Delay By State To Issue Necessary Certificates: ITAT Quashes Revision Order

The Calcutta Bench of Income Tax Appellate Tribunal (ITAT) has quashed the revision proceedings initiated in the name of the deceased person.

The revenue department acted quickly after receiving the legal heir certificate, according to the two-member bench of George Mathan (Judicial Member) and Arun Khodpia (Accountant Member). However, there has been a delay at the level of the state government in issuing the necessary certificates. Fault cannot be placed on the revenue or the assessee.

The assessee's term ended on October 12, 2020. The information regarding the death of the assessee has been orally intimated to the Assessing Officer. Odisha's government only issued the death certificate on 8.3.2021. As the death certificate had been issued only on 8.3.2021, the assessee had applied for a legal heir certificate, which was issued on 28.2.2022.

The legal heir did not know the proceedings had been initiated under Section 263 of the Act. They couldn't upload the information to the income tax portal without a legal heir certificate because the information wouldn't be accepted unless they had both a death certificate and a legal heir certificate.

The legal heir contended that the order passed under Section 263 was on a deceased assessee and, therefore, the order under Section 263 is liable to be quashed.

The department contended that there is no information available with the PCIT in respect of the death of the assessee. Therefore, it cannot be held that the Pr. CIT has passed an order under Section 263 of the Act on a deceased assessee. He had no objections to the matter being returned to the file of the Pr. CIT for redoing the order on the legal heir after a fair hearing.

The ITAT noted that, on the death of an individual, the government draws information in respect of death from the cremation spot or on the basis of a doctor's death certificate. The state government then issued the death certificate within 7–14 days. The legal heir certificate was applied for and obtained. The COVID period lasted from 2020 to 2021. The assessee died of cancer on October 12, 2020. The death certificate has been issued after nearly four months.

The ITAT observed that there is no provision under which the legal heir could have intimated the revenue regarding the death of the assessee as they had no certificate issued by the statutory authorities to prove the death. Without the statutory authority certificate, the revenue would not accept the fact of the death either. It is only after obtaining the death certificate that the legal heir certificate can be applied for. The legal heir certificate has been issued to the assessee on 28.2.2022.

The tribunal held that the addition in the appeal was Rs. 11 lakhs, and as the order has been passed on to a deceased assessee, it stands quashed.

Case Title: Kusum Mehta Versus CIT

Citation: ITA No.32/CTK/2022

Date: 18/01/2023

Counsel For Appellant: Mohit Sheth

Counsel For Respondent: M.K.Gautam

Click Here To Read The Order