Meaning of "Deemed to be an Assessee"

 Under the Income Tax Act, 1961, the term “deemed to be an assessee” refers to a person who is not originally liable to pay tax, but the law treats (or “deems”) them as an assessee for specific legal and tax purposes.

 This concept appears under Section 2(7) of the Income Tax Act, which defines three types of assessees:

1.      Assessee

2.      Deemed Assessee

3.      Assessee in Default

 Deemed Assessee – Meaning

A “deemed assessee” is a person who is legally treated as an assessee, even though the income or default may pertain to someone else.

 Examples of Deemed Assessee

Scenario	Who is the Deemed Assessee?
Legal heir receiving income or property of a deceased person	Legal heir is deemed to be an assessee for that income
Guardian of a minor earning taxable income	Guardian is deemed to be the assessee for child’s income
Trustee managing trust property or income	Trustee is deemed to be assessee for trust’s income
Partner of a firm filing return on behalf of the firm	Partner is deemed assessee for firm's income
Representative of a non-resident	Agent in India is deemed to be an assessee

 Example 1: Legal Heir of Deceased

Mr. Ramesh dies in January 2025, leaving ₹5,00,000 rental income for FY 2024–25.
His son files the return and pays tax.

 Here, the son is deemed to be an assessee, even though income originally belonged to his father.

 Example 2: Trustee of a Trust

A trust earns ₹10,00,000 in donations and investments. The trustee files the return.

The trustee is a deemed assessee for income belonging to the trust.

 Summary:

Term	Meaning
Assessee	Person liable to pay tax on their own income
Deemed Assessee	Person who is treated as liable for tax on someone else's income
Assessee in Default	Person who fails to deduct/pay tax as required

 Here’s a clear explanation of the two phrases:

1. Every person who is deemed to be an assessee under any provision of this Act
2. Every person who is deemed to be an assessee-in-default under any provision of this Act

These are part of the inclusive definition of "assessee" under Section 2(7) of the Income-tax Act, 1961.

1. "Deemed to be an Assessee" – Explained

A person is deemed to be an assessee when they are not directly liable for income, but the law treats them as responsible for tax purposes due to their relation with someone else's income or asset.

🔍 Examples:

Scenario	Who is Deemed Assessee?
Legal heir files return of deceased parent	Legal heir
Trustee managing income of a trust	Trustee
Guardian of a minor child earning income	Guardian
Partner filing return on behalf of a dissolved partnership firm	Partner
Representative of a non-resident	Agent in India (u/s 163)

 2. "Deemed to be an Assessee-in-Default" – Explained

A person is deemed to be an assessee-in-default when they fail to perform certain tax-related duties, such as deducting or depositing TDS, even if they are not the one earning the income.

🔍 Examples:

Scenario	Who is Deemed Assessee-in-Default?
Employer fails to deduct TDS on employee's salary	Employer
Bank does not deduct TDS on interest payments	Bank
Buyer of property doesn't deduct TDS @1% (u/s 194-IA)	Buyer
Tenant fails to deduct TDS on rent payment to NRI (u/s 195)	Tenant
Company fails to pay advance tax or TDS	Company

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📌 Summary Table

Type	What it Means	Example
Deemed Assessee	Person treated as responsible for someone else’s income	Legal heir, trustee, guardian
Deemed Assessee-in-Default	Person fails in tax duty (like TDS deduction)	Employer, buyer of property, tenant, company