1983 (11) TMI 154 - AT - Income Tax

Appellate Assistant Commissioner Assessment Proceedings Assessment Year Reassessment Proceedings

Issues Involved:
1. Competency of Smt. Prabha Golecha to file returns and appeals on behalf of her missing husband, Shri Hemchand Golecha.
2. Validity of the appeals filed by Smt. Prabha Golecha under the Income-tax Act and Wealth-tax Act.
3. Presumption of death under Section 108 of the Indian Evidence Act, 1872.
4. Definition and scope of 'assessee' and 'aggrieved assessee' under Sections 2(7), 246, and 253 of the Income-tax Act.
5. Procedural irregularity in the title of appeals and its impact on the validity of appeals.

Issue-wise Detailed Analysis:

1. Competency of Smt. Prabha Golecha to File Returns and Appeals:
The Tribunal examined whether Smt. Prabha Golecha was competent to file returns and appeals on behalf of her husband, Shri Hemchand Golecha, whose whereabouts have been unknown since 7-7-1976. The IAC (Assessment) had issued notices under various sections of the Income-tax Act and Wealth-tax Act to Shri Hemchand Golecha, but no returns were filed in response. Smt. Prabha Golecha filed returns on behalf of her husband, but they were not accepted as she was deemed not competent to file them without proper authorization or proof of her husband's death. The appeals filed by her were dismissed in limine by the Commissioner of Income-tax (Appeals) and the Commissioner of Wealth-tax (Appeals) on similar grounds.

2. Validity of Appeals Filed by Smt. Prabha Golecha:
The Tribunal considered the argument that Smt. Prabha Golecha could not file appeals without authorization from her husband or proof of his death. It was noted that no valid authorization was established, and the death of Shri Hemchand Golecha had not been proved. However, the Tribunal held that Smt. Prabha Golecha, being an 'assessee aggrieved' within the meaning of Sections 246 and 253, read with Section 2(7) of the Income-tax Act, was entitled to file appeals. The Tribunal emphasized that the tax demand arising from the assessments would be recoverable from her and/or her sons, making her an 'assessee' for all purposes.

3. Presumption of Death Under Section 108 of the Indian Evidence Act, 1872:
Smt. Prabha Golecha's representative argued that under Section 108 of the Indian Evidence Act, Shri Hemchand Golecha, who had not been heard for seven years, should be presumed dead. However, the Tribunal clarified that Section 108 only presumes death after seven years of being unheard, without specifying the exact date of death. Since the appeals were filed before the seven-year period elapsed, the presumption of death could not be applied retroactively to validate the appeals.

4. Definition and Scope of 'Assessee' and 'Aggrieved Assessee':
The Tribunal analyzed whether Smt. Prabha Golecha could be considered an 'assessee' and 'aggrieved assessee' under the Income-tax Act. It was concluded that she met the criteria as the tax demand would be enforced against her. The Tribunal cited the Supreme Court's observation in Adi Pherozshah Gandhi v. H. M. Seervai, stating that a 'person aggrieved' must be deprived of a benefit due to the order. Since the IAC's orders caused a legal grievance to Smt. Prabha Golecha, she was deemed an 'aggrieved assessee.'

5. Procedural Irregularity in the Title of Appeals:
The Tribunal addressed the issue of procedural irregularity, where the appeals were filed in the name of Shri Hemchand Golecha but signed by Smt. Prabha Golecha. It was held that this constituted an irregularity, not an invalidity. The Tribunal directed that the defect in the title should be corrected by substituting Shri Hemchand Golecha's name with Smt. Prabha Golecha's name within a specified period. The Tribunal emphasized that compliance with rule 45 was achieved as the appeals were signed by Smt. Prabha Golecha, who was competent to file them.

Conclusion:
The Tribunal concluded that the appeals were not invalid but suffered from a procedural irregularity that could be rectified. The Commissioner of Income-tax (Appeals) and the Commissioner of Wealth-tax (Appeals) were instructed to order the appellant to correct the title defects and then dispose of the appeals on merits. The Tribunal allowed all the appeals, directing the appellant to amend the titles within eight days from the receipt of the order, failing which the appeals would stand dismissed for non-prosecution.

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