Delhi ITAT: Re-adjudication After Assessee’s Death During Tax Assessment

The Income Tax Appellate Tribunal (ITAT) Delhi Bench has ordered re-adjudication after the assessee passed away during the income tax assessment process.

The taxpayer Salochna Devi is the legitimate heir of Rakesh Kausik (Rakes Kosik), Chanda Kosik. Under Section 147 of the Income Tax Act, of 1961, the taxpayer’s case was reopened on the grounds of the AIR data present on the record, that the taxpayer would make the cash deposit in his savings bank account with Canara Bank and Punjab National Bank.

No one represented the assessee during the hearings in response to the statutory notice. Cash deposits and interest income were classified as unexplained income by the Assessing Officer (AO), who added them together and calculated the assessee’s income.

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N.S. Bhatnagar argued on the assessee’s side that the orders issued by the authorities below were invalid and illegitimate from the start since they were issued in the assessee’s deceased name. Moreover, he said that the assessee was not given a sufficient opportunity to be heard on the soundness of the addition.

On behalf of the revenue, Maimun Alam stated that dead Rakesh Kausik was alive when the proceedings were commenced. He also relied on Section 159 of the Income Tax Act, claiming that the proceedings would be regarded to be brought against the legal representation. A single Bench of Kul Bharat (Judicial Member) granted the appeal, remarking that the AO had not specified in the assessment decision that the proceedings against the legal heir were continuing, nor was there any reference to the assessee’s death.