TaxTMI 
TaxTMI 
2026 (6) TMI 920
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....s case is Smt Sukhjit Kaur ( aged 61 years), the wife of the deceased Late Kashmir Singh ( who expired on 13th August, 2018 ) and as stated, she was not aware of the disposal of the appeal ex-parte, on 31st January, 2025, and she came to learn of the same, only after receipt of penalty notice on 23rd April, 2025, and this appeal is prepared and filed immediately thereafter in consultation with her counsel which is belated by thirty five days, and since there was no intentional default on her part she prayed for condonation of the delay and admission of the appeal. 2.2 The Ld. DR has no objection. 2.3 Considering the reasons stated we condone the delay and admit the appeal to be heard on merits. 3. Grounds of appeal raised by the appellant in form 36 are as follows: "1. That the order of the worthy CIT(A) under section 250 of Income Tax Act is against the law and facts of the case. The addition of Rs 2588200.00 was wrongly confirmed and needs to be deleted. 2. That there was no valid service of notices of hearing issued by the office of Worthy CIT(A) thereby no opportunity was provided to appellant to submit written submissions and evidences in support of ....
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....ntly, various notices followed u/s 142(1) on 05/07/2018, on 18/10/2018, on 06/11/2018, 28/11/2018 and lastly on 10/12/2018 (as evident from page - 2 of assessment order), but without any response and the assessment was ultimately completed ex-parte on a total income of Rs. 25.88 lakhs as unexplained investment u/s 68 of the Act, and the assessment order dated 26th December, 2018 (along with the demand notice u/s 156) was issued in the name of ' Kashmir Singh s/o Dalip Singh through legal heir Smt Sukhjit Kaur". 5. The matter carried in first appeal has been dismissed by the Ld. CIT(A), in absence of any response to notices issued on various dates (as evident from para 5.1 of the appeal order) and without any adjudication on the grounds of appeal contained in form 35 on merits. 6. Now the assessee is before the tribunal on the grounds contained in the memorandum of appeal and in course of hearing the Ld. AR of the assessee submitted at the very onset, that the assessee "Kashmir Singh" has already expired on 13th August, 2018, in support of which he filed a copy of the death certificate, which is placed on record (and incorporated in this order). 7. Thereafter, the Ld. AR re....
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....oceedings from the stage at which it stood on the date of death of the deceased. 9. The Ld. DR, requested a days time to go through the case records of ITO - ward 2(2), Amritsar, who sits in the same building where this bench of ITAT is located, and on his request the hearing was adjourned to the next day on 18th March, 2026. 9.1 However, on 18th March, 2026, ( the subsequent date of hearing ), the Ld DR expressed his inability to produce the assessment records or to clarify the basic issue, as to whether the statutory notice u/s 148, has been actually served on the assessee during his lifetime or not, and also failed to clarify as to whether fresh notices has been issued to the legal heirs of the deceased or not, (subsequent to the death of the assessee), as per requirement of provisions of section 159(2), for continuation of the ongoing assessment proceedings. 9.2 It is further submitted by the Ld AR, that the assessee ( Kashmir Singh ) even though alive on the date of issue of notice u/s 148 on 27th March, 2018, vide registered post, the said statutory notice could not be actually served on the assessee, by the postal authorities, and the same has returned back unserved....
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.... (c) Commissioner Of Income Tax Vs. Mani Kakar High Court Of Delhi (2009) 18 DTR (Del) 145 (2009) 178 Taxman 315. (d) Commissioner Of Income Tax Vs. MintuKalita High Court Of Gauhati (2001) 170 CTR (Gau) 149: (2002) 253 ITR 334 (Gau): (2001) 117 Taxman 388 (Gau). (e) Commissioner Of Income Tax Vs. Ashok Kumar Bharti & Vijay Kumar Goel High Court Of Allahabad (2005) 198 CTR (All) 260 (2006) 282 Taxman 496 (All): (2005) 149 Taxman 247. (f) Commissioner Of Income Tax Vs. Rajeev Sharma High Court Of Allahabad Lucknow Bench (2010) 232 CTR (A) 303 (2010) 192 Taxman 197 (2010) 40 DTR 129. (g) Commissioner Of Income Tax Vs. Cebon India Ltd. High Court Of Punjab & Haryana (2010) 229 CTR (P&H) 188: (2009) 184 Taxman 290: (2010) 34 DTR 119" 10. Regarding the other grounds of appeal on merits of the case, the Ld. AR of the assessee submitted fresh documents and made an application under Rule- 29 for admission of the same consisting of bank statements, evidence of land sale deed, copies of bank statement of son and wife of the assessee to explain the source of cash deposited in bank during the year under appeal, which according to the explanation filed, h....
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....taken on record and on the contrary the Ld DR has expressed his inability to confirm service of notice. 12.1 We find that in the instant case the notice u/s 148 was not served on the proper person during his lifetime, and it has been held in the case of PN Sasikumar Vs. CIT (1988) 170 ITR 80 (Ker. HC) that assessment in pursuance of such a notice was illegal and without jurisdiction and such a fundamental infirmity, could not be called a mere irregularity, which could be cured by relying on section 292B. 13. We further note that the Hon'ble jurisdictional High court ( Punjab & Haryana High Court), in the case of Vijay Kumar Jain Vs. CIT (1975) 99 ITR 349 (P & H ), has laid down the law, that the tribunal is bound to hear the assessee on the ground regarding the validity of notice under section 148 even though such ground was not pressed before the first appellate authority. 14. It has been further held by Hon'ble courts, that it is not enough that notice issued under section 148 somehow found its way to the proper assessee or the proper assessee appeared and filed an objection to the proceedings. Unless the notice is served on the proper person in the manner prescribed und....
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....has observed: "In the present case as admitted by the Respondent the facts are admitted. The death of the Assessee was duly communicated by his legal heirs (the Petitioner herein). The ITR also duly disclosed that the same has been filed by the legal representative. However, in ignorance of the said facts available on the record the scrutiny proceedings have been wrongly conducted in the name of the deceased Assessee without bringing on record all his legal heirs as per the requirement of law. 12. In the present case, the jurisdictional notice under Section 143(2) of the Act was issued against the dead person and the assessment order has also been passed against the dead person on his PAN without bringing on record all his legal representatives, therefore, the said assessment order and the subsequent notices are null and void and are liable to be set aside." 18. Before concluding we also refer to the decision of the Hon'ble MP High Court in the case of CIT v Prabhawati Gupta [1998] 231 ITR 188 (MP), where in an almost identical facts the Hon'ble court has observed as follows: "The brief facts giving rise to this reference are thus : The assessee, late ....
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....oceedings for assessment were completed. Since the proceedings had not been completed and it was yet to be completed; therefore, it was incumbent under s. 159(2) of the Act on the ITO to have brought legal representative of deceased on record and proceeded from the stage where it was left at the time of death of deceased. According to the findings of the Tribunal, the proceedings had not been completed before the death of the assessee, therefore, the Tribunal has rightly held that the assessment should be completed under s. 159(2) of the Act. In this view of the matter, we are of the opinion that the view taken by the Tribunal is correct and both the questions are answered against the Revenue and in favour of the assessee." 19. As such, respectfully following the law laid down by the Hon'ble courts, we are of the opinion that on facts of this case before us, both the legal grounds raised by the assessee firstly, regarding the non-service of notice u/s 148 and secondly non issue of any notice on the legal representatives or legal heir of the assessee as per provisions of section 159(2) of the Act, resulting in failure to bring the legal heirs on record and assessment order ultima....
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....s been taken from the original death record which is registered in the death register of Local Registrar, Births and Deaths, Municipal Corporation / Council / Sub-Centre West Zone, Block/ Block (P.H.C) Tehsil Amritsar- 1 District Amritsar of Punjab State for the year 2018. Typer e w/ Name of Deceased: flat / Sex: नौदलसमो ट से । Spouse Name: (43" e" 2/H / Father's Name: à¤à¤¿à¤œà¤° टी à¤à¤¾à¤—ा सा सà¤à¥€ / Name of Deceased's Mother à¤à¥‡à¤¡ पामयात/ Place of Death: à¤à¥‡à¤œ सी मिजी/ Date of Death: इसà¤à¥€à¤¤ मिंग/ Kashmir Singh à¤à¥‚तम/ Male NA UID/EID: Not Provided रहीम सिंग/ Dalip Singh मटवर वेळ Swaran Kaur Holy Heart Hospital Amritsar 13-Aug-2018 वनिमट तेसà¥à¤• तंचन / Registration No: 049/800252/2018/255047 तसि....
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....r Organization or Company or any other entity where this document is produced." The Content of this document could be verified using the document serial number at the following web link http://edistrict.punjab.gov.in/ 847/3 20 Subirit KL http://edistrict.punjab.gov.in/EDA/Reports/Certificate:)620Generation%20With%20Web.aspx?DSN=64118888og=c3RhdHVz&OutorView=1 Document 2 Ground 4 & 5 - Invalid service of Notice Inspection of assessment record and invalid service of notice u/s 148 1. The counsel for the appellant inspected the assessment records on 02.08.2019. During this inspection, it was found that: · Notice u/s 148 dated 27.03.2018, issued to the old village address VPO Pandori Waraich, Majitha Road, Amritsar, was returned undelivered. · The postal remark on the returned cover was that there were many persons of identical name in the village and notice could be served only if the father's name was mentioned. · The assessment records show that the notice u/s 148 was received back in the office on 05.04.2018. 2. Thus, there was no valid service of the notice u/s 148 on the assessee at any time prior to the completion of assessment. The A....