDER SECTION 143(3) OF THE ACT WHICH IS VOID AB - INITIO. WE , THEREFORE, DO NOT FIND ANY INFIRMITY IN THE FINDINGS OF THE LD. CIT(A) IN HOLDING THAT THE ASSESSMENTS FOR BOTH THE ASSESSMENT YEARS ARE NULL AND VOID. 9 . IN THE RESULT, BOTH THE APPEALS OF THE REVENUE ARE DISMISED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 / 0 9 / 201 8 . SD/ - SD/ - [ T.S. KAPOOR ] [PARTHA SARATHI CHAUDHURY ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 19 TH SEPTEMBER , 201 8 JJ: 1809 ITA NO.766 & 767/LKW/2017 PAGE 5 OF 5 COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR