Should Return Filing Discontinued in Case Of Death of an Individual?
My aunt died on 18.04.2009. whether her income tax file should be filed for the assessment year 2009-10 or not ?. if not then why and if yes then who will sign the ITR papers in what capacity ?. Shall her file continue to be filed there after or discontinue ?. what will be the status for filling ITR in future?ANIL ARORA
Income Tax Act provides for taxing income of earning of deceased if the same is earned by the deceased even after death.It should also be filed if the assets of the deceased which earns income has not been transferred to his/her heir. So, question of discontinue arises only if the earning income in the name of deceased has stopped .
All income which was earned during the life time of deceased person should be assessed in hand of legal representative(s) as per section 159 of the I T Act.Therefore , in such case , legal representative should file the return of the deceased person.For example , in your case ,since your aunt had taxable income for the FY 2008-09 before her death , her return has to be filed u/s 159 of the I T Act despite the fact that she has expired
Who is/are Legal Representatives? Legal representative is defined u/s 2(29) of the I T Act as same having meaning assigned to it in clause (11) of section 2 of the Code of Civil Procedure 1908 which states
“means a person who in law represents the estate of a deceased person, and includes any person who inter meddles with the estate of the deceased and where a party sues or is sued in a representative character the person on whom the estate devolves on the death of the party so suing or sued;”
In practical terms , the heir himself if there is only one or if there is more than one heir , should first make an agreement among different heirs so that others assign one person as legal representative for the purpose of income tax matter. That person can sign the return of the deceased person and can appear before the assessing officer in case of any proceedings.
Already detailed answer to question regarding tax liability of a deceased person has been answered on this blog earlier. Read this posting for knowing more .