TMI Blog2015 (8) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... ect the AO to tax the income from the estate of late Shri B.D. Gupta for the year under consideration in terms of section 168 of the Act. In so far as the assessee under consideration is concerned, there cannot be any inclusion of business or interest income in its hands. - ITA No.5636/Del/2014 - - - Dated:- 31-7-2015 - SHRI R.S. SYAL, JJ. For The Assessee : Shri M.P. Rastogi, Advocate Ms Lalitha Krishnamurthy, CA For The Department : Shri Om Prakash Meena, Sr.DR ORDER This appeal by the assessee is directed against the order passed by the CIT(A) on 21.7.2014 in relation to Assessment Year 1992-93. 2. This is third round of proceedings before the Tribunal. Briefly stated, the facts of the case are that the assessee filed return declaring income of ₹ 67,910/- in the capacity of B.D. Gupta Sons (HUF). The assessment was finalized on protective basis. At this juncture, it is relevant to mention that Shri B.D. Gupta expired intestate in 1970. Before his death, he had certain house properties giving income under the head Income from house property. Apart from that he had also set up a business in the name and style of `Gupta Sports House . Litiga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment. The assessee is in appeal before the Tribunal challenging the decision of the ld. CIT(A) qua business income and interest income. No material has been brought on record to show that the Revenue has also filed any appeal against the impugned order. As such, I am proceeding to dispose of the issues taken up by the assessee in its appeal. 4. I have heard the rival submissions and perused the relevant material on record. The short question before me is as to whether or not the business and interest income should be included in the assessee HUF s total income. In this regard, it is significant to go through the verdict of the Single Judge of the Hon ble Delhi High Court, a copy of which is available at page 46 onwards of the paper book. In para 15, the Hon ble High Court vide its interim order, has held that: there are strong indications that all the properties were self acquired by B.D. Gupta. It is well settled law that if a property stands in the name of a person, the same is to be treated as self acquired property Again, on page 12, it has been emphatically held that: The aforesaid recital clearly shows that B.D. Gupta acquired the property with his own funds and not w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... F. I, therefore, hold that the decision of the ld. CIT(A) in directing the business and interest income to be taxable in the hands of HUF, is not sustainable. 7. As noted above, the ld. AR heavily relied on the case of Ch. Atchaiah (supra) in which it has been held that only the right person is to be assessed. The judgment does not end there. It has further been held that merely because a wrong person is taxed with respect to a particular income, the AO is not precluded from taxing the right person with respect to that income. Their Lordships laid down that : `Under the present Act, the ITO .. can, and he must, tax the right person and the right person alone. By right person , is meant the person who is liable to be taxed, according to law, with respect to a particular income. .. . Where a person is taxed wrongfully, he is no doubt entitled to be relieved of it in accordance with law but that is a different matter altogether. The person lawfully liable to be taxed can claim no immunity because the AO (ITO) has taxed the said income in the hands of another person contrary to law . The crux of the judgment is that if a wrong person has been assessed, then the ITO must assess co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax on the income of the deceased in the same manner as the deceased would have paid if he had not died. Any proceedings taken against the deceased before his death shall be continued against the legal representative and, further, any proceedings which could have been taken against the deceased if he had survived may also be taken against the legal representative. The crux of the matter is that legal representative is, inter alia, liable to pay tax in respect of income of the deceased from the beginning of the year up to the date of his death. 10. Section 168 deals with income of the estate of deceased person. The relevant part of this section reads as under : - 168. (1) Subject as hereinafter provided, the income of the estate of a deceased person shall be chargeable to tax in the hands of the executor,- (a) if there is only one executor, then, as if the executor were an individual; or (b) if there are more executors than one, then, as if the executors were an association of persons; and for the purposes of this Act, the executor shall be deemed to be resident or non-resident according as the deceased person was a resident or nonresident during the previous year in w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , whichever is earlier, in the hands of the executors. 12. Adverting to the facts of the instant case, it is observed that the Hon ble Delhi High Court vide its interim order dated 17.2.1984, determined 60% share as undisputed leaving 40% as disputed. Accordingly, a Receiver was appointed to collect rent from all the tenants and also make inventory of goods in the business of M/s Gupta Sports House. A final settlement was arrived at amongst all the family members only in the year 2004. It shows that up to November, 2014, there were no determined shares of the litigants in the house properties and business under the name and style of Gupta Sports House. Going by the prescription of section 168, total income from the estate of late Shri B.D. Gupta, except to the extent of distributed to or applied for the benefit of specific legatees, is required to be charged to tax in the hands of the executor and not the assessee HUF. It is obvious that once an income has arisen from the estate of a deceased and there are provisions under the Act mandating the charge thereon, such income cannot go tax free. I, therefore, direct the AO to tax the income from the estate of late Shri B.D. Gupta fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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