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TMI Blog2023 (5) TMI 163X X X X Extracts X X X X X X X X Extracts X X X X ..... Act for short). The relevant assessment year is 2017-2018. 2. The grounds raised read as follows:- 1. The learned assessing officer erred in levying the penalty, though your Appellant had disclosed the 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 eligible. 5. The learned assessing officer ought to have appreciated the amount received was only the balance consideration at the time of registration and part of the sale. 6. The learned assessing officer ought to have appre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving in the territory of India, the force of law . As per this principles Assessee discharged all applicable taxes and interest thereon before the assessment proceedings. 14. Since, there is no violation of Rule of Law under the Income Tax Act, 1961. Hence U/s 269SS of the LT. Act doesn't applicable to the Assessee because there is source of income or transactions relating to under the head of Income from Business / Profession during the assessment year to levy penalty U/s 271D of the Act against the legal representative of the deceased Assessee. 15. If penalty have been waived off under the principle of Natural Justice, there will not be any loss of revenue to the Department. Hence, your Appellant prays before your Hon'ble Authority and to direct the Assessing Authority to drop the penalty proceedings in the Interest of Justice and equity. 16. The appellant craves, leave to add, alter, amend, substitute, change and delete any grounds of appeal. 17. For the above and other grounds that may be urged at the time of hearing, the appellant prays that the appeal may be allowed and justice rendered. 3. The brief facts of the case are as follows: The as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 order is invalid. In support of the above conclusion, we rely on the following judicial pronouncements:- (i) The Hon ble Supreme Court in the case of ITO v. Bhupendra Bhikhalal Desai [2021] 131taxmann.com 40 (SC) held that: SLP dismissed against High Court s ruling that notice issued under section 153C against dead person is unenforceable in law and in such case revenue cannot contend that as they have no knowledge about death of assessee, they are entitled to plead that notice is not defective. (ii) The Hon ble Apex Court in the case of ITO Ward 1(3)(7), Surat v. Durlabhbhai Kanubhai Rajpara [2020] 114 taxmann. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore higher authorities. It is well settled that doctrine of res judicata/estoppel does not apply to the proceedings under the Act and that the consent of parties cannot confer jurisdiction upon an authority to do an act which such authority is not legally competent to do. The question whether an authority has jurisdiction to do an act depends not on the truth or falsehood of the facts into which such authority is called upon to enquire or upon the correctness of its findings on those facts, but upon their nature, and it is determinable at the commencement, not at the conclusion of the enquiry. A study of section 159 would make it clear that only those proceedings for making assessment or levying any sum may be taken against the deceased, 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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