Shri Jayeshbhai J. Amin, Ankleshwar V. The Income Tax Officer, Ward- 2(2), Bharuch

ITA 1040/AHD/2016

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 7239 (ITAT-SURAT)
• Duration Of Justice: 3 year(s) 2 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 26-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J K CHANDNANI
• Assessee Lawyers: AMAR K SHAH
• Keywords: Unexplained cash credit; Principle of natural justice; Peak credit; Additional evidence; Reasonable cause

Judgement Text

SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 1 OF 18 , , IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER . . ./ I.T.A. NO.1040/AHD/2016 [ [ / ASSESSMENT YEAR : 2010-11 SHRI JAYESHBHAI J AMIN, GUJARAT TYRES, C/1/3, AMBICA COMPLEX, BELOW DENA BANK, STATION ROAD, ANKLESHWAR 393 002. [PAN: AGDPA 1947 M] VS. THE INCOME TAX OFFICER , WARD-4, BHARUCH. APPELLANT /RESPONDENT [ /ASSESSEE BY SHRI AMAR K.SHAH AR /REVENUE BY SHRI J.K.CHANDNANI SR.DR / DATE OF HEARING: 22 . 0 7 .201 9 /PRONOUNCEMENT ON: 23 .0 7 .2019 /O R D E R PER O.P.MEENA, AM: 1. THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX(APPEALS)-3, VADODARA(IN SHORT THE CIT(A)) DATED 12.01.2016 PERTAINING TO ASSESSMENT YEAR 2010-11. 2. THE GROUNDS RAISED BY THE ASSESSEE READ AS UNDER : 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD.COMMISSIONER OF INCOME TAX (APPEALS)-3, VADODARA HAS ERRED IN TREATING AGRICULTURE INCOME OF RS.3,59,730 AS UNEXPLAINED INCOME. SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 2 OF 18 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASES LD.COMMISSIONER OF INCOME TAX (APPEALS)-3, VADODARA HAS ERRED IN IGNORING OPENING CASH ON HAND WITH THE APPELLANT FOR CALCULATION OF AVAILABLE CASH ON HAND AND ADDITION OF UNEXPLAINED CASH CREDIT. 3. GROUND NO.1 STATES THAT THE LD.CIT(A) HAS ERRED IN TREATING AGRICULTURAL INCOME OF RS.3,59,730/- AS UNEXPLAINED INCOME. 4. BRIEFLY STATES FACTS OF THE CASE ARE THAT THE ASSESSE IS A PARTNER IN M/S.GUJARAT TYRES AND DERIVED INCOME BY WAY OF REMUNERATION, INTEREST AND PARTNERSHIP SHARE. BESIDES THIS, THE ASSESSEE HAS SHOWN AGRICULTURAL INCOME OF RS.5,59,730/-. THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE DO NOT HAVE ANY NO OTHER SOURCE OF INCOME. THE PERUSAL OF INCOME OF EXPLAINED STATEMENT OF AGRICULTURAL INCOME REVEALED THAT THE ASSESSEE HAD GROSS AGRICULTURAL INCOME OF RS.9,44,850/- AND SHOWN NET AGRICULTURAL INCOME AT RS.5,59,730/-. THE ASSESSEE WAS THEREFORE ASKED TO FURNISH PROOF OF AGRICULTURAL ACTIVITIES CARRIED OUT BY HIM WITH EVIDENCES. 5. IN RESPONSE TO WHICH THE ASSESSEE HAS FILED COPIES OF 5 BILLS SHOWING THE SALE PROCEEDS AMOUNTING TO RS.16,95,625/-. HOWEVER, THE ASSESSING OFFICER (AO) FIND THAT THERE ARE DISCREPANCIES IN THE SERIAL NUMBER OF BILLS ISSUED AND DATES. THEREFORE, THE AO HAS ALSO EXAMINED THE TWO PARTIES WHO HAVE DENIED TO HAVE ISSUED BILL TO THE SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 3 OF 18 ASSESSEE. THEREFORE, THE ASSESSING OFFICER CONCLUDED THAT THE ASSESSEE DOES NOT HAVE ANY SUPPORTING DOCUMENT OR PROOF, ACCORDINGLY THE AO DISALLOWED THE AGRICULTURAL INCOME OF RS.5,59,730/- TREATING THE SAME AS INCOME FROM OTHER SOURCES AND ADDED THE SAME TO THE TOTAL INCOME. 6. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A) WHEREIN A REMAND REPORT WAS CALLED FOR FROM THE AO WHO HAS SUBMITTED REMAND REPORT DATED 04.06.2015 WHEREIN DETAILS REGARDING COPY CERTIFICATE ISSUED FOR THE SHRI J.J.PATEL, COPY OF REGISTER IN WHICH ENTRY WAS MADE OF SAID CERTIFICATE AND ALL ABSTRACT OF LAND HOLDING B SHRI J.J.PATEL AND PROOF OF BASIS ON WHICH THE CERTIFICATE OF AGRICULTURAL INCOME WAS ISSUED TO SHRI J.J.PATEL FILED FROM THE TALATI MANTRI, BHADRESAR. THE AO OBSERVED THAT ON VERIFICATION OF CERTIFICATE ISSUED BY TALATI CUM MANTRI STATES THAT THE ASSESSEE HAS I.E. SHRI J.J.PATEL HAD GROWN COTTON AND WHEAT IN THIS LAND, BLOCK NO.3(3) AND EARNED INCOME OF RS.7,85,000/- FROM THE FINANCIAL I.E. A.Y. 2010-11. HOWEVER, THE AO DID NOT ACCEPTED THE SAID CERTIFICATE ON THE GROUND THAT THIS WAS ISSUED BY TALATI MANTRI AND NOT BY THE MALAPTDAR OF KARJANI. SIMILARLY, THE TALATI MANTRI, BHADRESAR WAS NOT SUBMITTED ANY DETAILS CALLED FOR. THE COPY OF SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 4 OF 18 REMAND REPORT WAS GIVEN TO THE ASSESSEE AND WHO HAS FILED HIS REPLY WHICH HAS BEEN REPRODUCED BY THE LD.CIT(A) AT PAGE 45 TO 49 OF THE APPELLATE ORDER. THE LD.CIT(A) VIDE PARA 13 OF HIS ORDER AS REJECTED THE OBJECTION OF THE AO REGARDING ADMISSION OF ADDITIONAL EVIDENCE UNDER RULE 46A(1D) ON THE GROUND THAT THESE COULD NOT PRODUCED BEFORE THE AO FOR THE REASONABLE CAUSE, HENCE SAME WERE ALLOWED TO BE ADMITTED. THE LD.CIT(A) OBSERVED THAT THE APPELLANT VIDE HIS SUBMISSION DATED 09.01.2015 HAS SUBMITTED COPY OF 7/12 AND 8A AS A PROOF OF AGRICULTURAL LAND OWNED BY HIM. THE APPELLANT HAS ALSO FURNISHED THE TALATI MANTRI CERTIFICATE TO SHOW THAT AGRICULTURAL ACTIVITIES WERE CARRIED OUT AND THE CROPS WERE PRODUCED ON THE LANDS. THE APPELLANT HAS ALSO FURNISHED THE COPY OF TALATI CERTIFICATE IN THE CASE OF HIS BROTHER SHRI ANIL AMIN AND COPY OF HIS PASSPORT AND AFFIDAVIT OF SHRI ANIL AMIN. AS PER THE APPELLANT, HIS BROTHER I.E. SHRI ANIL AMIN WAS OUT OF THE COUNTRY FROM 2007 AND SHRI ANIL AMIN HAD REQUESTED HIM TO LOOK AFTER HIS AGRICULTURAL LAND AND TO UNDERTAKE AGRICULTURAL ACTIVITIES ON HIS LAND. AS PER THE APPELLANT, SHRI ANIL AMIN HAD ALSO REQUESTED HIM TO RETAIN THE AGRICULTURAL INCOME PRODUCED FROM AGRICULTURAL LAND OWN BY SHRI ANIL AMIN. AS PER THE APPELLANT, THE AGRICULTURAL INCOME HAS BEEN SHOWN BY HIM SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 5 OF 18 IN EARLIER ASSESSMENT YEARS AND ALSO WHICH HAS BEEN DULY ACCEPTED BY THE DEPARTMENT. THE APPELLANT HAD ALSO PLEADED THAT HE HAS FURNISHED THE COPY OF RETURN OF INCOME TO SUPPORT THE AGRICULTURAL INCOME. THE APPELLANT HAS ALSO PLEADED THAT THE AO HAD NOT GIVEN THE OPPORTUNITY TO CROSS EXAMINE THE PARTIES NAMELY M/S.JAY MAHAKALI TRADERS AND M/S.SUNDERLAL RAMKISHAN KIRI. THEREFORE, THE TRANSACTION CANNOT BE REGARDED TO BE BOGUS ON THE BASIS OF ENQUIRY CONDUCTED AT HIS BACK. HOWEVER, THIS CONTENTION OF THE ASSESSEE WAS NOT ACCEPTED BY THE LD.CIT(A) ON THE GROUND THAT THE ASSESSEE HAS DEMANDED FOR CROSS EXAMINATION NOR FILED ANY CONFIRMATION BEFORE HIM. HOWEVER, THE LD.CIT(A) OBSERVED THAT IT IS UNDISPUTED FACT THAT THE APPELLANT WAS HOLDING APPROXIMATELY 27 VIGHAS OF AGRICULTURAL LAND WHICH IS EVIDENCED BY THE COPY OF 7/12 AND 8A AND ALSO FROM THE CERTIFICATE OF TALATI MANTRI. THE LD.CIT(A) FURTHER OBSERVED THAT THE PERUSAL OF THE REMAND REPORT DATED 04.06.2015 SHOWS THAT THE ASSESSEE HAS CARRIED ON SOME AGRICULTURAL ACTIVITIES ON THE AGRICULTURAL OWNED BY HIM. THERE WAS ALSO AGRICULTURAL LAND OF SHRI ANIL AMIN WHO IS THE BROTHER OF THE APPELLANT AND THE APPELLANT WAS ALLOWED BY THE BROTHER TO CARRY OUT AGRICULTURAL ACTIVITIES ON SUCH LAND. THE LD.CIT(A) HAS DISCUSSED THE VARIOUS SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 6 OF 18 ASPECTS OF THE REMAND REPORT AND HELD THAT THE CERTIFICATE FROM TALATI MANTRI REJECTED BY THE AO ON THE GROUND THAT SAME WAS NOT ISSUED BY MAMLATDAR IS NOT CORRECT. MOREOVER, THE AO WAS NEVER PREVENTED TO CALLED FOR THE INFORMATION FROM THE MAMLATDAR. HOWEVER, AFTER DETAILED DISCUSSION, THE LD.CIT(A) OBSERVED THAT THE ENTIRE AGRICULTURAL INCOME OF RS.5,59,730/- HAS CLAIMED BY THE APPELLANT CANNOT BE OUT RIGHTLY REJECTED. THOUGH THE SALE BILLS IN RESPECT OF AGRICULTURAL PRODUCE WERE FOUND TO BE FALSE, BUT AT THE SAME TIME IT CANNOT ALSO BE SAID THAT THE APPELLANT WAS NOT OWNING THE AGRICULTURAL LAND AND ALSO THERE WAS AGRICULTURAL LAND OF HIS BROTHER AND SOME OF THE ACTIVITIES WAS CARRIED OUT ON SUCH AGRICULTURAL LAND. IN VIEW OF THIS, AN AMOUNT OF RS.2 LAKHS OUT OF TOTAL INCOME OF RS.5,59,730/- WAS HELD TO BE AGRICULTURAL INCOME ON ACCOUNT OF AGRICULTURAL ACTIVITIES CARRIED OUT BY THE APPELLANT ON AGRICULTURAL LAND AND BALANCE AMOUNTING RS.3,59,730/- WAS HELD TO BE UNEXPLAINED INCOME WHICH IS LIABLE TO BE TAXED IN THE HANDS OF THE APPELLANT. 7. BEING AGGRIEVED, THE ASSESSEE FILED THIS APPEAL BEFORE THIS TRIBUNAL. SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 7 OF 18 8. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS SHOWN THE NET AGRICULTURAL INCOME ONLY FOR RATE PURPOSE IN THE RETURN OF INCOME AS INCOME. THIS AGRICULTURAL INCOME HAD NOT BEEN SHOWN / CONSIDERED AS CASH DEPOSIT IN THE BOOKS OF ACCOUNTS. THE ASSESSEE APPROXIMATELY OWNS 27 VIGHAS OF AGRICULTURAL LAND AND SUBMITTED THAT AGRICULTURAL INCOME FROM CARRYING OF AGRICULTURAL ACTIVITY ON THIS LAND RANGES BETWEEN 12 TO 15 LAKHS PER ANNUM. THE DETAILS OF LAND OWNED BY THE ASSESSEE WERE FILED AS PER PAPER BOOK, PLACED AT PAGE NO.107. FURTHER, THE LD.CIT(A) HAS ALSO ACCEPTED THIS FACT IN PARA 14.1 OF HIS APPELLATE ORDER THAT IT IS UNDISPUTED FACT IS THAT THE APPELLANT WAS HOLDING APPROXIMATELY 27 VIGHAS OF AGRICULTURAL LAND FOR WHICH HE HAS FURNISHED THE COPY OF 7/12, 8A AND ALSO CERTIFICATE FROM TALATI. FURTHER, THE ASSESSEE WAS ALSO CARRIED OUT AGRICULTURAL OPERATION ON AGRICULTURAL LAND APPROXIMATELY 67 VIGHAS OF BELONGING TO HIS BROTHER SHRI ANIL AMIN, WHO HAS ALLOWED THE ASSESSEE TO CARRIED OUT THE AGRICULTURAL ACTIVITIES ON SUCH LAND AS HE WAS BEING NRI AND HE WAS RESIDING OUT OF INDIA FROM 2007. THE DETAILS OF THE LAND HOLDING HAS BEEN FURNISHED BY THE ASSESSEE WHICH ARE PLACED AT PAPER BOOK PAGE 116. A COPY OF AFFIDAVIT OF SHRI ANIL AMIN IS ALSO FILED IN SUPPORT OF HIS CONTENTION OF SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 8 OF 18 THE ASSESSEE AND ALSO ALLOWED TO RETAIN AND KEEP THE AGRICULTURAL INCOME WITH THE ASSESSEE. THE ASSESSEE HAS ALSO FILED A COPY OF PASSPORT IN SUPPORT OF HIS CLAIM THAT HIS BROTHER WAS SHRI ANIL AMIN WAS RESIDING OUTSIDE INDIA. THESE DETAILS WERE ALSO FILED BEFORE THE LD.CIT(A) DURING THE COURSE OF APPELLATE PROCEEDINGS ON WHICH REMAND REPORT WHICH WAS DULY CALLED FOR. THE LD.COUNSEL FURTHER SUBMITTED THAT RELEVANT DETAILS OF AGRICULTURAL INCOME EARNED BY THE ASSESSEE OUT OF THE ACTIVITIES CARRIED OUT ON HIS LAND AS WELL AS THE LAND OWNED BY HIS BROTHER WE SUBMIT BEFORE THE AO BUT THE AO IGNORED THE SUBMISSION MADE BY THE ASSESSEE AND RELIED UPON MERELY ON THE STATEMENT RECORDED BY THE INSPECTOR OF THE PARTIES TO WHOM AGRICULTURAL PRODUCE WAS SOLD BY THE ASSESSEE AND BUT SUBSEQUENTLY DENIED PURCHASING AGRICULTURAL PRODUCE FROM THE APPELLANT. THE LD.CIT(A) HAS OBTAINED 3 REMAND REPORTS DATED 22.03.2015, 15.05.2015 AND 04.06.2015 AND THE ASSESSEE HAS REBUTTED THE REMARKS AND OBSERVATIONS MADE BY THE AO IN HIS REMAND REPORT WHICH HAS BEEN DULY REPRODUCED BY THE LD.CIT(A) IN HIS APPELLATE ORDER. THEREFORE, THE LD.CIT(A) WAS NOT JUSTIFIED IN ACCEPTING RS.2 LAKHS AS AGRICULTURAL INCOME AS AGAINST RS.5.59 LAKHS SHOWN BY THE ASSESSEE. THEREFORE, LD.CIT(A) ASSUMPTION THAT SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 9 OF 18 AGRICULTURAL INCOME FROM APPROXIMATELY 94 VIGHAS (27 TO 67) OF LAND IS ONLY RS.2 LAKHS IS VAGUE AND UNREAL. HOWEVER, THE LD.CIT(A) HAS CATEGORICALLY ACCEPTING THE APPELLANTS CONTENTION OF EARNING AGRICULTURAL INCOME ON THE BASIS OF DOCUMENTS PROOF PLACED ON RECORD BY HIM. FURTHER, THE AO INITIALLY MADE ADDITION ON ACCOUNT OF ALLEGED BOGUS AGRICULTURAL INCOME BASED ON THE STATEMENT OF M/S.JAY MAHAKALI TRADERS AND M/S.SUNDERLAL RAMKISHAN KIRI BUT FAILED TO CONSIDER THE OVERALL SURROUNDING CIRCUMSTANCES, HENCE STATEMENT RELIED AGAINST THE ASSESSEE IS AGAINST THE NATURAL JUSTICE. THE LD.CIT(A) HAS NOT ALLOWED THE CROSS EXAMINATION OF THE PARTIES CONCERNED THE COUNSEL FURTHER PLACED RELIANCE IN THE CASE OF ITO VS. KIRITSINH VAKHATSINH GOHIL(HUF) IN [ITA NO.1340/AHD/2009] AND WHEREIN THE REVENUE HAS ACCEPTED THE AGRICULTURAL LAND HOLDING OF THE ASSESSEE AND ASSESSEE HAS SHOWN THE AGRICULTURAL INCOME IN EARLIER YEARS. THE TRIBUNAL HAS HELD THAT THE ENQUIRY CONDUCTED REGARDING BOGUS TRANSACTION BASIS AT THE BACK OF THE ASSESSEE CANNOT BE ACCEPTED, THEREFORE THE ADDITION MADE U/S.68 WAS DELETED. FURTHER, THE DEPARTMENT HAS NOT PREFERRED ANY SECOND APPEAL AGAINST THE RELIEF OF RS.2 LAKHS GRANTED BY THE LD.CIT(A) SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 10 OF 18 WHICH IMPLIES THAT THE AO HAS ACCEPTED THE CONTENTION OF ASSESSEES HOLDING OF AGRICULTURAL LAND OF EARNING AGRICULTURAL INCOME THEREFROM. 9. PER CONTRA, THE LD.SENIOR DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDER OF THE LD.CIT(A) AND CONTENDED THAT THE BILLS PRODUCED BY THE ASSESSEE WERE NOT SUBSTANTIATED AND THE PURCHASER PARTY HAVE DENIED TO HAVE DONE ANY TRANSACTION WITH THE ASSESSEE AND THE ASSESSEE HAS NOT MADE ANY CLAIM BEFORE THE AO THAT LAND BELONGED TO HIS BROTHER WAS ALSO UTILISED BY HIM. THEREFORE, THE LD.CIT(A) HAS JUSTIFIED IN HIS ACTION. 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE LD.CIT(A) HAS CATEGORICALLY ADMITTED IN PARA 14.1 OF THE APPELLATE ORDER THAT IT IS UNDISPUTED FACT THAT THE ASSESSEE WAS HOLDING APPROXIMATELY 27 VIGHAS OF AGRICULTURAL LAND WHICH IS SUPPORTED OF BY COPY OF 7/12 AND 8A CERTIFICATE AND ALSO FROM THE CERTIFICATE TALATI. IT IS ALSO OBSERVED BY LD.CIT(A) FROM THE REMAND REPORT DATED 04.06.2015 THAT AGRICULTURAL ACTIVITIES WERE BEING CARRIED OUT BY THE ASSESSEE ON THE AGRICULTURAL LAND OWNED BY HIM. FURTHER, THERE WAS ALSO AGRICULTURAL LAND OF SHRI ANIL AMIN WHO IS THE BROTHER OF THE APPELLANT WHO WAS SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 11 OF 18 HOLDING 67 VIGHAS OF AGRICULTURAL LAND WHICH WERE GIVEN TO THE ASSESSEE FOR CARRYING OUT AGRICULTURAL ACTIVITIES AND FOR KEEPING THE AGRICULTURAL INCOME WITH HIM. IN SUPPORT OF THIS, THE ASSESSEE HAS FILED AN AFFIDAVIT FROM SHRI ANIL AMIN AS WELL AS COPY OF PASSPORT INDICATING THAT SHRI ANIL AMIN WAS RESIDING OUT OF INDIA FROM 2007. THEREFORE, THE ASSESSEE WAS EARNING AGRICULTURAL INCOME FROM HIS BROTHERS AGRICULTURAL LAND ALSO. WE, FURTHER NOTE THAT THE LD.CIT(A) HAS OBSERVED FROM THE REMAND REPORT OF THE AO THAT THERE IS SOME DIFFERENCE OF AGRICULTURAL CROP GROWN ON THE LAND AS PER REPORTS OF THE TALATI. HOWEVER, IT IS NOTICED THAT THE LD.CIT(A) HAS OBSERVED THAT MERELY BECAUSE NO INFORMATION WAS AVAILABLE REGARDING CROPS UNDERTAKING IN 7/12 OR DIFFERENCE IN CROP 7/12 AND IN TALATI CERTIFICATE (I.E. ONLY ONE CERTIFICATE OUT OF 3 CERTIFICATES) DOES NOT MEAN THAT NO AGRICULTURAL ACTIVITY WAS UNDERTAKEN ON THE LAND. THEREFORE, THE SUBMISSION OF THE ASSESSEE WERE FOUND TO BE ENABLE. WE FURTHER NOTE THAT THE ASSESSEE HAS SHOWN AGRICULTURAL INCOME IN EARLIER YEARS WHICH HAS BEEN DULY ACCEPTED BY THE DEPARTMENT. THEREFORE, CONSIDERING THE FACT THAT THE ASSESSEE WAS CARRIED AGRICULTURAL OPERATIONS OF APPROXIMATELY 94 VIGHAS (27 VIGHAS BELONG TO ASSESSEE AND 67 VIGHAS BELONGING TO HIS BROTHER) ON WHICH HE SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 12 OF 18 HAD GROWN VARIOUS CROPS LIKE COTTON AND SUGAR CANE. THESE CROPS WERE DULY SOLD OFF THE MARKET AT A GOOD PRICE. FURTHER, THE ASSESSEE HAS CLAIMED GROSS AGRICULTURAL INCOME AT RS.9.44 LAKHS AND FILED DETAILS OF AGRICULTURAL PRODUCE AT 16.95 LAKHS. THEREFORE, CONSIDERING 1/3 RD OF THE NET AGRICULTURAL INCOME THE AGRICULTURAL INCOME SHOWN AT RS.5.59 LAKHS IS APPEARS TO BE REASONABLE. FURTHER, THE CO-ORDINATE BENCH OF AHMEDABAD TRIBUNAL IN THE CASE OF ITO VS. KIRTSINH VAKHATSINH GOHIL (HUF) IN [ITA NO.1340/AHD/2009] HAS HELD THAT THE ASSESSEE IS HOLDING AGRICULTURAL LAND TO THE TUNE OF 18.19 ACRES WHICH IS NOT DENIED BY THE REVENUE. THE AO HAS TREATED SALE OF COTTON CROPS BEFORE BOGUS ON THE BASIS OF STATEMENT OF PARTNER OF THE B.J.FACTORY. HOWEVER, THE PARTNER WAS NOT ALLOWED TO CROSS-EXAMINATION. THEREFORE, IT WAS HELD THAT TRANSACTION CANNOT BE REGARDED TO BE BOGUS ON THE BASIS OF THE ENQUIRY CONDUCTED AT THE BACK OF THE ASSESSEE. THE FACTS OF THE ASSESSEE CASE ARE SIMILAR TO AFORE SAID CASE AS THE ASSESSEE IS ALSO HOLDING 94 VIGHAS AGRICULTURAL LAND AND DOING AGRICULTURAL ACTIVITY THEREON, WHICH HAS BEEN ACCEPTED BY THE DEPARTMENT. FURTHER, THE ASSESSEE HAS SHOWN THE AGRICULTURAL INCOME IN EARLIER YEARS WHICH HAS NOT BEEN DISPUTED. THEREFORE, MERELY BECAUSE THE SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 13 OF 18 STATEMENT OF A SAME PURCHASER WHO WAS EXAMINED AT THE BACK OF THE ASSESSEE, THEREFORE, THE TRANSACTION CANNOT BE REGARDED AS BOGUS. IN VIEW OF ABOVE FACTS AND CONSIDERING THE TOTALITY OF THE FACTS WE ARE OF THE CONSIDERED OPINION THAT THE LD.CIT(A), WAS NOT JUSTIFIED IN ACCEPTING PART OF RS.2 LAKHS AS AGRICULTURAL INCOME AND BALANCE OF RS.3,59,730/- AS NON-AGRICULTURAL INCOME. THEREFORE, THE ADDITION OF RS.3,59,730/- SUSTAINED BY THE LD.CIT(A) IS THEREFORE DIRECTED TO BE DELETED, ACCORDINGLY THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 11. GROUND NO.2 STATES THAT LD.CIT(A) HAS ERRED IN IGNORING THE OPENING CASH ON HAND AND ADDITION OF UNEXPLAINED CASH CREDIT. 12. BRIEF FACTS OF THE CASE ARE THAT THE AO NOTICED THAT THERE WAS CASH DEPOSIT OF RS.15,72,000/- ON VARIOUS DATES IN THE BANK ACCOUNT OF THE ASSESSEE. IT WAS EXPLAINED BY LETTER DATED 22.03.2013 THAT THE ASSESSEE HAS DEPOSITED THE CASH AMOUNT IN BANK ACCOUNT OUT OF SALE PROCEEDS TO AGRICULTURAL PRODUCES. IT WAS FURTHER SUBMITTED THAT WHEN AT A RELEVANT TIME, AS AND WHEN NEEDED OR NEEDS ARISE FOR PURCHASE OF INTENDED AGRICULTURAL LAND THE FUNDS WERE WITHDRAWN FROM BANK AND WHEN DEED DID NOT MATERIALIZE FOR WHICH CASH AMOUNT SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 14 OF 18 WAS WITHDRAWN FROM BANK WERE AGAIN DEPOSITED BY HIM IN THE BANK ACCOUNT OVER THE PERIOD AND THE SAME WERE IN RESPECT OF SALE OF AGRICULTURAL PRODUCES AND IN RESPECT OF CASH WITHDRAWN FROM HE SAID BANK ACCOUNT ONLY. IT WAS FURTHER SUBMITTED THAT THE ASSESSEE HAD NO OTHER SOURCE EXCEPT IN RESPECT OF AGRICULTURAL ACTIVITY CARRIED OUT BY HIM AND PARTNER IN FIRM. HOWEVER, THE AO DID NOT FOUND THE REPLY TO BE SATISFACTORY, HENCE TREATED THE CASH DEPOSIT OF RS.15,72,000/- AS UNEXPLAINED INCOME. 13. THE ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A). HOWEVER, THE LD.CIT(A) OBSERVED THAT THE ASSESSEE HAS FAILED TO FURNISH EVIDENCE TO SHOW THAT DEPOSITS IN THE BANK ACCOUNT WERE OUT OF AGRICULTURAL INCOME, HOWEVER THERE WAS WITHDRAWAL AND DEPOSIT OF CASH AMOUNTS IN THE BANK ACCOUNT OF THE APPELLANT AT CERTAIN INTERVALS. IN OTHER WORDS, THERE HAS BEEN DEPOSITS AND WITHDRAWALS AND FURTHER DEPOSITS AND AGAIN WITHDRAWALS IN THE CASE OF THE APPELLANT AND THEREFORE, CONCEPT OF PEAK THEORY CAN BE APPLIED IN HIS CASE. SINCE THE LD.CIT(A) HAS UPHELD THE ADDITION OF RS.3,59,730/- ON AGRICULTURAL INCOME, HENCE IT WAS HELD THAT WHILE APPLYING THE PEAK THEORY IN THE CASE OF THE ASSESSEE THIS AMOUNT OF RS.3,59,730/- CONSIDERED AS UNACCOUNTED CASH AVAILABLE IN HIS SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 15 OF 18 HANDS. THEREFORE, THE AO WAS DIRECTED TO APPLY THE PEAK THEORY IN THE CASE OF THE APPELLANT IN RESPECT OF DEPOSITS AND WITHDRAWALS OF CASH AMOUNT IN THE BANK AND AVAILABILITY OF UNACCOUNTED CASH OF RS.3,59,730/- IN HIS HAND AND IF ANY EXCESS CASH IS FOUND TO BE DEPOSITED IN SUCH BANK ACCOUNT THEN THE SAME BE TREATED AS UNEXPLAINED CASH INCOME OF THE APPELLANT. 14. BEING AGGRIEVED, THE ASSESSEE FILED THIS APPEAL BEFORE THIS TRIBUNAL. THE LD.COUNSEL SUBMITTED THAT THE LD.CIT(A) HAS CONSIDERED THE UNEXPLAINED CASH OF RS.3,59,730/- AVAILABLE AS CASH IN THE HAND OF THE ASSESSEE FOR WORKING OF PEAK THEORY IN RESPECT OF CASH DEPOSIT IN THE BANK ACCOUNT. HOWEVER, THE SAID AGRICULTURAL INCOME IS NOT UNEXPLAINED AS CLAIMED IN THE GROUND NO.1 ABOVE, THEREFORE THE SAME IS VERY MUCH AVAILABLE FOR EXPLAINING CASH DEPOSITS AND PEAK THEORY OF BANK DEPOSITS IN THE BANK ACCOUNT. IT WAS FURTHER CONTENDED THAT THE LD.CIT(A) HAS FAILED TO CONSIDER HIS OPENING CASH BALANCE AS PER CASH BOOK SUBMITTED BY THE ASSESSEE WHICH IS PLACED AT PAPER BOOK, PAGE 196. IT WAS SUBMITTED THAT THE ASSESSEE WAS HAVING OPENING CASH ON HAND AND CASH BALANCE AS PER CASH BOOK AS ON 01.04.2009 AT RS.11,58,000/-. THE DETAILS OF WHICH ARE PLACED AT PAPER BOOK, PAGE 201. HOWEVER, THE LD.CIT(A) SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 16 OF 18 ACCEPTED THE CONTENTION OF THE ASSESSEE THAT CASH BALANCE DEPOSITED IN THE BANK ACCOUNT OUT OF CASH WITHDRAWALS MADE FROM THE BANK ACCOUNT, BUT DID NOT CONSIDER THE OPENING CASH ON HAND OF RS.11,58,000/- FOR SET OFF OF PEAK CREDIT CALCULATION PURPOSE. THE LD.CIT(A) HAS IGNORED THE SUBMISSION OF THE ASSESSEE AND NOT GIVEN ANY SPECIFIC DIRECTION TO AO TO CONSIDER THE OPENING CASH ON HAND OF RS.11,58,000/- WHILE GIVING FINAL DIRECTION IN HIS ORDER. THEREFORE, IT WAS SUBMITTED THAT CASH DEPOSIT INTO THE BANK ACCOUNT WERE ON ACCOUNT OF WITHDRAWALS MADE FROM THE BANK ACCOUNT WAS ACCEPTED BY THE AO DURING THE VERIFICATION OF ADDITIONAL EVIDENCES, BUT THE AO HAS NOT MADE ANY ADVERSE REMARKS IN THE REMAND REPORT AGAINST THE CASH OF BANK BOOK SUBMITTED ALONG WITH ADDITIONAL EVIDENCES AS COULD BE SEEN FROM THE COPY OF REMAND REPORT PLACED AT PAPER BOOK 150 TO 178. THEREFORE, IT WAS DIRECTED THAT IF THE AO HAS CONSIDERED OPENING CASH ON HAND AS ON 01.04.2009 AS ZERO THEN THE CASH DEPOSITS OF RS.50,000/-, RS.1 LAKH, RS.1.90 LAKHS AMOUNTING TO RS.3.40 LAKHS AS ON 23.04.2014 AND HAVE BEEN CONSIDERED AS UNEXPLAINED CASH DEPOSITS BECAUSE OF NON-CONSIDERATION OF OPENING CASH ON HAND OF RS.11,58,000/-. IT WAS FURTHER SUBMITTED THAT THE CLOSING CASH ON HAND AS ON 31.03.2009 OF RS.11,58,000/- THIS SHOULD SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 17 OF 18 HAVE BEEN CONSIDERED AS THE OPENING CASH ON HAND AS ON 01.04.2009 WHILE DETERMINING THE PEAK CASH IN THE PERIOD OF 01.04.2009 TO 31.03.2010. 15. ON THE OTHER HAND, THE LD.SENIOR DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDER OF THE LD.CIT(A). 16. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. AS WE HAVE ALSO HELD IN GROUND NO.1 ABOVE WITH AGRICULTURAL INCOME OF RS.3,59,730/- IS NOT FROM UNACCOUNTED SOURCE, THEREFORE THIS AMOUNT IS AVAILABLE FOR WORKING OUT PEAK CREDIT IN RESPECT OF BANK DEPOSITS. WE FURTHER NOTE THAT THE ASSESSEE HAS CLAIMED OPENING CASH BALANCE AT RS.11,58,000/- AS ON 01.04.2009 AS APPEARING AT PAGE NO.196 TO 201 ON WHICH THE AO HAS NOT MADE ANY ADVERSE REMARKS IN HIS REMAND REPORT. THEREFORE, THIS OPENING CASH BALANCE WAS AVAILABLE FOR WORKING OUT PEAK CREDIT IN RESPECT OF BANK DEPOSITS. HOWEVER, WE FIND THAT THE LD.CIT(A) HAS NOT GIVEN ANY DIRECTION WITH REGARD TO CONSIDERING THESE OPENING CASH IN HAND OF RS.11,58,000/-. SINCE THE OPENING CASH BALANCE OF RS.11,58,000/- IS SUPPORTED BY THE CASH BOOK WHICH WERE FILED BEFORE LD.CIT(A) AS ADDITIONAL EVIDENCE, THEREFORE, WE ARE OF THE SHRI JAYESHBHAI J AMIN VS. ITO, WARD-4, BHARUCH /ITA NO.1040/AHD/2016 : A.Y.2010-11 PAGE 18 OF 18 CONSIDERED OPINION THAT WHILE WORKING OUT THE PEAK THEORY OF CASH DEPOSITS THIS OPENING CASH BALANCE OF RS.11,58,000/- AND AGRICULTURAL INCOME OF RS.3,59,730/- ARE REQUIRED TO BE CONSIDERED FOR WORKING OUT OF PEAK AND THEREAFTER ONLY IF ANY EXCESS CASH AMOUNT IS FOUND TO BE DEPOSITED SUCH MAY BE TREATED AS UNEXPLAINED CASH INCOME OF THE ASSESSEE IF ANY, ACCORDINGLY, THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 17. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. 18. THE ORDER PRONOUNCED IN THE OPEN COURT ON 23.07.2019. SD/- SD/- (BHAVNESH SAINI) (O.P.MEENA) ( /JUDICIAL MEMBER) ( /ACCOUNTANT MEMBER) / SURAT, DATED : 23 RD JULY , 2019/ S.GANGADHARA RAO, SR.PS COPY OF ORDER SENT TO- ASSESSEE/AO/PR. CIT/ CIT (A)/ ITAT (DR)/GUARD FILE OF ITAT. BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, SURAT