(LATE) MRS. ALEXANDER A.E. THROUGH EXECUTOR, MUMBAI V. ITO 19(3)(1), MUMBAI

ITA 919/MUM/2014

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9198 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-06-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 1998-1999
• Appeal Filed On: 10-02-2014

Judgement Text

1 IN THE INCOME-TAX APPELLATE TRIBUNAL A BENCH MUMB AI BEFORE SHRI G.S. PANNU, VICE- PRESIDENT AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO. 919/MUM/2014 (ASSESSMENT YEAR 1998-99 ) (LATE) MRS. ALEXANDER A.E. THROUGH EXECUTOR MRS. BLOSSOM V. RODRIGUEZ, ALEXANDER HOUSE, 70, PALI HILL, BANDRA (WEST), MUMBAI- 400050. PAN: AENPB8485R VS. ITO - 19(3)(1), PIRAMAL CHAMBER, LALBAUG, PAREL, MUMBA-400012. A PPELLANT RESPONDENT APPELLANT BY : SHRI ASHOK J. PATIL (AR) RESPONDENT BY : SHRI MANISH SINGH (DR) DATE OF HEARING : 21.06.2019 DATE OF PRONOUNCEMEN T : 26.06.2019 ORDER UNDER SECTION 254(1)OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER; 1. THIS APPEAL BY THE EXECUTOR/ASSESSEE DIRECTED AGAIN ST THE ORDERS OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-30, MUMBAI [HE REINAFTER REFERRED AS LD. CIT(A)] DATED 06.11.2013 FOR ASSESSMENT YEAR 1998-99. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1] ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE COMMISSIONER OF INCOME TAX (APPEALS) [CIT(A)] ERRED IN HOLDING THAT THE REOPENING OF THE ASSESSMENT U/S 147 RWS 148 WAS VALID. 2] ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 13,87,00/- MADE BY T HE AD ON THE BASIS OF THE VDIS DECLARATION MADE BY THE (DECEASED) APPELLANT. 3] ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE CIT(A) FAILED TO APPRECIATE THAT THE COPIES OF THE VDIS DECLARATION MADE BY THE (DECEASED) APPELLANT WERE NOT PROVIDED BY THE INCOME TAX DEPAR TMENT, BE IT THE AO, THE ITA NO. 919/MUM/2014-(LATE) MRS. ALEXANDER A.E. 2 CIT OR THE CIT(A) HIMSELF, IN SPITE OF THERE BEING A DIRECTIVE GIVEN BY THE JURISDICTIONAL HIGH COURT, WHICH IS IN CLEAR VIOLAT ION OF THE PRINCIPLES OF NATURAL JUSTICE. 2. THE APPELLANT VIDE APPLICATION DATED 20.12.2017 RAI SED THE FOLLOWING ADDITIONAL GROUND OF APPEAL: THE APPELLANT CRAVES LEAVE TO RAISE AN ADDITIONAL GROUND OF APPEAL. THE GROUND GOES TO THE ROOT CAUSE OF THE APPELLANTS CA SE AS IT CHALLENGES THE JURISDICTION OF THE ASSESSING OFFICER, AS THE NOTIC E U/S 148 HAS NOT BEEN ISSUED ON THE LEGAL HEIR/EXECUTOR OF (LATE) MRS. ALEXANDER AE. 3. BRIEF FACTS OF THE CASE ARE THAT A NOTICE UNDER SEC TION 148 DATED 30.03.2015 WAS ISSUED TO MRS. ALEXANDER A.E ON 30.0 3.2005 SERVED ON 31.03.2005. THE SAID NOTICE UNDER SECTION 148 WAS R EPLIED VIDE REPLY DATED 29.09.2005 BY MRS. BLOSSOM V. RODRIGUEZ (APPE LLANT). IN RESPONSE TO THE NOTICE, THE APPELLANT SUBMITTED THAT MRS. A LEXANDER A.E. EXPIRED ON 18.12.2004 AND FURNISHED THE COPY OF DEATH CERTI FICATE. IT WAS FURTHER STATED THAT THE NOTICE WAS SERVED AFTER EXPIRY OF S IX YEAR FROM THE END OF RELEVANT ASSESSMENT YEAR I.E. 1998-99 AND THUS SAME IS INVALID. IT WAS FURTHER STATED THAT THE NOTICE WAS SERVED IN THE NA ME OF DEAD PERSON AND THE SAME IS INVALID AND VOID AB-INITIO. IT WAS FURT HER STATED THAT AS PER WILL OF MRS. ALEXANDER A.E., HER DAUGHTER MR. BLOSSOM V. RODRIGUEZ IS THE EXECUTOR OF WILL. IN ALTERNATIVE AND WITHOUT PREJUD ICIAL SUBMISSION, THE ASSESSEE/REPRESENTATIVE OF ASSESSEE REQUESTED FOR 3 0 DAYS TIME FOR FILING RETURN AND STATED THAT DECEASED ASSESSEE HAD NO INC OME EXCEPT INTEREST ON SAVING BANK ACCOUNT WHICH IS SUBJECT TO DEDUCTION U NDER SECTION 80L. ITA NO. 919/MUM/2014-(LATE) MRS. ALEXANDER A.E. 3 4. THE ASSESSING OFFICER PROCEEDED TO MAKE REASSESSMEN T AND RECORDED THAT REASONS RECORDED WERE COMMUNICATED TO ASSESSEE ON 1 3.10.2015. THE ASSESSING OFFICER IN PARA-2 OF HIS ORDER EXTRACTED THE REASONS RECORDED, WHEREIN THE ASSESSING OFFICER RECORDED THAT DECEASE D ASSESSEE DECLARED ASSET OF RS. 13,87,000/-, TO CHECK WHETHER ASSESSEE WHO HAVE AVAILED THE FACILITY OF VDIS ARE STILL CONTINUED TO FILE THE RE TURN OF INCOME OR SUBSEQUENTLY STOP FILING OR RETURN OF INCOME. HENCE , ALL VOLUNTARY DISCLOSER INCOME SCHEME (VDIS) CASES WERE REOPENED ON THE RECOMMENDATION OF STANDING COMMITTEE WITH THE PREVI OUS APPROVAL OF CIT-XIX, THEREFORE, THE ASSESSEE WAS CALLED FOR FIL ING ACKNOWLEDGEMENT OF ASSESSMENT YEAR 1998-99 TO 2004-05 AND COPY OF C ERTIFICATE ISSUED FOR VDIS. 5. THE ASSESSING OFFICER FURTHER NOTED THAT REPRESENTA TIVE OF ASSESSEE SEEK TIME ON VARIOUS DATE. THE ASSESSING OFFICER TREATED THE INCOME DECLARED BY ASSESSEE IN VDIS AS INCOME FROM OTHER SOURCES FOR ASSESSMENT YEAR 1998-99 AND PASSED THE ASSESSMENT ORDER ON 07.03.2006 UNDER SECTION 144 R.W.S. 147. ON APPEAL BEFORE THE LD. CI T(A), THE ACTION OF ASSESSING OFFICER ON REOPENING AS WELL AS ON MERIT WAS CONFIRMED. THUS, FURTHER AGGRIEVED BY THE ORDER OF LD. CIT(A), THE A SSESSEE FILED THE PRESENT APPEAL BEFORE US. 6. WE HAVE HEARD THE SUBMISSION OF LD. AUTHORIZED REPR ESENTATIVE (AR) OF THE ASSESSEE AND LD. DEPARTMENT REPRESENTATIVE (DR) FOR THE REVENUE AND ITA NO. 919/MUM/2014-(LATE) MRS. ALEXANDER A.E. 4 PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD. A R OF THE ASSESSEE SUBMITS THAT NO COPY OF REASONS RECORDED WAS PROVID ED TO THE ASSESSEE. THE ASSESSMENT WAS RE-OPENED AFTER SIX YEARS FROM T HE END OF RELEVANT ASSESSMENT YEAR. AFTER HEARING THE PARTIES AT PRELI MINARY STAGE, WE DIRECTED THE LD. DR FOR THE REVENUE TO CALL THE ASS ESSMENT RECORD. THE ASSESSMENT RECORD WAS PRODUCED BEFORE THE BENCH ON 28.11.2017. 7. WITH THE ASSISTANCE OF THE LD REPRESENTATIVES OF TH E PARTIES, WE EXAMINED THE ASSESSMENT RECORD. ON PERUSAL OF ASSESSMENT REC ORDED, IT WAS REVEALED THAT REASONS RECORDED WERE NOT AVAILABLE IN THE ASS ESSMENT FOLDER BROUGHT BY LD. DR FOR THE REVENUE. THEREFORE, AFTER RECORD ING OUR OBSERVATION IN THE ORDER-SHEET ON 28.11.2017, THE HEARING OF APPEA L WAS FIXED ON 21.12.2017 AND FROM TIME TO TIME AND FINALLY HEARD ON 21.06.2019. 8. THE LD. AR OF THE ASSESSEE SUBMITS THAT THE APPELLA NT MADE REQUEST TO THE ASSESSING OFFICER TO PROVIDE THE COPY OF VDIS DECLA RED BY THE DECEASED ASSESSEE; HOWEVER, DESPITE PERSUASION THE APPELLANT WAS NOT PROVIDED THE DESIRED DOCUMENT. THE APPELLANT FILED CIVIL WRIT P ETITION BEFORE BOMBAY HIGH COURT VIDE WP NO. 2384/2009 FOR DIRECTION TO THE REVENUE AUTHORITIES TO PROVIDE THE COPY OF THE VDIS DECLARA TION BY DECEASED ASSESSEE. THE HONBLE HIGH COURT, VIDE ORDER DATE D 03.02.2010 DIRECTED THE APPELLANT TO APPLY COPY VDIS SAME BEFORE THE AUTHORITIES CONCERNED AND DIRECTED REVENUE TO CONSIDER THE APPELLANT APPL ICATION BEFORE TAKING ANY STEP IN PROCEEDINGS. THE APPELLANT APPLIED FO R THE COPY WITH THE ITA NO. 919/MUM/2014-(LATE) MRS. ALEXANDER A.E. 5 REVENUE AUTHORITIES BUT NO COPY OF VDIS IS SUPPLIED TO THE APPELLANT. THE ASSESSEE WAS NOT HAVING ANY COPY OF VDIS FILED BY D ECEASED ASSESSEE. 9. IT WAS FURTHER SUBMITTED BY LD. AR FOR THE APPELLAN T THAT THE REOPENING IS BAD IN LAW AS NO NOTICE WAS ISSUED ON THE LEGAL HEI RS OF THE ASSESSEE. THE NOTICE ISSUED UNDER SECTION 148 DATED 30.03.2005 WA S ISSUED AGAINST THE DEAD PERSON. IN ALTERNATIVE SUBMISSIONS THE LD AR F OR THE APPELLANT SUBMITS THAT NO PRIOR PERMISSION OF JOINT COMMISSIO NER WAS OBTAINED BEFORE REOPENING AS MANDATED UNDER SECTION152 OF TH E ACT. THE LD. AR SUBMITS THAT THE ASSESSMENT ORDER IS INVALID AND TH E PROCEEDINGS ARE VOID AB INITIO. AND IS LIABLE TO BE DECLARED AS SUCH. 10. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE SUPPO RTED THE ORDER OF AUTHORITIES BELOW. 11. WE HAVE CONSIDERED THE SUBMISSION OF BOTH THE PARTI ES AND HAVE GONE THROUGH THE ORDERS OF LOWER AUTHORITIES. THE ASSESS ING OFFICER ISSUED NOTICE UNDER SECTION 148 DATED 30.03.2015 FOR ASSES SMENT YEAR 1998-99. THE NOTICE WAS ISSUED IN THE NAME OF DEAD PERSON. I N RESPONSE TO THE NOTICE UNDER SECTION 148, THE EXECUTOR OF DECEASED ASSESSEE INTIMATED THAT THE ASSESSEE HAS EXPIRED ON 18.12.2014 AND FURNISHE D THE COPY OF DEATH CERTIFICATE ISSUED BY MUNICIPAL CORPORATION, GREATE R MUMBAI. THE ASSESSING OFFICER DESPITE INFORMING ABOUT THE DEATH PROCEEDED TO COMPLETE THE ASSESSMENT. THE ACTION WAS INITIATED A GAINST THE DEAD PERSON. IT IS SETTLED LAW THAT NO PROCEEDING CAN BE INITIAT ED AGAINST THE DEAD ITA NO. 919/MUM/2014-(LATE) MRS. ALEXANDER A.E. 6 PERSON. THEREFORE, IN OUR CONSIDERED VIEW THE ACTI ON INITIATED BY ASSESSING OFFICER WAS BAD IN LAW. 12. FURTHER, WE HAVE NOTED THAT THE ASSESSING OFFICER I N PARA-2 OF ASSESSMENT ORDER HAS RECORDED THE REASONS OF RE-OPENING, WHICH WERE ALLEGEDLY COMMUNICATED TO THE ASSESSEE ON 13.10.2005. THE AS SESSMENT WAS COMPLETED BY INCOME-TAX OFFICER WARD-19(3)-1 MUMBAI . THOUGH, THE LD. AR FOR THE APPELLANT DISPUTED THAT NO REASONS RECOR DED WERE COMMUNICATED TO THE APPELLANT. THE ALLEGED REASONS AS EXTRACTED IN PARA - 2 OF THE ASSESSMENT ORDER, DOES NOT INDICATE THAT A NY PRIOR APPROVAL OF JOINT COMMISSIONER AS REQUIRED UNDER SECTION 152 WA S OBTAINED. IN ABSENCE OF PROPER SANCTION BY JCIT, THE ALLEGED REA SONS OF RE-OPENING ARE ITSELF BAD-IN-LAW. 13. AS WE HAVE HELD THAT INITIATION OF ACTION BY ISSUAN CE OF NOTICE UNDER SECTION148 ON THE DEAD PERSON AND NO PRIOR PERMISSI ON/ APPROVAL OF JCIT WAS OBTAINED, HENCE, THE ASSESSMENT ORDER AS INVAL ID, THEREFORE, ADJUDICATION OF CASE ON MERIT HAVE BECOME ACADEMIC . 14. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 26/06/ 2019. SD/- SD /- G.S. PANNU PAWAN SINGH VICE-PRESIDENT JUDICIAL MEMBER MUMBAI, DATE: 26.06.2019 SK COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. RESPONDENT ITA NO. 919/MUM/2014-(LATE) MRS. ALEXANDER A.E. 7 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. DR A BENCH, ITAT, MUMBAI 6. GUARD FILE BY ORDER, DY./ASST. REGISTRAR ITAT, MUMBAI