1988 (9) TMI 97 - AT - Income Tax

Appeal Allowed Despite Naming Deceased Respondent: Procedural Defect Curable

INCOME TAX OFFICER. Versus LATE JWALLA PRASAD SIKARIA.

INCOME TAX OFFICER. Versus LATE JWALLA PRASAD SIKARIA. - TTJ 033, 262, Issues Involved:1. Validity of the appeal by the Revenue.2. Imposition of penalty under section 271(1)(A).3. Procedural defects in the appeal memorandum.Detailed Analysis:1. Validity of the Appeal by the Revenue:The primary issue is whether the appeal by the Revenue is maintainable, given that the deceased, Late Jwalla Prasad Sikaria, was named as the respondent. The legal representatives, Shri Kashi Prasad Sikaria and Smt. Santi Devi Sikaria, were already involved in the penalty proceedings and had appealed to the AAC. The learned counsel for the assessee argued that the appeal is not maintainable as it was filed against a deceased person, citing various precedents such as the Tripura High Court decision in AIR 1963 Tripura 44 and the Supreme Court decision in Ram Prasad & Ors. (1972) 86 ITR 145 (SC).The Revenue's representative countered by asserting that the appeal was valid, as the legal representatives had been involved from the beginning, and any clerical error in naming the deceased as the respondent did not invalidate the proceedings. The Revenue relied on section 292B and the Supreme Court decision in Guduthur Bros. vs. ITO (1960) 40 ITR 298 (SC).2. Imposition of Penalty under Section 271(1)(A):The ITO imposed a penalty of Rs. 24,104 for the delay in filing the return, which was deemed without reasonable cause. The AAC, however, found the penalty unjustified and canceled it. The Revenue appealed this decision, arguing that the AAC erred in canceling the penalty. The legal representatives contended that the delay was due to late receipt of income and interest from various sources.3. Procedural Defects in the Appeal Memorandum:The Tribunal considered whether the procedural defect of naming the deceased as the respondent rendered the appeal a nullity. The Tribunal noted that the right of appeal is a substantive right and a creature of statute, as held by the Supreme Court in Mela Ram and Sons vs. CIT (1956) 29 ITR 607 (SC). The Tribunal also referred to the Delhi High Court decision in CIT vs. Roshan Lal & Anr. (1982) 134 ITR 145 (Del), which held that proceedings could continue against legal representatives if they were involved from the beginning.The Tribunal concluded that the defect in the memorandum of appeal was a curable technical mistake. Citing various precedents, including the Supreme Court decision in Kapurchand Shrrimal vs. CIT (1981) 131 ITR 451 (SC), the Tribunal held that procedural defects should not defeat justice. The Tribunal directed the Assistant Registrar to notify the appellant to correct the defect within 30 days, failing which the appeal would be disposed of as it stood.Conclusion:The Tribunal held that the appeal by the Revenue was maintainable despite the procedural defect of naming a deceased person as the respondent. The defect was deemed curable, and the appellant was given 30 days to correct it. The preliminary objections raised by the assessee's counsel were thus disposed of, allowing the appeal to proceed on its merits.