SHRI MANGILAL GOTHI, V. THE ACIT 1 (1),

CO 60/IND/2008

• Counselvise Citation: [2010] 122 COUNSELVISE.COM (IT) 4654 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 8 month(s) 22 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 23-04-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 20-04-2010
• Assessment Year: 2004-2005
• Appeal Filed On: 01-08-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: H P VERMA
• Assessee Lawyers: K K SINGH
• Keywords: Validity of assessment

Judgement Text

PAGE 1 OF 8 - I.T.A.NO.298/IND/2008 ETC. MANGILAL GOTHI, BHOPAL. IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH : INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI V.K. GUPTA, ACCOUNTANT MEMBER PAN NO. : AAFHM4202-D I.T.A. NO. 298/IND/2008 A.Y.2004-05 ACIT, M/S. MANGILAL GOTHI ( HUF), 1(1), VS 9 TH LANE, SARAFA BAZAR, ITARSI. BHOPAL. APPELLANT RESPONDENT PAN NO. : AAFHM4202-D C.O.NO.60/IND/2008 (ARISING OUT OF I.T.A.NO. 298/IND/2008) M/S. MANGILAL GOTHI ( HUF), ACIT, 9 TH LANE, SARAFA BAZAR, ITARSI. VS 1(1), BHOPAL. CROSS OBJECTOR RESPONDENT APPELLANT BY : SHRI K.K.SINGH, CIT DR RESPONDENT BY : SHRI H.P. VERMA, ADV. DATE OF HEARING : 20.04.2010 O R D E R PER BENCH PAGE 2 OF 8 - I.T.A.NO.298/IND/2008 ETC. MANGILAL GOTHI, BHOPAL. THESE APPEALS FILED BY THE REVENUE AND CROSS OBJEC TIONS FILED BY THE ASSESSEES ARISE OUT OF ORDER OF LD. CIT(A)-I, B HOPAL, FOR ASSESSMENT YEAR 2004-05 AND INVOLVE COMMON ISSUES, HENCE, THES E WERE HEARD TOGETHER AND THESE ARE BEING DISPOSED OF THROUGH TH IS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. WE HAVE HEARD BOTH THE PARTIES AND HAVE ALSO PERUSE D THE MATERIAL AVAILABLE ON RECORD. 3. FIRST, WE SHALL TAKE UP THE REVENUES APPEAL IN I.T .A.NO. 298/IND/2008. 4. IN GROUND NO.1, THE REVENUE IS AGGRIEVED BY THE DE CISION OF THE LD. CIT(A) IN DELETING THE ADDITION OF RS. 5,56,832 /- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED CASH CR EDIT IN THE BANK ACCOUNT. 5. THE FACTS, IN BRIEF, ARE THAT IN THE COURSE OF ASSE SSMENT PROCEEDINGS, THE A.O. NOTED THAT THE ASSESSEE HAD S HOWN AGRICULTURE INCOME OF RS. 4,50,500/- APART FROM INTEREST INCOME . THE A.O. REQUIRED THE ASSESSEE TO SUBMIT THE DOCUMENTARY EVIDENCE TO SUBSTANTIATE ITS CLAIM OF AGRICULTURE INCOME. THE ASSESSEE SUBMITTED DOCUM ENTARY EVIDENCES AS REGARD TO THE NATURE OF AGRICULTURE PRODUCE AND SAL E THEREOF. HOWEVER, THE A.O. FOUND THAT ON THE BILL FOR SALE OF SOYA THE NA ME OF PURCHASER WAS NOT MENTIONED. SIMILARLY, IN RESPECT OF SUGAR CANE SALE S, THE DETAILS GIVEN BY PAGE 3 OF 8 - I.T.A.NO.298/IND/2008 ETC. MANGILAL GOTHI, BHOPAL. THE ASSESSEE, THERE WERE CERTAIN DISCREPANCIES AND, THEREFORE, THE A.O. HELD THAT SUCH INFORMATIONS WERE MISLEADING AND COU LD NOT BE RELIED TOTALLY. THE A.O. ALSO EXAMINED THE AGRICULTURE LA ND HOLDINGS AND ALSO FOUND THAT THE ASSESSEE HAD NOT GIVEN ANY EVIDENCE FOR AGRICULTURE OPERATIONS/EXPENSES. ACCORDINGLY, THE A.O. TREATED AGRICULTURE INCOME SHOWN BY THE ASSESSEE AS UNDISCLOSED INCOME CHARGEA BLE TO TAX. AGGRIEVED BY THIS, THE ASSESSEE CARRIED THE MATTER INTO APPEAL BEFORE THE LD. CIT(A), WHEREIN DETAILS OF CROPS, SALE CONSIDER ATION RECEIVED FOR SUCH CROPS AND DETAILS OF DEPOSITS IN THE BANK ACCOUNT W ERE ALSO FILED. THE LD. CIT(A) EXAMINED SUCH DETAILS AND FOUND THAT THE A.O . HAD ADDED ENTIRE SUM WITHOUT EVEN VERIFYING THAT SUM OF RS. 1.65 LAK HS HAD BEEN DEPOSITED IN THE PERIOD PERTAINING TO ASSESSMENT YEAR 2005-0 6. 6. THE LD. CIT(A) ALSO HELD THAT THE DEPOSITS TO THE T UNE OF RS. 3,91,832/- WERE OUT OF AGRICULTURE INCOME. HENCE, H E DELETED THE ENTIRE ADDITION. AGGRIEVED BY THIS, THE REVENUE IS IN APPE AL BEFORE US. 7. THE LD. DEPARTMENTAL REPRESENTATIVE NARRATED THE FA CTS AND PLACED STRONG RELIANCE ON THE ORDER OF A.O. 8. THE LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, SUBMITTED THAT THE TRIBUNAL IN THE CASE OF MANGILAL GOTHI (INDIVIDUAL) IN I.T.A.NO. 78/IND/2005 IN THE COURSE OF SEARCH ASSES SMENT AND HELD THAT THE ASSESSEE WAS HAVING SUFFICIENT AGRICULTURE INCO ME AND THE AMOUNT OF PAGE 4 OF 8 - I.T.A.NO.298/IND/2008 ETC. MANGILAL GOTHI, BHOPAL. DEPOSIT MADE IN THE BANK WAS OUT OF SUCH AGRICULTUR E INCOME. HENCE, NO ADDITION COULD BE MADE FOR AMOUNTS DEPOSITED IN THE BANK AS THE SOURCE THEREOF STOOD EXPLAINED. THE LEARNED COUNSEL FOR TH E ASSESSEE SUBMITTED THAT THE FACTS OF THE PRESENT CASE WERE IDENTICAL A ND THAT WAS ALSO A CASE OF CONNECTED ASSESSEE RATHER OF KARTA OF ASSESSEE HUF, HENCE, THE ISSUE WAS COVERED IN FAVOUR OF THE ASSESSEE. 9. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES, MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. 10. IT IS NOTED THAT THE ASSESSEE WAS HAVING ONLY AGRIC ULTURE INCOME AND INTEREST INCOME ETC. AND THE ASSESSEE HAS SUBMI TTED AN ENOUGH DOCUMENTARY EVIDENCE TO BE JUSTIFIED THE QUANTUM OF SALE PROCEEDS AS WELL AS THE AGRICULTURE INCOME, WHICH IS AVAILABLE WITH IT ON THE DATE OF DEPOSITS OF CASH IN THE BANK ACCOUNT. WE FURTHER F IND THAT A SUM OF RS. 1.65 LAKHS HAS NOT BEEN DEPOSITED IN THE YEAR UNDER CONSIDERATION, HENCE, THE SAME CANNOT BE ADDED AT ALL AND WHICH FACT ALSO SHOWS THE APPROACH OF THE A.O. IN MAKING SUCH ADDITION. IN VIEW OF THE SE FACTS, WE DO NOT FIND ANY MERIT IN THIS GROUND OF THE REVENUE. THE S AME IS, THEREFORE, DISMISSED. 11. IN OTHER GROUND, THE REVENUE IS REVENUE IS AGGRIEVE D BY THE DECISION OF THE LD. CIT(A) IN DELETING THE ADDITION OF RS. 8,78,714/- MADE PAGE 5 OF 8 - I.T.A.NO.298/IND/2008 ETC. MANGILAL GOTHI, BHOPAL. BY THE ASSESSING OFFICER BY DISALLOWING THE CLAIM O F THE ASSESSEE IN RESPECT OF AGRICULTURE INCOME. 12. THE A.O. FOUND THAT THE ASSESSEE HAD SHOWN RECEIPTS FROM SALE OF AGRICULTURE PRODUCE. HOWEVER, THE SAME COULD NOT BE CONSIDERED AS GENUINE FOR THE REASON THAT LAND WAS NOT SUFFICIENT NOR THE ASSESSEE HAD SUBMITTED DOCUMENTARY EVIDENCES TO PROVE AGRICULTUR E EXPENSES INCURRED BY THE ASSESSEE. HENCE, THE A.O. TREATED THE TOTAL RECEIPTS AS UNDISCLOSED INCOME OF THE ASSESSEE. AGGRIEVED BY THIS, THE ASSE SSEE CARRIED THE MATTER INTO APPEAL BEFORE THE LD. CIT(A), WHEREIN THE ASSE SSEE MADE THE DETAILED SUBMISSIONS AS REGARD TO LAND HOLDINGS, SALE OF AGR ICULTURE PRODUCE THROUGH MANDI SAMITI, THE DETAILS OF EXPENSES INCUR RED FOR EARNING SUCH AGRICULTURE INCOME AND CARRYING ON OF AGRICULTURE O PERATIONS. IT WAS ALSO CONTENDED THAT ONLY NET AGRICULTURAL INCOME COULD B E ADDED AT THE MOST. HOWEVER, THE SAME WAS ALSO NOT REQUIRED AS DEPOSITS IN THE BANK HAD ALREADY BEEN ADDED. THE ASSESSEE ALSO SUBMITTED THA T THE YIELD OF RS. 10,250/-PER ACRE WAS SHOWN, WHICH WAS VERY REASONAB LE. THE LD. CIT(A) HELD THAT THE ASSESSEE SUFFICIENTLY PROVED THE FACT UM OF AGRICULTURE INCOME. HOWEVER, YIELD PER ACRE OF RS. 10,250/- SHO WN BY THE ASSESSEE APPEARED TO BE ON HIGHER SIDE, HENCE, HE ACCEPTED T HE NET AGRICULTURE INCOME AT RS. 4 LAKHS IN RESPECT OF RS. 4,50,500/- AND CONFIRMED THE PAGE 6 OF 8 - I.T.A.NO.298/IND/2008 ETC. MANGILAL GOTHI, BHOPAL. ADDITION OF RS. 50,500/-. AGGRIEVED BY THIS, BOTH R EVENUE AS WELL AS ASSESSEE ARE IN APPEAL BEFORE US. 13. THE LD. DR NARRATED THE FACTS AND PLACED RELIANCE O N THE ORDER OF THE AO. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OT HER HAND, PLACED STRONG RELIANCE ON THE ORDER OF THE LD. CIT(A). 14. THE LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, CONTENDED THAT THE ASSESSEE WAS ENGAGED IN AGRICULT URE ACTIVITIES ON ITS OWN LAND AS WELL AS ON THE LAND OBTAINED BY IT FOR AGRICULTURE OPERATIONS ON LEASE BASIS. THE ASSESSEES FAMILY WAS HAVING MU CH AGRICULTURE LAND AT THEIR DISPOSAL. IT WAS ALSO CONTENDED THAT CROP LOA N HAD ALSO BEEN OBTAINED FROM THE BANK, WHICH FURTHER ESTABLISHED THE EXISTE NCE OF AGRICULTURAL ACTIVITIES UNDER TAKEN BY THE ASSESSEE. THE LEARNED COUNSEL FURTHER SUBMITTED THAT THE DOCUMENTARY EVIDENCES AS REGARD TO SALE PROCEEDS WERE ALSO SUBMITTED AND MERELY BECAUSE THE ASSESSEE HAD NO TAXABLE INCOME AND THE ASSESSEE HAD NOT FILED ANY RETURN OF INCOME PRIOR TO SEARCH, HENCE, THE VIEW OF A.O. THAT THE ASSESSEE HAD NO AGRICULTU RE INCOME ON EARLIER OCCASIONS WAS A CASE OF PRESUMPTION ONLY. THE ASSES SEE FURTHER CONTENDED THAT YIELD OF RS. 10,500/- PER ACRE SHOWN BY IT WAS MOST REASONABLE HAVING REGARD TO THE NATURE OF AGRICULTU RE PRODUCE. THE ASSESSEE FURTHER CONTENDED THAT THE TRIBUNAL IN THE CASE OF SHRI MANGILAL KESHRICHAND GOTHI AND OTHERS HAD ALSO ACCEPTED THE CLAIM OF THE ASSESSEE PAGE 7 OF 8 - I.T.A.NO.298/IND/2008 ETC. MANGILAL GOTHI, BHOPAL. AS REGARD TO THE AGRICULTURE INCOME AND THE FACTS O F THIS CASE WERE IDENTICAL TO THE FACTS OF THAT CASE. HENCE, THIS IS SUE WAS ALSO COVERED IN FAVOUR OF THE ASSESSEE. 15. THE LEARNED COUNSEL IN THIS REGARD REFERRED TO THE OBSERVATIONS OF THE TRIBUNAL IN THAT CASE AT PAGES 14,15 & 16 OF THE SAID ORDER OF THE TRIBUNAL, WHEREIN THE CASH FOUND AT THE TIME OF SEA RCH WAS ACCEPTED AS EXPENDITURE FROM SUCH AGRICULTURE INCOME. 16. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES, MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. 17. ADMITTEDLY, THE ASSESSEE AHS SUBMITTED VARIOUS DOCU MENTARY EVIDENCES TO JUSTIFY ITS CLAIM OF AGRICULTURE INCOM E AND THE A.O. HAS MERELY DISBELIEVED THIS CLAIM OF THE ASSESSEE FOR O NE OR OTHER REASON, WHICH ACTION OF THE A.O., IN OUR OPINION, IS NOT JU STIFIED. IN OUR OPINION, THE LD. CIT(A) HAS EXAMINED THE ISSUE IN PROPER PER SPECTIVE AND HAS CORRECTLY ARRIVED AT THE VALUE OF THE AGRICULTURE I NCOME. ACCORDINGLY, ALL GROUNDS OF THE REVENUE ARE DISMISSED. 18. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. 19. NOW, WE SHALL TAKEN UP THE CROSS OBJECTION NO. 60/I ND/2008. 20. GROUND NO.1 RELATING TO THE VALIDITY OF ASSESSMENT ORDER WAS NOT PRESSED, HENCE, DISMISSED, AS NOT PRESSED. PAGE 8 OF 8 - I.T.A.NO.298/IND/2008 ETC. MANGILAL GOTHI, BHOPAL. 21. IN GROUND NO.2, THE ASSESSEE IS AGGRIEVED BY THE D ECISION OF LD. CIT(A) IN SUSTAINING THE ADDITION OF RS. 50,500/- O N ACCOUNT OF AGRICULTURE INCOME TREATED AS INCOME FROM UNDISCLOS ED SOURCES. THE FACTS HAVE ALREADY BEEN NARRATED BY DISPOSING OF THE RELE VANT GROUND IN THE REVENUES APPEAL, HENCE, NOT REPEATED. 22. BOTH THE PARTIES HAVE REITERATED THEIR RESPECTIVE S TAND. IN VIEW OF OUR FINDINGS GIVEN IN THE REVENUES APPEAL, WE H OLD THAT THE AGRICULTURE INCOME ESTIMATED BY THE CIT(A) IS REASO NABLE AND NEED NO INTERFERENCE FROM OUR SIDE. THE SAME IS, THEREFORE, DISMISSED. 23. IN THE RESULT, THE CROSS OBJECTION IS DISMISSED. 24. TO SUM UP, BOTH REVENUES APPEAL AS WELL AS CROSS O BJECTION ARE DISMISSED. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 23 RD APRIL, 2010. SD/- SD/- (JOGINDER SINGH) (V. K. GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 23 RD APRIL, 2010. CPU* 20214