TaxTMI 
TaxTMI 
2023 (5) TMI 163
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....e true facts before him. 2. The learned assessing officer levying the penalty failed to appreciate that the penalty order was passed on the deceased person and accordingly invalid and liable to be annulled. 3. The learned assessing officer levying the penalty ought to have appreciated that the legal representative had entered the record through the Letter of Indemnity 01.10.2021 and consequently the penalty order passed in the name of deceased is opposed to law and thus liable to be cancelled. 4. Without prejudice, the learned assessing officer levying penalty ought to have appreciated that the provisions of Sec. 269SS of the Act were not applicable to the case of the appellant and consequently the penalty under sec 271D was not eligi....
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....pletion of assessment. 13. In the instant case before your Hon'ble Appellate Authority brought to your good office kindly notice that the Assessee has been demised during the proceedings of the assessment and by virtue of law, one of his Sons became a Legal Representative in this case and prayed for your Honour that levying penalty is in violation of the one of the fundamental principles of the constitution of India under Natural Justice and opportunity of being heard not granted. Since, the Assessee had declared total consideration received as per sale deed and bank statements and TDS has be, covered against the entire consideration. Accordingly the Assessee disposed off taxes and applicable interest before the assessment proceedings....
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....s of the case are as follows: The assessee has sold a property for Rs.2,14,22,160 and received Rs.2,12,07,936 from the purchaser after deduction of TDS at 1% as per the provisions of section 194-IA of the Act. Out of the consideration received of Rs.2,12,07,936, Rs.2 crore was received by way of RTGS and balance Rs.12,07,936 was accepted in cash. Taking note of this cash transaction in respect of the transfer of the property, the Assessing Officer invoked the provisions of section 269SS of the Act. The A.O. after affording opportunity of being heard to the assessee, imposed penalty of Rs.12,07,939 u/s 271D of the Act (being equal amount received by the assessee in cash). 4. Aggrieved by the order of the penalty u/s 271D of the Act, amount....
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....r by holding that the penalty proceedings were initiated when the assessee was alive and the objections to the notice for the penalty initiated was filed by the assessee himself. 8. As per section 159(2) of the Act, mere initiation of penalty proceeding correctly is not sufficient, but it ought to have been completed also in accordance with the said provisions. In other words, any proceedings taken against the deceased before his death shall be deemed to have been taken against the legal representative and may be continued against the legal representative from the stage at which it stood on the date of death of the deceased. Therefore, when the penalty order was passed in the name of the assesee, he had already died. Hence, the penalty ord....
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....not in name of his legal representative was held to be illegal and all consequential orders passed pursuant to notice would be non est and was to be quashed (v) The Hon'ble Delhi High Court in the case of Vikram Bhatnagar v. ACIT [2023] 147 taxmann.com 254 (Delhi) held that: Where it was duly disclosed in return that it was filed by legal representative of deceased assessee, jurisdictional notice issued against deceased assessee and assessment order passed against dead person on his PAN without bringing on record all legal representatives would be null and void and was to be set aside (vi) The Hon'ble High Court of Madras in the case of K. Suresh v. ACIT, Non-Corporate Circle-1, Chennai [2021] 129 taxmann.com 67 (Madras) held that: ....
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...., so that they may be continued after his death, which have been taken in his lifetime. In his lifetime such proceedings would necessarily be taken against and in the name of the deceased. However, if the deceased has died before any such proceedings could have been taken against him, the proceedings may be taken against the legal representative of the deceased under the provisions of sub-clause (b) of sub-section (2) of section 159. It is now clear that assessment under the Act can only be made against an individual assessee who is a living person. It is, thus, well settled that an assessment made on a dead person would, on the face of it, be a nullity in law. Therefore, in the instant case, the penalty order founded as it was on an asse....