Shri Sandeep Sugandhilal Bora, Ahmednagar V. ITO, Ward-4, Ahmednagar

ITA 1101/PUN/2013

• Counselvise Citation: 110124514 RSA 2013
• Duration Of Justice: 1 year(s) 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2004-2005
• Appeal Filed On: 17-05-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Unexplained investment; Presumptive income; Business income
• Section: 143(3); 131; 68; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NOS.1096 & 1097/PN/2013 (A.YS: 1999-2000 & 2004-05) SHRI SUHAS SUGANDILAL BORA A/P MIRAJGOAN, TALUKA KARJAT, DIST AHMEDNAGAR PAN: AHYPB5398M APPELLANT VS. ITO, WARD-4, AHMEDNAGAR RESPONDENT ITA NOS.1098 & 1099/PN/2013 (A.YS: 1999-2000 & 2004-05) SHRI SARANG SUGANDILAL BORA A/P MIRAJGOAN, TALUKA KARJAT, DIST AHMEDNAGAR PAN: AGRPB1593J APPELLANT VS. ITO, WARD-4, AHMEDNAGAR RESPONDENT ITA NOS.1100 & 1101/PN/2013 (A.YS: 1999-2000 & 2004-05) SHRI SANDEEP SUGANDILAL BORA A/P MIRAJGOAN, TALUKA KARJAT, DIST AHMEDNAGAR PAN: ABQPB4652C APPELLANT VS. ITO, WARD-4, AHMEDNAGAR RESPONDENT ASSESSEE BY : SHRI KISHORE PHADKE DEPARTMENT BY : SHRI RAJE SH DAMOR DATE OF HEARING: 04.09.2014 DATE OF ORDER : 24.09.2014 ORDER 2 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP PER SHAILENDRA KUMAR YADAV, J.M: ALL THESE APPEALS FILED BY THE ASSESSEE PERTAIN TO ONE GROUP AGAINST THE RESPECTIVE ORDERS OF COMMISSIONER OF IN COME TAX (APPEAL)-I, PUNE FOR A.YS.1999-2000 & 2004-05. SO, FOR THE SAKE OF CONVENIENCE, THEY ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER. 2. IN ITA NO.1096/PN/2013 FOR A.Y. 1999-2000, THE A SSESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT(A)-I PUNE ERRED IN LAW AND ON FACTS IN CONFIRMING THE PART OF THE ADDITION MADE BY ACIT, W ARD 4, AHMEDNAGAR AMOUNTING TO RS. 2,58,400- (I.E. RS. 7,5 8,400- RS.5,00,000) PERTAINING TO OPENING CAPITAL BALANCE ON 1-04- 1998. 2. THE CIT(A)-I , PUNE ERRED IN LAW AND ON FACTS IN NO T APPRECIATING FACT THAT THE ASSESSEE IS BENEFICIAL O WNER & CULTIVATOR OF HUF AGRICULTURAL LAND SITUATED AT HANUMANTGAON AND HENCE, QUANTIFICATION OF AGRICULTU RAL INCOME OUGHT TO HAVE BEEN MADE ON TOTAL LAND HOLDIN G OF 104 ACRES INSTEAD OF 44 ACRES. 3. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN EST IMATING AGRICULTURAL INCOME RS.10,000 PER ACRE. THE LEARNE D CIT(A)- I, PUNE OUGHT TO HAVE APPRECIATED THAT YEARLY INCOM E OF RS. 10,000 PER ACRE ARE VERY LOW AND DISPROPORTIONATE T O REALISTIC LEVEL. 4. THE CIT(A)-I , PUNE ERRED IN LAW AND ON FACTS IN NO T GIVING PROPORTIONATE TELESCOPING OF SHARE OF AGRICULTURAL INCOME OF ASSESSEE'S FATHER SUGHANDHILAL BORA AMOUNTING TORS.5,00,000/-. 5. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN TELESCOPING ESTIMATED AGRICULTURAL INCOME OF RS.7,0 0,000 PERTAINING TO YEARS 1999-00 TO 2004-05 WITH AGRICUL TURAL INCOME PRIOR TO 01/04/1998. 6. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN CON FIRMING THE ADDITION WITH RESPECT TO LOAN FROM ASSESSEE'S F ATHER SUGANDHILAL BORA AMOUNTING TO RS.4,50,000/- WITHOUT ADJUDICATING THE MATTER ON MERITS. 3 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 7. THE APPELLANT CRAVES LEAVE TO ADD / MODIFY / ALTER / DELETE ALL / ANY OF THE GROUNDS OF APPEAL. 2.1 THE ASSESSEE IS AN INDIVIDUAL AND IS ENGAGED IN THE BUSINESS OF RETAIL TRADING OF MACHINERY, ELECTRIC M OTORS AND AGRICULTURAL EQUIPMENTS. A SURVEY WAS CONDUCTED IN THE ASSESSEE'S PREMISES ON 2.12.2003 WHEREIN IT WAS FOU ND THAT THE TOTAL INVESTMENT BY ALL THE FAMILY MEMBERS VIZ. SHR I SARANG SUGANDHILAL BORA, SHRI SUHAS SUGANDHILAL BORA, AND SHRI SANDEEP SUGANDHILAL BORA ALONG WITH THEIR WIVES WAS RS.99,30,220 ON ACCOUNT OF THE FOLLOWING INVESTMENT S : 2.2 DURING THE COURSE OF SURVEY, THE SOURCES TO THE EXTENT OF RS.45,00,000/- WERE EXPLAINED BY SHRI SARANG SUGAND HILAL BORA, THE ASSESSEE'S BROTHER, IN A STATEMENT RECORDED U/S 131 OF THE ACT, WHICH IS AS UNDER: A) INCOME DECLARED IN LAST 6 YEARS BY ALL FAMILY MEMBE RS IS RS.18 LAKHS B) SAVINGS BY ALL FAMILY MEMBERS IN LAST 6 YEARS IS RS .20 LAKHS C) APPROXIMATE AMOUNT DERIVED FROM HUF AGRICULTURAL INCOME IS RS.7 LAKHS (TOTAL INCOME RS.45 LAKHS) 2.3 THE BALANCE AMOUNT OF RS.54,30,220/- (RS.99,30, 220/- - RS.45,00,000) WAS DECLARED AS ADDITIONAL INCOME FOR THE A.YS. I. FLAT AT KOHINOOR GARDEN, AHMEDNAGAR 6,00,000 II. BURUDGAON PLOT, AHMEDNAGAR (FROM CHALLANI) 11,30,670 III. SHOP PREMISES OF MIRAJGAON 15,000 IV. SARADA JIN PLOT, AHMEDNAGAR(FROM RAHUL PITALE) 26,33,050 V. ON MONEY FOR ABOVE PLOT 10,51,500 VI. EXCESS STOCK 40,00,000 VII. CONSTRUCTION EXPENSES OF MIRAJGAON SHOP 5,00,000 TOTAL 99,30,220 4 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 2003-04 AND 2004-05 INITIALLY IN THE HANDS OF SARAN G SUGANDHILAL BORA AND THEREAFTER IN THE HANDS OF ALL 6 FAMILY MEMBERS BY WAY OF AN AFFIDAVIT FILED BEFORE THE ASS ESSING OFFICER. THE DECLARATION IN THE HANDS OF THE VARIOUS FAMILY MEMBERS WHICH COVERED THE DECLARATION OF ADDITIONAL INCOME OF RS.54,30,220/- MADE DURING SURVEY, WAS MADE FOR A.Y .S 2003-04 AND 2004-05, AS UNDER: NAME OF THE PERSON STOCK A.Y. 04-05 CONSTRUCTION EXPENSES A.Y. 04-05 EXPENSES A.Y. 04-05 OTHER CAPITAL EXPENSES A.Y. 03-04 TOTAL MR. SARANG BORA 13,47,276 -- 1,66,667 1,83,833 16,97,776 MR. SANDEEP BORA 14,40,722 -- 1,66,667 1,83,834 17,91,222 MR.SUHAS BORA 4,94,575 5,00,000 1,66,667 1,83,833 13,45,075 MRS. MEENA SARANG BORA 2,55,596 2,55,596 MRS.MADHURI SUHAS BORA 2,55,188 2,55,188 MRS. KIRTEE SANDEEP BORA 2,54,782 2,54,782 TOTAL 40,48,139 5,00,000 5,00,000 5,51,500 55,99,639 2.4 PRIOR TO THE SURVEY, THE ASSESSEE HAD FILED A S INGLE RETURN OF INCOME FOR THE A.Y. 2003-04 DECLARING INCOME OF RS. 1,38,550/-. THIS RETURN OF INCOME WAS NOT SUPPORTED BY EITHER S TATEMENT OF AFFAIRS OR BALANCE SHEET. THE ASSESSING OFFICER NO TICED THAT IN THE RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YEAR 1 999-2000, FILED BELATEDLY AFTER THE SURVEY ON 24.12.2003, THE ASSESSEE HAD DECLARED TOTAL INCOME AT RS.63,400/-. DURING THE C OURSE OF ASSESSMENT PROCEEDINGS (SUBSEQUENT TO THE SURVEY) F OR THE A.Y. 2003-04, THE ASSESSEE FILED STATEMENT OF AFFAIRS FR OM 31.03.1999 TO 31.03.2004 AND CLAIMED OPENING CAPITAL BALANCE O F RS.7,58,000/- AS ON 31.03.1999. THIS INCOME BY WAY OF OPENING CAPITAL BALANCE WAS TREATED AS INCOME ESCAPING ASSE SSMENT AND NOTICE U/S.148 OF THE ACT WAS ISSUED FOR THE IMPUGN ED A.Y. 1999- 2000. DURING THE SCRUTINY PROCEEDINGS, THE EXPLANA TION 5 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP FURNISHED ON BEHALF OF THE ASSESSEE THAT THE SOURCE S FOR THE OPENING CAPITAL BALANCE WERE OUT OF SAVINGS OF HUF AGRICULTURAL INCOME WAS REJECTED BY THE ASSESSING OFFICER WHO, I NTER ALIA, OBSERVED WHILE ADDING THE OPENING CAPITAL BALANCE T O THE TOTAL INCOME OF THE ASSESSEE THAT: I) NO COPARCENER OF THE HUF CAN CLAIM SAVINGS OUT OF HUF AGRICULTURE INCOME UNLESS THERE IS COMPLETE PARTITION IN THE HUF. UTILIZATION OF HUF FUND FOR PERSONAL SAVING OR INVESTMENT IS NOT POSSIBLE IN VI EW OF THE AMENDMENT TO SECTION 171 OF THE INCOME TAX ACT. II) NO RETURN OF INCOME SHOWING ACCRUAL OF AGRICULTURAL INCOME HAS BEEN FILED BY THE FAMILY TILL THE DATE O F ORIGINAL ASSESSMENT. MOREOVER, THE ASSESSEE FAILS T O PRODUCE ANY STATUTORY EVIDENCE ABOUT HIS BEING ENGAGED IN AGRICULTURAL ACTIVITIES AND HE WAS ALSO NOT ABLE TO STATE TO WHOM AGRICULTURAL PRODUCE HAS BEEN SOLD, IT HAS BEEN HELD THAT THE INCOME CLAIMED CANN OT BE ASSESSED UNDER THE HEAD AGRICULTURAL INCOME. 3. THE MATTER WAS CARRIED BEFORE FIRST APPELLATE AU THORITY, WHEREIN THE APPEAL WAS DISMISSED DUE TO NON-PROSECU TION BY THE ASSESSEE BUT THE ITAT PUNE CONSIDERED THE REQUEST I N THIS REGARD OF THE COUNSEL OF THE ASSESSEE AND SET ASIDE THE MA TTER TO THE ASSESSING OFFICER TO CONSIDER THE OUTCOME OF THE IS SUES RAISED IN ITA NO.294/PN/2009 FOR A.Y. 2003-04 I.E. THE ISSUE RELATING TO DECLARATION IN THE HANDS OF FEMALE FAMILY MEMBERS, IN THE ASSESSMENT TO BE DONE AFRESH. 3.1 THE ASSESSING OFFICER HAS MADE ADDITION OF RS.7 ,58,000/- CLAIMING TO BE OPENING CAPITAL BALANCE BY REJECTING THE ASSESSEES EXPLANATION REGARDING OWNERSHIP OF LARGE AGRICULTUR AL LANDS AND AGRICULTURAL ACTIVITY THEREON. THE MATTER WAS CARR IED BEFORE FIRST APPELLATE AUTHORITY, WHEREIN THE VARIOUS CONTENTION S WERE RAISED ON BEHALF OF THE ASSESSEE, WHEREIN THE CIT(A) HAS O BSERVED THAT IN RESPECT OF THESE APPEALS IN THE CASES OF THE APPELL ANTS SHRI SUHAS SUGANDHILAL BORA, SHRI SARANG SUGANDHILAL BORA AND SHRI 6 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP SANDEEP SUGANDHILAL BORA WERE IDENTICAL. THEREFORE , PROPOSED TO TREAT THE ASSESSEE'S CASE AS THE LEAD CASE AND APPL Y THE DECISION TAKEN IN THIS CASE, MUTATIS MUTANDIS TO THE OTHER A PPEALS. 3.2 IN APPELLATE PROCEEDINGS IN SECOND ROUND OF ASS ESSMENT PROCEEDINGS, THE ASSESSEE EXPLAINED THAT THE OPENIN G BALANCE IS THE RESULT OF ACCRETION OVER A NUMBER OF YEARS ARIS ING OUT OF THE AGRICULTURAL INCOME OF THE FAMILY. THE ASSESSEE PR ODUCED THE 7/12 EXTRACT IN RESPECT OF AGRICULTURAL LAND ADMEAS URING 101 ACRES SITUATED AT HANUMANT GAON, MIRAJGAON, GHUMARI , & SANGAVI IN THE NAMES OF SHRI SUGANDHILAL PANANLAL B ORA (FATHER OF THE ASSESSEE), SARANG S BORA, SUHASH S BORA, AND SANDEEP S BORA AND OTHER MEMBERS OF THE LARGER HUF, WHICH SHO WS THAT CROPS SUCH THAT JOWAR, BAJRA, TUR, WHEAT, MOONG, SU NFLOWER, SUGARCANE, POMEGRANATE, ETC. HAD BEEN CULTIVATED. CERTIFICATE OF TAHASILDAR, KARJAT & ASHTI CERTIFYING AGRICULTURAL INCOME OF RS. 40,35,000/- (IN RESPECT OF LAND AT KARJAT) & RS.40, 50,000/- (IN RESPECT OF LAND AT ASHTI) CUMULATIVELY IN THE HANDS OF FATHER & HIS THREE SONS INCLUDING THE ASSESSEE WERE FILED. THE ASSESSEE ALSO FILED STATEMENT OF CERTAIN SUGAR FACTORY AS EVIDENC E OF SUPPLY OF SUGARCANE IN THE CASE OF SUHAS BORA. HOWEVER, THE ASSESSING OFFICER DID NOT ACCEPT THE CLAIM OF OWNERSHIP IN RE SPECT OF 101 ACRES AFTER EXAMINING THE 7/12 EXTRACT. THE ASSESS ING OFFICER HELD THAT THE TOTAL LAND HOLDING BY THE THREE BROTH ERS IS ONLY AROUND 20 ACRES WHICH COULD NOT POSSIBLY SUPPORT SU CH HUGE INCOME. SO FAR AS THE LANDS AT GUT NO.403, 287, 13 , 331, 433 & 434 AT HANUMANTGAON WERE CONCERNED, THESE LANDS MEA SURING 72 ACRES WERE PRIMARILY IN THE NAME OF GRANDFATHER, SHRI PANNALAL CHUNILAL BORA, UNCLE SHRI KANTILAL BORA, H IS WIFE & THEIR CHILDREN. THE ASSESSING OFFICER ALSO HELD THAT THE SALE BILLS OF AGRICULTURAL PRODUCE WERE NEVER PRODUCED BEFORE THE AUTHORITIES EITHER DURING SCRUTINY OR APPELLATE PROCEEDINGS AND WERE 7 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP PRODUCED FOR THE FIRST TIME ON 12.12.2011 AT THE FA G END OF TIME BARRING PROCEEDINGS. 3.3 THE ASSESSING OFFICER EXAMINED THE XEROX COPY O F 234 BILLS AMOUNTING TO RS.92,07,139/- ISSUED IN THE NAME OF T HE THREE BROTHERS AND FOUND THEM TO BE APPARENTLY FABRICATED . THE DETAILS OF THE PARTIES TO WHOM THE AGRICULTURAL PRODUCE WAS APPARENTLY SOLD APPEARS AT PAGE 13 PARA (VIII) OF THE ASSESSME NT ORDER. THE ASSESSING OFFICER CALLED FOR THE ORIGINAL COPIES OF THE BILLS BUT THE SAME WERE NOT PRODUCED. SHE PROCEEDED TO ISSUE SUM MONS TO THE PARTIES BUT THE SUMMONS WERE RETURNED UNSERVED IN THE CASES OF M/S KARAM & CO. MARKET YARD, AHMEDNAGAR AN D PAWAR KADBA VIKRI KENDRA, MARKET YARD, AHMEDNAGAR. EXAMI NATION ON OATH OF SHRI VIJAYKUMAR PANNALAL KOTHARI, PARTNER O F M/S ASHOK TRADING CO., MIRAJGAON ON 15.12.2011 REVEALED THAT THE FIRM DID NOT PURCHASE ANY AGRICULTURAL PRODUCE FROM BORA FAM ILY. THE IMPUGNED BILLS DID NOT BEAR HIS SIGNATURES OR THE S IGNATURES OF THE OTHER TWO PARTNERS NOR THE MUNIM. THE NAMES ME NTIONED IN THE BILLS WERE NOT THE NAMES OF HIS EMPLOYEES. SIMI LAR EXAMINATION ON OATH OF RAJENDRAKUMAR ZUMBERLAL KOTH ARI, MIRAJGAON ON 16.12.2011 REVEALED THAT HE HAD NOT PU RCHASED THE AGRICULTURAL PRODUCE MENTIONED IN THE BILLS FROM TH E BORA FAMILY. THE IMPUGNED BILLS WERE NEITHER ISSUED NOR SIGNED B Y HIM AND HE DOES NOT HAVE ANY OTHER PERSON / EMPLOYEE FOR ISSUE OF BILLS. THE ASSESSING OFFICER ALSO FOUND THAT THE SALES TAX NUM BER APPEARING ON THE BILLS MENTIONED S.T NO.440441 WHEREAS THE SA LES TAX NUMBER BEARING PIN CODE NUMBER OF MIRAJGAON, I.E., 440441 WAS INTRODUCED BY THE SALES TAX DEPARTMENT W.E.F. 01.04 .1996. THE BILLS PRODUCED PERTAINED PRIOR TO 01.04.1996 AND SH OULD HAVE BORNE THE SALE TAX NO. N 20. THE THIRD PARTY THAT WAS EXAMINED ON OATH BY THE ASSESSING OFFICER ON 21.12.2011, SHR I RAJMAL SHOBHACHAND BHANDARI OF MIRAJGAON DENIED THE SALE B ILLS AND ADDED THAT THE BILLS SHOWN TO HIM THE COMPUTERIZED WHEREAS THE 8 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP BILLS ISSUED BY HIM ARE PRINTED AND NOT COMPUTERIZE D. THE ASSESSING OFFICER FURTHER NOTICED THAT THE BILLS SU BMITTED FOR SALE OF DALIMB I.E. POMEGRANATE MENTIONED THE ADDRESS AS KARAM & CO., MARKET YARD, AHMEDNAGAR FOR THE PERIOD 1987 TO 1994 WHEREAS THE MARKET FOR FRUIT AND VEGETABLES IN AHME DNAGAR UPTO THE YEAR 1990-91 WAS LOCATED AT ADATE BAZAR AHMEDNA GAR AND NOT AT MARKET YARD. THE ASSESSING OFFICER CONFRONT ED THESE EVIDENCES TO SHRI SARANG BORA, BROTHER OF ONE OF TH E ASSESSEE AND HIS STATEMENT WAS RECORDED ON OATH ON 16.12.2011. I N THE IMPUGNED STATEMENT SHRI SARANG BORA STATED THAT HE IS UNABLE TO PRODUCE THE ORIGINAL BILLS, XEROX COPIES OF WHICH W ERE FURNISHED ON 12.12.2011 TO THE ASSESSING OFFICER. SECONDLY, HE ALSO CATEGORICALLY REFUSED TO CROSS EXAMINE SHRI VIJAYKU MAR PANNALAL KOTHARI, PARTNER OF M/S ASHOK TRADING CO., MIRAJGAO N WHO HAD DENIED THE SAID BILLS. LATER ON, SHRI SARANG BORA WHO ATTENDED PROCEEDINGS BEFORE THE ASSESSING OFFICER ON 21.12.2 011 CATEGORICALLY DENIED ANY OPPORTUNITY TO CROSS EXAMI NE SHRI RAJMAL SHOBHACHAND BHANDARI WHO HAD ALSO DENIED THE SALE BILLS. ACCORDINGLY, THE ASSESSING OFFICER IN THE B ACKGROUND OF THE ABOVE STATED FACTS CONCLUDED THAT THE ASSESSEE'S CO NTENTION THAT THE OPENING CAPITAL BALANCE AROSE OUT OF THE PAST S AVINGS OF AGRICULTURAL INCOME WAS NOT FOUND CORRECT AND THE S AME WAS BROUGHT TO TAX IN THE A.Y. 1999-2000. 3.4. IN APPELLATE PROCEEDINGS, THE STAND OF THE LEA RNED AUTHORIZED REPRESENTATIVE HAS BEEN THAT THE CAPITAL FORMATION IN THE HANDS OF THE ASSESSEE AND HIS TWO BROTHERS SHRI SARANG AN D SHRI SANDEEP BORA HAD TAKEN PLACE FROM THE AGRICULTURAL ACTIVITIES SPREAD OVER ABOUT 100 ACRES OF LAND. IN THE COMMON WRITTEN SUBMISSIONS FILED ON BEHALF OF ALL THE ASSESSEES ON 22.03.2013, A LAND HOLDING CHART IN RESPECT OF THE ACTUAL LAND HO LDING VIS-A-VIS 7/12 EXTRACTS WAS ENCLOSED AND IT WAS MENTIONED THA T THOUGH IN SOME CASES, THE THREE TESTS OF LEGAL OWNERSHIP, PRO PERTY 9 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP DOCUMENTS CONFIRMING OWNERSHIP AND POSSESSION AND O CCUPATION WERE NOT SATISFIED, WHAT WAS IMPORTANT FOR IT PROCE EDINGS IS THE AGRICULTURAL INCOME WHICH WAS GENERATED FROM THESE LANDS. ALTHOUGH THE BORA FAMILY IS LARGE ONE AND THERE WER E SOME LITIGATION ON OWNERSHIP ASPECTS, YET GENERATION OF AGRICULTURAL INCOME WAS RELATED TO BENEFICIAL OWNERSHIP AND POSS ESSION OF LAND. THE WRITTEN SUBMISSIONS FILED ON BEHALF OF TH E ASSESSEE ARE REPRODUCED HEREUNDER. GROUND NO. 2 - ADDITION OF OPENING BALANCE IN CAPI TAL ACCOUNT -RS. 7,58,400 BRIEF FACTS 1. THE ASSESSEE IS AN AGRICULTURIST. ASSESSEE ALSO HAS BUSINESS INCOME. 2. RETURN OF INCOME WAS NOT FILED FOR A.Y. 1999-2000 O N THE BELIEF THAT NO TAXABLE INCOME EXISTS. 3. SURVEY TOOK PLACE ON 2/12/2003. 4. DURING THE COURSE OF SURVEY, OVERALL DECLARATION OF ADDITIONAL INCOME OF RS.54,30,220 WAS MADE. 5. THE SAID ADDITIONAL INCOME WAS REASONED AS FOLLOWS. A) RS. 40,00,000 - EXCESS STOCK FOR A.Y. 2004-05 B) RS. 5,00,000 - CONSTRUCTION IN SHOP PREMISES C) RS. 9,30,220 - INVESTMENT IN HANDS OF RESPECTIVE FAMILY MEMBERS FOR EARLIER YEARS D) RS. 54,30,220 - TOTAL 6. OVERALL DISCLOSURE WAS DISTRIBUTED IN THE HANDS OF VARIOUS BORA FAMILY MEMBERS. 7. PURSUANT TO SURVEY U/S 133A, RETURN WAS FILED ON 24/12/2003 DECLARING TOTAL INCOME OF RS. 63,400. 8. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE LE ARNED AO OBJECTED TO OPENING BALANCE IN CAPITAL ACCOUNT. 9. IT WAS EXPLAINED THAT THE SAID OPENING BALANCE IS A BUILT OF PAST MANY YEARS OF BUSINESS ACTIVITY AND EFFECT OF AGRICULTURAL ACTIVITY OF THE BORA FAMILY. 10. THE LEARNED AO DID NOT ACCEPT OPENING BALANCE PRESE NCE EXCEPT THE STOCK-IN-HAND EXISTING ON 1/4/1998. 11. ACCORDINGLY, THE EXCESS OPENING BALANCE (I.E. OPENI NG BALANCE PER STATEMENT OF AFFAIRS OPENING STOCK) W AS CONSIDERED AS TAXABLE INCOME FOR A.Y. 1999-2000. SUBMISSIONS 10 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 1. AGRICULTURAL LAND HOLDING ISSUE - THE APPELLANTS HAVE BEEN SUBMITTING FROM TIME TO TIME THAT THE CAPITAL FORMATION OF THE APPELLANT HAS TAKEN PLACE FROM THE AGRICULTU RAL ACTIVITIES SPREAD OVER ABOUT 100 ACRES OF LAND. AS PER THE FACTS, THE BORA FAMILY IS HAVING LARGE FARM LAND HO LDING AROUND AHMEDNAGAR. THE SAID LAND HOLDING EXISTS FRO M MANY YEARS. ,A CHART OF THE RELEVANT FAMILY MEMBERS AND THEIR ANTECEDENTS IS ENCLOSED HEREWITH AND MARKED A S ANNEXURE-1. FARM LANDS HELD BY THE BORA FAMILY CAN BE SEGREGATED ON THE BASIS OF FOLLOWING THREE TESTS. A) LEGAL OWNERSHIP B) PROPERTY DOCUMENTS CONFIRMING OWNERSHIP C) POSSESSION & OCCUPATION BASED ON THESE THREE CRUCIAL ASPECTS, THE APPELLANT HAS PREPARED A LAND HOLDING CHART WHICH IS ENCLOSED HER EWITH AND MARKED AS ANNEXURE-2. THE APPELLANTS HAVE BEEN SUBMITTING THAT THOUGH IN SOME OF THE CASES OF LAND OWNERSHIP, THE THREE TESTS OF - LEGAL OWNERSHIP - PROPERTY DOCUMENTS - POSSESSION ARE NOT SATISFIED, WHAT IS IMPORTANT AND CRITICAL F OR THE I-T PROCEEDINGS IS THE AGRICULTURAL INCOME WHICH IS TO GENERATE FROM THESE LANDS. AS THE BORA FAMILY IS QUITE LARGE , THERE WERE SOME LITIGATIONS ON OWNERSHIP ASPECTS OF THE L AND. HOWEVER, GENERATION OF AGRICULTURAL INCOME IS AN AS PECT RELATED ONLY TO BENEFICIAL OWNERSHIP AND POSSESSION / OCCUPATION OF THE LAND. VARIOUS FACTUAL ASPECTS WER E SUBMITTED TO SUPPORT THE CONTENTION THAT THE APPELL ANTS ARE ELIGIBLE TO GET AGRICULTURAL INCOME FROM 101 ACRES OF FARM LAND. SUBMISSIONS AS AGAINST OBJECTIONS OF THE AO PARA NO. 143(3) ORDER DATED 23/12/2011 FURTHER SUBMISSIONS 6.1 DURING SURVEY IT WAS STATED ONLY RS. 7 LACS AS SAVINGS FROM AGRICULTURAL INCOME THE DECLARATION OF RS. 7 LACS WAS ON AD-HOC BASIS. FURTHER, THE INDIVIDUAL APPELLANTS ' CAPITALS WERE ALSO SOURCED FROM THE AGRICULTURAL ACTIVITIES PURSUED FOR LAST SO MANY YEARS. 11 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 6.3 THE ASSESSEE HAS GIVEN PROOF OF HOLDING AGRI LAND ARGUING THAT BORA FAMILY IS HAVING LAND HOLDING OF 101 ACRES A SEPARATE LAND-HOLDING CHART IS ENCLOSED HEREWITH AND MARKED AS ANNEXURE-2 WHEREIN SPECIFIC LAND DETAILS ARE TABULATED FOR EASY REFERENCING. FROM THE SAID CHART, THE FACTUAL MATRIX EMERGES VERY CLEARLY THAT THE BORA FAMILY, I.E VARIOUS APPELLANTS ARE TAKING MANY CROPS IN BORA HUF WHEREFROM, THE OPENING BALANCE IS GENERATED 6.3 AO'S FINDING THAT THE ASSESSEE IS HOLDING 7 HECTOR 97R ( 20ACRE) AT GHUMARI AND SANGHAVI THE LAND WHICH PASSES ALL THE 3 TESTS, I.E. LEGAL OWNERSHIP + DOCUMENTS IN PROPER NAMES + OCCUPATION/POSSESSION IS FOR 6.63 + 7.97 +2.45 +0.88 HECTORS (17.9 3 H) = 44.83 ACRES OF LAND 6.3 OTHER LAND HOLDINGS AT HANUMNATGAON ARE NOT IN THE NAME OF ASSESSEE. THIS IS WHERE THE LEARNED AO HAS GLOSSED OVER THE FACTS. THE OTHER LANDS ARE IN POSSESSION OF THE BORA FAMILY, APPELLANTS HEREIN. THIS FACT CLEARLY EMERGES FROM THE AHMEDNAGAR COURT ORDER WHEREIN STATUS-QUO IS ORDERED. FURTHER, THE COLLECTOR HAS CERTIFIED THAT THE APPELLANT FAMILY MEMBERS ARE DERIVING INCOME FROM THE SAID LANDS. THIS CRUCIAL ASPECT IS NOT CONSIDERED BY THE AO IN PROPER PERSPECTIVE 6.4 NO AGRICULTURAL INCOME IS DECLARED IN THE RETURNS OF MR. SUGANDHILAL BORA OR IN THE BORA HUF RETURN. THE ENTIRE AGRICULTURAL ACTIVITY WAS OF THE BORA HUF. ACCORDINGLY THE SAME WAS NOT DECLARED IN THE NAMES OF THE FAMILY MEMBERS. FURTHER, IT IS SUBMITTED, THIS IS A TECHNICAL ISSUE RATHER THAN ONE OF MERITS. ON REALISTIC BASIS, THE SAI D LAND WAS CULTIVATED WHEREFROM THE AGRICULTURAL INCOME WAS BEING GENERATED ANYWAY. 6.5 TILL 7 OBJECTIONS TO BILLS OF SALE OF AGRICULTURAL PRODUCE, ETC. THE VERIFICATION PROCESS WAS CARRIED OUT IN A HIGH HANDED MANNER. DUE TO SOME FEARS OF PROBING, THE PROCESS OF VERIFICATION HAS RESULTED IN SOME INCORRECT CONCLUSIONS. 8 THE CONTENTION OF THE APPELLANT THAT THE OPENING BALANCE IN CAPITAL ACCOUNT OUGHT TO HAVE BEEN TAXABLE INCOME OF PRECEDING YEARS IS NOT ACCEPTABLE SINCE EACH YEAR IS SEPARATE, ETC. THIS WAS AN ALTERNATE CONTENTION OF THE APPELLANT. IN ANY CASE, THERE WAS NO ANY OTHER SOURCE OF OPENING BALANCE OF THE APPELLANT EXCEPT FOR SOME PAST YEARS ACTIVITIES. THE CONTENTION OF THE APPELLANT IS REJECTED ON A TECHNICAL ASPECT AND NOT ON REAL MERITS. ACCORDINGLY, THE LEARNED AO ADDED THE OPENING CAPIT AL BALANCE AS INCOME OF EACH APPELLANT IN A. Y. 1999-2 000. TO CONCLUDE, THE APPELLANT SUBMITS THE FOLLOWING KEY PROPOSITIONS. A) LAND HOLDING AREA INCORRECTLY UNDERSTOOD B) PRESENCE IN AGRICULTURAL ACTIVITY FOR PAST MANY YEA RS NOT RIGHTLY CONSIDERED C) PRESENCE OF BUSINESS ACTIVITIES FOR PAST MANY YEARS NOT RIGHTLY CONSIDERED SUBMISSIONS RELATED TO QUANTIFICATION 12 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP L. LAND HOLDING ON LEGAL OWNERSHIP BASIS - THE APP ELLANT IS ENCLOSING HEREWITH THE FOLLOWING CRUCIAL DOCUMENTS. A) LAND HOLDING PAPERS I.E. 7-12 EXTRACTS (ANNEXURE-3) B) COURT ORDER FOR STATUS QUO (ANNEXURE-4) C) COLLECTOR CERTIFICATE FOR AGRICULTURAL INCOME (ANNEXURE-5) D) SUMMARIZED STATEMENT OF AFFAIRS / BALANCE SHEETS OF 6 YEARS (ANNEXURE-6) THE LEARNED AO HAS CONSIDERED ONLY 20 ACRES OF LAND AS ELIGIBLE LAND HOLDING AND GIVEN CREDIT OF RS. 7 LAC S TOWARDS AGRICULTURAL INCOME. IF THE SAME TEST IS APPLIED FO R 44.83 ACRES OF LAND, THE LOGICAL CREDIT OUGHT TO HAVE BEE N RS.15.69 LACS AS AGAINST RS. 7 LACS. 2.LAND HOLDING ON BENEFICIAL OWNERSHIP BASIS - CONS IDERING REALITY OF SITUATION, IF ENTIRE 101 ACRES OF LAND I S CONSIDERED FOR FAIR ADJUDICATION OF DETERMINING AGRICULTURAL I NCOME, THE AGRICULTURAL INCOME GENERATING THEREFROM WORKS OUT TO RS. 35.35 LACS AS AGAINST, RS. 7 LACS. 3. REALISTIC AGRICULTURAL INCOME - THE LEARNED AO H AS GIVEN CREDIT OF RS. 7 LACS FOR 20 ACRES OF FARM LAND. THI S RATE / RATIO IS TOO DISPROPORTIONATE. FROM THE COLLECTOR'S CERTIFICATION, IT TRANSPIRES, CREDIT FOR AGRICULTUR AL INCOME WORKS OUT AS FOLLOWS. A) FOR SANGAVI, MIRAJGAON & GHUMARI LAND - 44.83 AC RES OF LAND - RS. 84,000 (1998 CERTIFICATION) X 4 PERSO NS X 6 YEARS = RS. 20.16 LACS B) FOR SANGAVI, MIRAJGAON & GHUMARI LAND FOR 44.83 ACRES OF LAND - RS.1.25 LACS (FAIR RATE) X 4 PERSONS X 6 YEARS = RS.30 LACS C) FOR HANMANTGAON LAND - 61.48 ACRES OF LAND-RS.4.55 LACS (1998 RATE) X 6 YE ARS = RS. 27.30 LACS AS SUCH, THE OVERALL AGRICULTURAL INCOME WHICH WAS AVAILABLE FOR CREDIT IS RS.57.30 LACS (RS.30 LACS + RS.27.30 LACS). FURTHER, PAST MANY YEARS, THE AGRICULTURAL ACTIVITY WAS ONGOING AND HENCE, THE ENTIRE ADDITION OF ABOUT RS. 59 LACS GETS TELESCOPED IN THE SURPLUS AVAILABLE FORM AGRIC ULTURAL ACTIVITY. 13 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 4. CREDIT FOR BUSINESS ACTIVITY - LASTLY, IT IS SUB MITTED, THE BUSINESS OF BORA FAMILY MEMBERS IS IN PRESENCE FOR LAST MANY YEARS. THE LEARNED AO HAS GRANTED CREDIT FOR O PENING STOCK. IT IS HARD TO BELIEVE THAT ALONG WITH OPENIN G STOCK NO OTHER BUSINESS ASSET EXISTS. IT IS SUBMITTED, A FAI R QUANTUM OF OTHER ASSETS, I.E. CASH BALANCE + BANK BALANCE + DEBTORS, ETC. OUGHT TO BE CONSIDERED AS PART OF OPENING BALA NCE. DETAILED CHART OF STATEMENT OF AFFAIRS OF ALL YEARS IS ENCLOSED HEREWITH ARE ALREADY SUBMITTED FOR YOUR KIND CONSID ERATION. PRAYER THE APPELLANT REQUESTS YOUR GOODSELF TO APPRECIATE VARIOUS EVIDENCES ALREADY ON RECORD AND SINCERE REQUEST OF THE APPELLANT THAT THE APPELLANT DID HOLD SUFFICIENT EC ONOMIC AFFLUENCE AS WAS NEEDED TO JUSTIFY THE OPENING BALA NCE OF CAPITAL ACCOUNT. 3.9. SUBSEQUENTLY ON 12.4.2013, DURING THE COURSE O F APPELLATE PROCEEDINGS, THE FOLLOWING SUPPLEMENTARY SUBMISSIONS ARE FILED ON BEHALF OF THE APPELLANT WH ICH STATES INTER ALIA: G) SPECIFIC SUBMISSION THE FOCUS OF ASSESSMENT AF TER THE SURVEY WAS ASSET-BASED ADDITION. ENTIRE QUESTIONING OF THE SURVEY WAS REGARDING ASSETS FOUND DURING THE COURSE OF SURVEY AND SOURCES FOR THE SAME. CONSIDERING THE TO TAL ASSETS FOUND OF RS.99,30,220/-, A DECLARATION OF RS . 54,30,220 WAS MADE FOR A.Y. 2003-04 AND A.Y. 2004-0 5 AND THE BALANCE OF RS.45,00,000 WAS REASONABLY EXPLAINE D AS PER THE FOLLOWING TABLE. WHEREAS, THE AO HAS ACCEPT ED THE POSITION OF INCOME DECLARED IN LAST 6 YEARS AND, TH E FACTUM OF AGRI ACTIVITY SOURCE OF RS.7 LACS, THE EXISTENCE OF OPENING BALANCE WAS NOT FAIRLY APPRECIATED BY THE LEARNED A O. KINDLY APPRECIATE FOLLOWING QUICK SUMMARY. SOURCES POSITION DURING SURVEY AND POST SURVEY SOURCES DECLARED IN SURVEY SOURCES AS PER RETURNS AND AS DECIDED BY AO LAST 6 YEARS INCOME 18,00,000 20,37,715 SAVINGS OF FAMILY PRIOR TO 6 YEARS 20,00,000 - FUNDS BORROWED FROM A GRI ACTIVITY IN HUF 7,00,000 7,00,000 ADDITION MADE BY THE AO FOR OPENING BALANCES - 42,15,940 THUS, IT WILL TRANSPIRE, THE OPENING BALANCE FOR LA ST MANY YEARS WAS NOT DULY AND FAIRLY CONSIDERED BY THE AO. NOW, BORA FAMILY HAS LARGE AGRI HOLDING FOR PAST MANY YE ARS. DUE CREDIT FOR THE PAST YEARS (PRIOR TO 1/4/1998) I S NOT GRANTED BY THE LEARNED AO. THESE LANDS ARE IN AGRI 14 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP CULTIVATION FOR MANY DECADES. ACCUMULATION OF ECONO MIC RESOURCES ON ACCOUNT OF THIS PAST MANY YEARS ACTIVI TY IS QUITE NATURAL. THIS FACT IS NOT BEING APPRECIATED B Y THE LEARNED AO. H) ERROR OF CONSIDERING AGRI INCOME OF RS. 7 LACS - DURING THE SURVEY OPERATIONS, IT WAS EXPLAINED THAT THE AS SETS WERE FUNDED OUT OF THE BORROWING FROM AGRI ACTIVITY AMOU NTING TO RS.7 LACS. THE QUANTUM OF RS.7 LACS WAS CLEARLY STATED AS 'BORROWING OUT OF HUF AGRI ACTIVITY' AND NOT THE IN COME FROM AGRI ACTIVITY PER SE. IT APPEARS, AN ERROR HAS CREPT IN SINCE, THE BORROWING FROM AGRI ACTIVITY IS CONSIDER ED AS AGRI INCOME. IF THE AGRI INCOME OF RS. 7 LACS IS PR ORATED TO THE CONSIDERED HOLDING OF ABOUT 20 ACRES (AND FOR A PERIOD OF 6 YEARS), THE PER ACRE AGRI INCOME WORKS OUT TO RS. 5,833 (I.E. RS. 7,00,000 / 6 YEARS / 20 ACRES) . SUCH LOW INCOME FROM A BAGAYATI LAND (I.E. A LAND HAVING PERMANENT SOURCE OF WATER) IS WHOLLY ILLOGICAL. THE APPELLANT HAS AL READY SUBMITTED EVIDENCES I.E. COLLECTOR'S CERTIFICATES I NDICATING A MUCH HIGHER AGRI INCOME OF THE APPELLANTS FOR THE S AME PERIOD. THE AGRI INCOME OUGHT TO HAVE BEEN CONSIDER ED AT A FAR MORE AMOUNT SINCE THE LAND WAS USED FOR CASH CR OPS SUCH AS SUNFLOWER, JAWAR, ETC. A FAIR ESTIMATE OF S UCH INCOME FROM AGRI ACTIVITY OUGHT TO HAVE BEEN AT LEA ST RS. 25,000 PER ACRE PER ANNUM. IT APPEARS, THE INCOME F ROM THE AGRI ACTIVITY IS LARGELY UNDER-ESTIMATED. THE ERROR CREPT INTO THE DECLARATION NEEDS A CORRECTION. I) ERROR OF TOXINS OPENING BALANCE - LASTLY, IT IS SUBMITTED, THE ENTIRE EXERCISE OF ASSESSMENT WAS ASSETS-BASED MAPPING. IN THE SPIRIT OF COMPLIANCES, THE ASSESSEE APPELLANT HAS SUBMITTED STATEMENT OF AFFAIRS SHOWIN G OPENING BALANCES OF BUSINESS. NOW, THESE OPENING BA LANCES WERE AMALGAM / COMBINATION OF MANY YEARS BUSINESS ACTIVITIES AND PAST YEARS AGRI ACTIVITIES. AS PER T HE SURVEY STATEMENT, IT WILL REVEAL THAT THE BUSINESSES WERE IN CONTINUED FOR PAST MANY YEARS. THE LEANED AO HAS AL SO ACCEPTED THE EXISTENCE OF OPENING STOCK ON 1/4/98 A ND GIVEN CREDIT OF EQUIVALENT OPENING BALANCE IN CAPIT AL ACCOUNT. BUT THE ACTIVITY WAS ON FOR MANY YEARS IN PAST. THE SAID OPENING BALANCES WERE GENERATED OUT OF BUSINES S ACTIVITIES OF PAST YEARS AS WELL AS AGRI ACTIVITY I NCOME. THIS REALITY OF LIFE CAN'T BE IGNORED JUST BECAUSE THE A PPELLANTS, HAILING FROM MOFICIL AREA AND ASSUMING PRESUMPTIVE TAXATION ROUTES, DID NOT MAINTAIN SACROSANCT ACCOUN TS. THERE OUGHT TO BE ASSUMED AN APPROACH OF REASONABIL ITY IN THIS RESPECT. 15 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP J) AGE OF THE APPELLANT - THE APPELLANT, MR. SANDEE P BORA WAS OF ABOUT 34 YEARS AGE AT THE TIME OF SURVEY. SI MILAR WERE AGES OF HIS TWO BROTHERS. APPELLANT WAS IN THE SAME BUSINESS AND AGRI ACTIVITY FOR PAST MANY YEARS (AT LEAST 10- 12 YEARS). DUE CREDIT OF THESE FACTS IS REQUESTED. K) PRAYER - AS SUCH, THE APPELLANT, WITH FOLDED HAN DS, REQUEST YOUR GOODSELF TO ASSUME A VERY REALISTIC AP PROACH AS REGARDS OPENING BALANCE OF CAPITAL. THE APPELLANT A LSO REQUESTS YOUR GOODSELF TO APPRECIATE VARIOUS EVIDEN CES ALREADY ON RECORD AND SINCERE REQUEST OF THE APPELL ANT THAT THE APPELLANT DID HOLD SUFFICIENT ECONOMIC AFFLUENC E AS WAS NEEDED TO JUSTIFY THE OPENING BALANCE OF CAPITAL AC COUNT. 3.5 HAVING CONSIDERED THE SAME, THE CIT(A) HAS OBSE RVED THAT THE ASSESSEE WAS CLAIMING AGRICULTURAL INCOME DERIV ED OUT OF JOINT LAND HOLDING BY ALL THE FAMILY MEMBERS NAMELY S/SHR I SUHAS, SANDEEP AND SARANG ALONG WITH THEIR FATHER SHRI SUG ANDHILAL BORA TO EXPLAIN CAPITAL FORMATION AS ON 01.04.1999, FOR SAME, IT WAS NECESSARY TO ARRIVE AT A DEFINITE CONCLUSION AS TO THE EXACT CULTIVATED LAND HOLDING IN THE HANDS OF THE ASSESSE E TO EVALUATE IF THE ESTIMATION OF AGRICULTURAL INCOME BY THE ASS ESSING OFFICER WAS CORRECT OR THE ESTIMATION BY THE ASSESSEES WAS CORRECT. THE CAPITAL FORMATION IN THE HANDS OF THE THREE BROTHER S INCLUDING THE ASSESSEE FOR THE IMPUGNED ASSESSMENT YEAR IS AS UND ER: 3.6 THE LANDS IN QUESTION, WERE ORIGINALLY OWNED BY THE GRANDFATHER OF THE ASSESSEE, SHRI PANNALAL CHUNNILA L BORA WHICH WAS MAINLY LOCATED AT GAT NOS.13, 287, 331, 403, 43 3 AND 434 AT HANUMANTGAON, IN AHMEDNAGAR DISTRICT. THE TOTAL LA ND HOLDING OF THE ANCESTRAL PROPERTY AT HANUMANTGAON WAS 18.85 HECTORS EQUIVALENT TO 47.12 ACRES. THE ASSESSEES HAVE CLA IMED TO HAVE SR. NO. NAME OF THE APPELLANT OPENING CAPITAL BALANCE AS ON 1.04.1999 (RS.) 1 SUHAS SUGANDHILAL BORA 7,58,400 2 SARANG SUGANDHILAL BORA 14,54,734 3 SANDEEP SUGANDHILAL BORA 13,34,449 TOTAL 35,47,583 16 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP INHERITED THE SAID LAND IN VIEW OF BENEFICIAL OWNER SHIP NAMELY OCCUPATION OF THE SAID LANDS THOUGH THE MUTATIONS W ERE NOT CARRIED OUT IN THEIR NAMES. IT WAS CONTENDED THAT THE ASSESSING OFFICER HAS GLOSSED OVER THIS FACT WHEREAS THE ORDE R OF THE CIVIL JUDGE AHMEDNAGAR COURT DATED 15.06.1992 CLEARLY MEN TIONS THAT STATUS QUO IS TO BE MAINTAINED BETWEEN THE ASS ESSEES WHO ARE PLAINTIFFS (FAMILY OF SUGANDHILAL BORA) AND THE DEFENDANTS (SUNGANDHILAL'S FATHER, SHRI PANOALAL CHUNILAL BORA , BROTHER, SHRI KANTILAL BORA AND SIX SISTERS), ALTHOUGH THE ASSESS EES CONTEND TO HAVE OWNERSHIP AND POSSESSION OVER THE SAID PROPERT IES. FROM THE ORDER OF THE COURT MENTIONED ABOVE, IT WAS FOUN D THAT THE PROPERTIES IN QUESTION, AT HANUMANTGAON DESCRIBED A BOVE, IS BOTH ANCESTRAL AS WELL AS JOINT FAMILY PROPERTY. B UT THE FAMILY OF SUGANDHILAL BORA HAS CLAIMED SOLE OWNERSHIP OVER TH E PROPERTY AND, IN THE ALTERNATIVE, CLAIMED COPARCENER RIGHTS IN THE PROPERTY. IT WAS STATED THAT THE OTHER PART OF THE FAMILY COM PRISING SHRI KANTILAL BORA AND HIS SISTERS HAD RELINQUISHED THEI R RIGHTS, TITLE AND INTEREST IN THIS PROPERTY BY ACCEPTING HUGE AMO UNTS OF CASH AND ORNAMENTS. THE SUIT MENTIONS THAT THE SETTLEME NT THAT HAS BEEN REACHED WITH SHRI KANTILAL BORA AND HIS SI STERS WHO, THEREFORE, HAVE NO RIGHT TO DEMAND ANY SHARE IN THE PROPERTY, WAS NOT RECORDED IN THE LAND REVENUE RECORDS. IT W AS ALSO SEEN FROM THE ORDER THE ONGOING DISPUTE BETWEEN THE FAMI LY MEMBERS HAS ARISEN BECAUSE OF THE TRANSFER OF PROPERTIES IN THE NAMES OF THE GRANDDAUGHTERS AND GRANDSONS I.E. THE CHILDREN OF THE DEFENDANTS SHRI KANTILAL BORA AND HIS SISTERS. IN T HIS BACKGROUND, IT WAS CONSIDERED WHETHER THE ASSESSEES CONTENTION THAT THE ASSESSEE AND HIS BROTHERS WERE DERIVING IN COME FROM THE SAID LANDS COULD BE ACCEPTED AS TRUE. ON EXAMINATI ON OF THE IMPUGNED 7/12 DOCUMENTS IN RESPECT OF THE HANUMANTG AON LAND REVEALS THAT THE OWNERSHIP VESTS WITH SHRI PANNALAL CHUNNILAL BORA, KANTILAL PANNALAL BORA, HIS CHILDREN AND THEI R WIVES AND THE SISTERS OF KANTILAL BORA. THE ASSESSING OFFICE R HAS ALSO 17 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP OBSERVED IN THE ASSESSMENT ORDER THAT THE 7/12 EXTR ACTS FOR THE IMPUGNED LANDS MENTION THE LANDS AS 'SELF-CULTIVATE D', WHICH IS CONTRARY TO THE ASSERTION BY THE ASSESSEE & HIS BRO THERS THAT THEY WERE IN POSSESSION OF THE LANDS & DERIVING AGRICULT URAL INCOME THERE FROM. IT WAS ALSO FOUND THAT THE LANDS LOCAT ED AT GAT NO.331 AND 433 IN HANUMANTGAON WERE ALSO ASSIGNED T O CERTAIN PERSONS NAMELY DAGADABAI RAOSAHEB PANDHARE, NAVNATH ANAND PANDHARE, RAMDAS SADASHIV, MUKTABAI RAMACHANDRA, PA RASRAM VITHOBA, VIMAL SARJERAO, BHARAT GANPAT, AND INDUBAI NAKA. THE ASSESSEE HAS EXPLAINED THAT THESE ARE PERSONS TO WH OM PART OF THE LAND HOLDINGS WERE SOLD BY THE ANCESTOR OF THE BORA FAMILY AND THAT WHILE COMPUTING THE BORA FAMILY LAND AREA, LAND POSSESSED/OWNED BY SUCH OUTSIDER STRANGERS WERE NOT CONSIDERED. IN THIS BACKGROUND, IT WAS FOUND THAT THE ASSESSEE AND HIS BROTHERS' CLAIMS THAT THEY ARE BENEFICIAL O WNER AND ARE IN OCCUPATION OF LANDS WAS FOUND NOT CORRECT. HOWEVER , IT WAS SEEN FROM THE 7/12 EXTRACTS OF THE LAND LOCATED AT GAT N O.433 IN HANUMANTGAON, THAT SHRI SUGANDHILAL BORA HOLDS 6 AC RES OF THE LAND. AT THE MOST THEREFORE, KEEPING IN VIEW THE C LAIM OF BENEFICIAL LAND HOLDING ON THE PART OF THE FAMILY B EFORE THE CIVIL COURT, AHMEDNAGAR, THE BENEFIT OF 6 ACRES OR 2.45 H ECTORS WAS AVAILABLE TO HIM. THE CLAIM OF BENEFICIAL OWNERSHI P (CLAIMED AT HALF FOR THE SUGANDHILAL FAMILY FOR THE LANDS OWNED BY PANNALAL CHUNNILAL BORA AS PER THE WRITTEN SUBMISSIONS MENTI ONED AT PARA 3.7 ABOVE) AND CONSEQUENTLY ENTITLED TO BENEFI T OF AGRICULTURAL INCOME DERIVED FROM ALL THE LANDS LOCA TED AT HANUMANTGAON WAS NOT FOUND ACCEPTABLE. THIS REASON ED FINDING OF CIT(A) NEEDS NO INTERFERENCE FROM OUR SIDE BECAU SE THE ASSESSEE COULD NOT ESTABLISH HIS CLAIM BY THE COGEN T REASONING AND MOREOVER, IT IS NOT APPROPRIATE FOR US TO COMME NT ON THE CIVIL PROCEEDINGS SUBJUDICE AT THE CONCERNED CIVIL COURTS ON THIS ISSUE AT RELEVANT POINT OF TIME. APART FROM THIS, THE ST ATUS QUO CLAIMED TO BE GRANTED IN FAVOUR OF THE ASSESSEE DOES NOT HE LP IN VIEW OF 18 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP CULTIVATION POSSESSION LIES WITH PERSONS OTHER THAN ASSESSEES. IN VIEW OF THIS, WE UPHOLD THE SAME. 4. COMING TO THE OTHER LANDS LOCATED AT MIRAJGAON, GHUMARI AND SANGVI, AN EXAMINATION OF 7/12 EXTRACTS SUBMITT ED BY THE ASSESSEES SHOWS THE FOLLOWING LAND HOLDING IN THE H ANDS OF THE VARIOUS FAMILY MEMBERS AS UNDER: DESCRIPTION OF LAND WITH GAT NO. AND TOTAL AREA SUGANDHILAL BORA SUHAS BORA SANDEEP BORA SARANG BORA 131 MIRAJGAON (6.63 H) COMMONLY HELD COMMONLY HELD COMMONLY HELD COMMONLY HELD 348/1 GHUMARI (15.78 H) 1 H 87 R 1 H88 R 1 H 88 R 1 H88R 348/2 GHUMARI (0.08 H) 0 H 8R - - - 302 SANGVI (0.1 9 H) 0 H 19R - - - 56/1 1 SANGVI (0.07 H) 0.07 H - - - 56/02 SANGVI (0.88 H) 0.88 H - - - 433 HANUMANTGAON (5.65 H) 2.45 H - - - TOTAL HOLDING (17.93 H) OR 44.83 ACRES 4.1 THE ADDITIONAL FACTS THAT HAS TO BE BORNE IN MI ND WHILE ESTIMATING THE QUANTUM OF AGRICULTURAL INCOME THAT COULD BE POSSIBLY DERIVED FROM A LAND HOLDING OF AROUND 44 A CRES WERE ALSO CONSIDERED. IT WAS FOUND THAT NO AGRICULTURAL INCO ME WAS DECLARED IN THE RETURNS OF THE ASSESSEES OR HIS FAT HER OR BY THE HUFS EITHER BEFORE THE SURVEY OR AFTER THE SURVEY. THE STAND OF THE ASSESSEE HAS BEEN THAT THE AGRICULTURAL ACTIVIT Y WAS CONDUCTED BY THE BORA FAMILY SMALLER HUF AND THEREF ORE, NO RETURNS WERE FILED IN THE NAMES OF THE FAMILY MEMBE RS IN THE BELIEF THAT NO TAXABLE INCOME HAS EXISTS. IN THIS REGARD, IT WAS ALSO SUBMITTED THAT THIS IS A TECHNICAL ISSUE RATHE R THAN ONE ON MERITS. REALISTICALLY THE LAND HAS BEEN CULTIVATED AND THE INCOME WAS BEING GENERATED ANYWAY. IT IS GENERAL PROPOSIT ION THAT ONCE THE LAND IS UNDER CULTIVATION INCOME IS BOUND TO AR ISE. IN VIEW OF 19 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP ABOVE DISCUSSION, WE FIND THAT THE ASSESSEE COULD N OT ESTABLISH HIS EXCLUSIVE CULTIVATION POSSESSION ON THE DISPUTE D LAND AS THE DISPUTES WERE SUBJUDICE AT THE RELEVANT POINT OF TI ME AT CONCERNED JUDICIAL FORUM. THE DISPUTE IS PRIMARILY RELATED TO THE AGRICULTURAL HOLDING AT HANUMANTGAON. WHILE THE AS SESSEE'S SMALLER HUF WAS CLAIMING TO HAVE BENEFICIAL OWNERSH IP AND OCCUPATION OF THESE LANDS, THE LARGER HUF COMPRISIN G OF PANNALAL CHUNNILAL BORA AND HIS SON KANTILAL BORA AND OTHER DAUGHTERS AND THEIR GRAND CHILDREN HAS ALLEGEDLY ALIENATED SO ME OF THESE LANDS AND HOUSE PROPERTY AT HANUMANTGAON. IN THESE CIRCUMSTANCES, IT WAS FOUND DIFFICULT TO ACCEPT THE ASSESSEE'S CONTENTION THAT IT WAS IN RECEIPT OF HUF AGRICULTUR AL INCOME FROM THE SAID LANDS. FURTHER, EVEN IF ADMITTING BUT NOT ASSUMING THAT THE ASSESSEE'S WERE ABLE TO DERIVE SOME AGRICULTURA L CROPS FROM THE LARGER HUF IT WOULD NEITHER BE SUBSTANTIAL SO A S TO EXPLAIN THE CAPITAL GENERATION TO THE TUNE OF RS.35 LAKHS B UT UNDENIABLY, SOME PART OF IT WOULD ALSO BE UTILIZED FOR DOMESTIC CONSUMPTION. AS DISCUSSED ABOVE, THEY COULD NOT ESTABLISH BEYOND DOUBT THE CULTIVATE HOLDING OF THE DISPUTED LAND AND INCOME T HEREFROM. 4.2 IN THIS BACKGROUND, THE LARGE SCALE AGRICULTURA L ACTIVITIES AND INCOME THEREOF WAS LOOKED WITH DOUBTS BY THE AS SESSING OFFICER ESPECIALLY WITH REGARD TO THE SALE BILLS FO R AGRICULTURAL PRODUCE AS SUBMITTED BY THE ASSESSEE DURING THE SET ASIDE ASSESSMENT PROCEEDINGS U/S 143(3) R.W.S. 254 OF THE INCOME TAX ACT. THE VERIFICATION BY THE ASSESSING OFFICER WAS MENTIONED IN GREAT DETAILS AT PAGES 13 TO 18 OF THE ASSESSMENT O RDER, THE GIST OF WHICH HAS BEEN REPRODUCED ABOVE. THE ASSESSEE HAS MERELY COMMENTED THAT THE PROCESS OF VERIFICATION HAS RESU LTED IN SOME INCORRECT CONCLUSIONS DUE TO THE FEARS OF PROBING ( APPARENTLY ON THE PART OF THE PURCHASERS OF THE SAID PRODUCE). I T WAS ALSO OBJECTED THAT THE VERIFICATION PROCESS WAS CARRIED OUT IN A HIGH HANDED MANNER. HOWEVER, THERE WERE NO DETAILS FURN ISHED AS TO 20 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP WHICH ASPECT OF VERIFICATION PROCESS HAS MADE THE A SSESSEE COME TO A CONCLUSION THAT THE PROCESS WAS HIGH HANDED AN D NOT OBJECTIVE. IT WAS FOUND THAT THE ASSESSEE HAS FAIL ED TO PRODUCE THE ORIGINAL SALE BILLS (MENTIONED AS TOTAL NO. 234 BILLS AMOUNTING TO RS.92,07,139 ) ISSUED IN THE NAMES OF THE ASSESS EE, HIS BROTHERS AND FATHER FROM THE VARIOUS TRADERS IN MIR AJGAON AND AHMEDNAGAR. THE MAIN PURCHASERS M/S ASHOK TRADING CO. AT MIRAJGAON, RAJMAL SHOBHACHAND BHANDARI AND RAJENDRA KUMAR ZUMBERLAL KOTHARI HAVE DENIED THE ISSUANCE OF SUCH PURCHASE BILLS. WHEN CONFRONTED WITH THE DENIALS, THE ASSESS EE HAS REFUSED THE OPPORTUNITY FOR CROSS EXAMINATION OF THE SAID P ARTIES. FROM THE ABOVE MANNER OF CONDUCTING THE VERIFICATION PRO CEEDINGS, IT COULD NOT BE SAID THAT THE ASSESSING OFFICER HAS BE EN HIGH HANDED OR UNFAIR IN CARRYING OUT THE EXERCISE IN TH IS REGARD. 4.3 IT WAS ALSO FOUND THAT DURING THE COURSE OF ASS ESSMENT PROCEEDINGS, THE ASSESSEE HAS TAKEN THE STAND THAT SINCE THE OPENING CAPITAL BALANCE FOR A.Y. 1999-2000 WAS THE SAME AS THE CLOSING BALANCE IN THE CAPITAL ACCOUNT FOR A.Y. 199 8-99, THERE COULD NOT BE ANY ADDITION ON THIS ACCOUNT FOR A.Y. 1999-2000. THIS CONTENTION OF THE ASSESSEE WAS NOT ACCEPTED SI NCE, PRIOR TO THE SEARCH, ONLY ONE RETURN OF INCOME WAS FILED IN RESPECT OF A.Y. 2003-04, WHEREIN AN INCOME OF RS.1,38,550/- HAD BEE N DECLARED. IT WAS ONLY AFTER THE SURVEY WAS CONDUCTED ON 02.12 .2003, UNEARTHING TOTAL UNACCOUNTED INVESTMENT OF RS.99,30 ,220/- IN THE HANDS OF THE BORA FAMILY, THAT THE ASSESSEE FIL ED A STATEMENT OF AFFAIRS FOR THE PERIOD 31.03.1999 TO 31.03.2004 SHOWING AN OPENING CAPITAL BALANCE OF RS.7,58,400/- (IN THE CA SE OF ASSESSEE), RS.13,34,449/- (IN THE CASE OF SANDEEP S UGANDHILAL BORA) AND RS.13,34,449/- (IN THE CASE OF SARANG SUG ANDHILAL BORA). THIS WAS APPARENTLY DONE IN ORDER TO EXPLAI N THE BALANCE UNACCOUNTED INVESTMENT OF AROUND RS.45 LAKHS WHICH REMAINED TO BE EXPLAINED AFTER DECLARATION OF RS.55 LAKHS IN THE HANDS OF 21 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP VARIOUS FAMILY MEMBERS. IT WAS BASED ON THIS FILIN G OF STATEMENT OF AFFAIRS THAT THE ASSESSING OFFICER HAS RIGHTLY I SSUED 148 NOTICES AND COMPLETED THE ASSESSMENT WHICH HAS ALREADY UNDE RGONE ONE CYCLE OF APPEAL RIGHT UPTO ITAT PUNE. THEREFORE, I T WAS FOUND THAT TO RAISE THIS CONTENTION AT THIS STAGE IN THE ASSESSMENT PROCEEDINGS PURSUANT TO ITAT ORDER WAS NOT UNACCEPT ABLE AND ALSO UNJUSTIFIED. WE AGREE WITH THIS FINDING OF AU THORITIES BELOW ON THIS ACCOUNT. 4.4 REGARDING CONTENTION OF THE ASSESSEE THAT SINCE THE ENTIRE EXERCISE OF ASSESSMENT WAS ASSET BASED MAPPING, THE ASSESSEE HAD SUBMITTED STATEMENT OF AFFAIRS SHOWING THE OPEN ING BALANCE OF CAPITAL. THESE OPENING BALANCES WERE COMBINATIO N OF BUSINESS AND AGRICULTURAL ACTIVITIES OVER MANY YEARS, WHICH WAS REVEALED AS PER SURVEY STATEMENT. FIRST OF ALL, THIS PLEA OF TELESCOPING OF PAST YEARS' BUSINESS INCOME IS SEEN TO HAVE BEEN AC CEPTED BY THE ASSESSING OFFICER WHO HAS TAKEN COGNIZANCE OF THE O PENING STOCK AS ON 01.04.1999 IN THE CASES OF SHRI SARANG BORA (RS.9,23,000/-) AND SHRI SANDEEP BORA (RS.5,27,000/ -) AND MADE AN ADDITION TO THE BALANCE OPENING CAPITAL ONL Y. SECONDLY, THE AGRICULTURAL INCOME IN THE PAST COULD NOT BE ES TABLISHED FROM THE RECORD AS IN THE CASE OF THE BUSINESS INCOMES, ON THE BASIS OF THE FIGURES OF RETURNED INCOMES, WHICH THE ASSESSIN G OFFICER SEEMS TO HAVE ACCEPTED AT A CUMULATIVE FIGURE OF RS .18 TO 19 LAKHS. IN THIS BACKGROUND CIRCUMSTANTIAL EVIDENCES ENUMERATED ABOVE, AND ALSO CONSIDERING THE EXACT LAND HOLDING IN THE HANDS OF THE ASSESSEE AND HIS BROTHERS, IT WAS FELT THAT THE AGRICULTURAL INCOME SO DERIVED FROM A LAND HOLDING OF MAXIMUM 44 ACRES OF LAND COULD NOT BE EXPECTED TO COVER THE CAPITAL FOR MATION OF RS.35 LAKHS IN THE HANDS OF THE THREE ASSESSEES BEFORE US . THE ASSESSING OFFICER HAS CONSIDERED 20 ACRES OF LAND A S ELIGIBLE LAND HOLDING AND GIVEN CREDIT OF RS.7 LAKHS, AS ORIGINAL LY ADMITTED BY THE ASSESSEES DURING SURVEY PROCEEDINGS AS THE APPR OXIMATE 22 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP AMOUNT EARNED FROM THE HUF AGRICULTURAL INCOME. TH E STAND OF THE ASSESSEE HAS BEEN THAT AN AVERAGE YIELD OF AGRI CULTURAL INCOME OF RS.5583 PER ACRE WHICH WAS TOO LOW CONSID ERING THAT IT WAS BAGAYAT LAND. THE ASSESSEES HAVE REQUESTED BEF ORE THE CIT(A) THAT THE FAIR ESTIMATE OF AGRICULTURAL INCOM E OUGHT TO HAVE BEEN AT LEAST RS. 25,000 PER ACRE PER ANNUM, SPECIA LLY SINCE CASH CROPS LIKE JOWAR AND SUNFLOWER WERE GROWN. HOWEVER , CONSIDERING THAT THE RATES ANTEDATED TO THE PERIOD 1992-1998, A MORE REASONABLE ESTIMATION OF AGRICULTURAL INCOME W AS FOUND TO BE RS.10,000 PER ACRE PER ANNUM. ADOPTING THE SAME RATIO TO 44 ACRES OF LAND, OVER A PERIOD OF SIX YEARS, THE MAXI MUM CREDIT THAT COULD BE GIVEN IN RESPECT OF HUF AGRICULTURAL INCOM E WAS FOUND TO BE RS.27 LAKHS. THE ASSESSING OFFICER HAS ALREA DY GIVEN CREDIT FOR RS.7 LAKHS AS PER SURVEY STATEMENT. SINCE IT I S HUF INCOME, EACH OF THE ASSESSEES (S/SHRI SUHAS, SANDEEP AND SA RANG) ALONG WITH THEIR FATHER SHRI SUGANDHILAL BORA WOULD BE EN TITLED TO A 1/4 TH SHARE OF THE BALANCE HUF AGRICULTURAL INCOME OF RS.20,00,000/-. ACCORDINGLY, THE ASSESSEE WAS GRAN TED RELIEF OF 1/4 TH SHARE AMOUNTING TO RS.5,00,000/- FROM THE TOTAL AD DITION OF RS.7,58,400/- IN RESPECT OF OPENING CAPITAL BALANCE AS ON 01.04.1998. 5. BEFORE US, BOTH PARTIES REQUESTED FOR FAIR ESTIM ATION OF THE INCOME FROM THE AGRICULTURAL LAND HOLDING. AS DISC USSED ABOVE, THERE WERE CERTAIN DISPUTES WITH REGARD TO THE LAND S AT HANUMANTGAON AND AFTER TAKING ALL FACTS AND CIRCUMS TANCES, IT WAS REASONABLY CONCLUDED THAT THE MAXIMUM 44 ACRES OF LAND WAS IN THEIR CULTIVABLE POSSESSION AT THE RELEVANT POINT OF TIME. THE ASSESSING OFFICER HAS ESTIMATED THE AGRICULTURA L INCOME OF RS.5,583/- PER ACRE WHICH WAS ENHANCED TO RS.10,000 /- PER ACRE BY THE CIT(A). HAVING APPRECIATED TO THE IRRIGATED LAND IN CULTIVATABLE POSSESSION OF THE ASSESSEE, AS DISCUSS ED ABOVE, WE ARE OF THE VIEW THAT THE ASSESSEE WILL GET AGRICULT URAL INCOME OF 23 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP ABOUT RS.12,000/- PER ACRE FROM THE UNDISPUTED LAND HOLDING. THE ASSESSING OFFICER IS DIRECTED TO RE-COMPUTE THE AGRICULTURAL INCOME OF THE ASSESSEE IN THE LIGHT OF ABOVE. THE ASSESSING OFFICER IS DIRECTED ACCORDINGLY. THIS WILL TAKE CA RE OF ISSUE OF ESTIMATION OF AGRICULTURAL INCOME IN OTHER APPEALS OF THE ASSESSEE AS WELL. 6. REGARDING GROUND NO.6, NOTHING WAS ADDRESSED BEF ORE US BY THE LEARNED AUTHORIZED REPRESENTATIVE. SO, WE ARE NOT INCLINED TO INTERFERE WITH THE FINDING OF CIT(A) WHO HAS CONFIR MED THE ADDITION WITH RESPECT TO LOAN FROM ASSESSEES FATHE R SUGANDHILAL BORA AMOUNTING TO RS.4,50,000/- BECAUSE THE ASSESSE E COULD NOT SUBSTANTIATE ITS CLAIM BY COGENT REASONING. WE UPH OLD THE SAME. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED AS INDICATED ABOVE. 8. IN ITA NO.1097/PN/2013 FOR A.Y. 2004-05, THE ASS ESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT(A)-I PUNE ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION MADE BY ACIT, WARD 4, AHMED NAGAR U/S 68 AMOUNTING TO RS.200,000/- AS FICTITIOUS CRED IT IN SPITE OF CONFIRMATION OF LOAN FROM SUGANDHILAL BORA (HUF). 2. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT ESTIMATING AGRICULTURAL INCOME OUT OF HUF AGRICULTU RAL INCOME FOR PERIOD 1999-00 TO 2004-05 AS ESTIMATED F OR PERIOD PRIOR TO 1-04-1998 AT RS. 10,000/-PER ACRE. 3. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT APPRECIATING FACT THAT THE ASSESSEE IS BENEFICIAL O WNER & CULTIVATOR OF HUF AGRICULTURAL LAND SITUATED AT HANUMANTGAON. 4. THE APPELLANT CRAVES LEAVE TO ADD / MODIFY / ALTER / DELETE ALL / ANY OF THE GROUNDS OF APPEAL. 24 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 8.1 THE ISSUE OF ESTIMATING AGRICULTURAL INCOME OUT OF HUF AGRICULTURAL INCOME HAS BEEN DECIDED IN ITA NO.1096 /PN/2013 VIDE PARA 5 OF THIS ORDER WHICH WILL TAKE CARE OF I SSUE RAISED IN GROUND NOS.2 & 3. THIS WILL TAKE CARE OF SIMILAR I SSUE IN OTHER TWO ASSESSEES APPEALS. THE ASSESSING OFFICER IS D IRECTED ACCORDINGLY. 8.2 THE ONLY ISSUE REMAINED IS WITH REGARD TO THE A DDITION MADE U/S.68 OF THE ACT AMOUNTING TO RS.2,00,000/-. THE ASSESSING OFFICER HAS NOTICED THAT THE ASSESSEE HAD SHOWN LOA N OF RS.2,00,000/- FROM HIS FATHER SHRI SUGANDHILAL BORA . THIS LOAN WAS APPARENTLY SOURCED FROM AGRICULTURAL INCOME. H OWEVER, THE ASSESSING OFFICER DID NOT ACCEPT THIS CONTENTION IN THE ABSENCE OF ANY RETURNS FILED BY SHRI SUGANDHILAL BORA OR HIS H UF EVIDENCING AGRICULTURAL INCOME. THE ONLY RETURN FILED AFTER S URVEY IN THE CAPACITY OF INDIVIDUAL AND HUF WAS TO EXPLAIN THE I NVESTMENT IN THE FLAT AT KOHINOOR GARDENS, AHMEDNAGAR. THE ASSE SSING OFFICER PROCEEDED TO DISBELIEVE THE LOAN GIVEN BY T HE FATHER OF THE ASSESSEE IN THE LIGHT OF HER FINDING FOR A.Y. 1999- 2000 THAT THE AGRICULTURAL INCOMES WERE NOT GENUINE AND ADDED THE SAME U/S.68 OF THE ACT. IN APPEAL, THE SAME WAS CONFIRM ED BY THE CIT(A) VIDE DETAILED REASONING AT PARA 10.2 OF ITS ORDER. NOTHING WAS ADDRESSED ON THIS ACCOUNT ON BEHALF OF THE LEAR NED AUTHORIZED REPRESENTATIVE. SO, WE ARE NOT INCLINED TO INTERFERE WITH THE FINDING OF CIT(A) WHO HAS CONFIRMED THE OR DER OF ASSESSING OFFICER WHO HAS ADDED THE INCOME OF RS.2, 00,000/- U/S.68 OF THE ACT CLAIMED TO BE SHOWN AS LOAN FROM HIS FATHER SHRI SUGANDHILAL BORA OUT OF AGRICULTURAL INCOME BE CAUSE THE ASSESSEE COULD NOT SUBSTANTIATE ITS CLAIM BY COGENT REASONING. THIS REASONED FINDING OF CIT(A) NEEDS NO INTERFEREN CE FROM OUR SIDE. WE UPHOLD THE SAME. 9. IN THE RESULT, THIS APPEAL OF ASSESSEE IS ALSO P ARTLY ALLOWED. 25 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 10. IN ITA NO.1098/PN/2013 FOR A.Y. 1999-2000, THE ASSESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT(A)-I PUNE ERRED IN LAW AND ON FACTS IN CONFIRMING THE PART OF THE ADDITION MADE BY ACIT, W ARD 4, AHMEDNAGAR AMOUNTING TO RS.9,54,734/- (I.E. RS. 14, 54,734 - RS.5,00,000) PERTAINING TO OPENING CAPITAL BALANC E ON 01-04-1998. 2. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT APPRECIATING FACT THAT THE ASSESSEE IS BENEFICIAL O WNER & CULTIVATOR' OF HUF AGRICULTURAL LAND SITUATED AT HANUMANTGAON AND HENCE, QUANTIFICATION OF AGRICULTU RAL INCOME OUGHT TO HAVE BEEN MADE ON TOTAL LAND HOLDIN G OF 104 ACRES INSTEAD OF 44 ACRES. 3. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN EST IMATING AGRICULTURAL INCOME RS.10,000 PER ACRE. THE LEARNED (CIT(A)- I, PUNE OUGHT TO HAVE APPRECIATED THAT YEARLY INCOM E OF RS. 10,000 PER ACRE ARE VERY LOW AND DISPROPORTIONATE T O REALISTIC LEVEL. 4. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT GIVING PROPORTIONATE TELESCOPING OF SHARE OF AGRICULTU RAL INCOME OF ASSESSEE'S FATHER SUGHANDHILAL BORA AMOUNTING TO RS.5,00,000/- 5. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN TELESCOPING ESTIMATED AGRICULTURAL INCOME OF RS. 7, 00,000 PERTAINING TO YEARS 1999-00 TO 2004-05 WITH AGRICUL TURAL INCOME PRIOR TO 01/04/1998. 6. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN CON FIRMING THE ADDITION WITH RESPECT TO LOAN FROM ASSESSEE'S F ATHER SUGANDHILAL BORA AMOUNTING TO RS. 4,50,000/- WITHOU T ADJUDICATING THE MATTER ON MERITS 7. THE APPELLANT CRAVES LEAVE TO ADD / MODIFY / ALTER / DELETE ALL / ANY OF THE GROUNDS OF APPEAL. 10.1 A SIMILAR ISSUE OF ESTIMATING AGRICULTURAL INCOME OUT OF HUF AGRICULTURAL INCOME HAS BEEN DECIDED IN ITA NO.1096/PN/2013 VIDE PARA 5 OF THIS ORDER, WHICH WI LL TAKE CARE OF THIS ISSUE. THE ASSESSING OFFICER IS DIRECTED A CCORDINGLY. 26 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 10.2 THE ONLY ISSUE REMAINED IS WITH REGARD TO TH E ADDITION MADE U/S.68 OF THE ACT AMOUNTING TO RS.4,50,000/-. NOTHING WAS ADDRESSED ON THIS ACCOUNT ON BEHALF OF THE LEAR NED AUTHORIZED REPRESENTATIVE. SO, WE ARE NOT INCLINED TO INTERFERE WITH THE FINDING OF CIT(A) WHO HAS CONFIRMED THE OR DER OF ASSESSING OFFICER WHO HAS ADDED THE INCOME OF RS.4, 50,000/- U/S.68 OF THE ACT CLAIMED TO BE SHOWN AS LOAN FROM HIS FATHER SHRI SUGANDHILAL BORA OUT OF AGRICULTURAL INCOME BE CAUSE THE ASSESSEE COULD NOT SUBSTANTIATE ITS CLAIM BY COGENT REASONING. THIS REASONED FINDING OF CIT(A) NEEDS NO INTERFEREN CE FROM OUR SIDE. WE UPHOLD THE SAME. 11. IN THE RESULT, THIS APPEAL OF ASSESSEE IS ALSO PARTLY ALLOWED. 12. IN ITA NO.1099/PN/2013 FOR A.Y. 2004-05, THE AS SESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT(A)-I PUNE ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION MADE BY ACIT, WARD 4, AHMED NAGAR U/S 68 AMOUNTING TO RS.5,00,000/- AS FICTITIOUS CRE DIT IN SPITE OF CONFIRMATION OF LOAN FROM SUGANDHILAL BORA (HUF). 2. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT ESTIMATING AGRICULTURAL INCOME OUT OF HUF AGRICULTU RAL INCOME FOR PERIOD 1999-00 TO 2004-05 AS ESTIMATED F OR PERIOD PRIOR TO 1-04-1998 AT RS. 10,000/-PER ACRE. 3. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT APPRECIATING FACT THAT THE ASSESSEE IS BENEFICIAL O WNER & CULTIVATOR OF HUF AGRICULTURAL LAND SITUATED AT HANUMANTGAON. 4. THE APPELLANT CRAVES LEAVE TO ADD / MODIFY / ALTER / DELETE ALL / ANY OF THE GROUNDS OF APPEAL. 12.1 THE ISSUE OF ESTIMATING AGRICULTURAL INCOME OUT OF HUF AGRICULTURAL INCOME HAS BEEN DECIDED IN ITA NO.1096 /PN/2013 VIDE PARA 5 OF THIS ORDER, WHICH WILL TAKE CARE OF THIS ISSUE. THE ASSESSING OFFICER IS DIRECTED ACCORDINGLY. 27 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 12.2 THE ONLY ISSUE REMAINED IS WITH REGARD TO T HE ADDITION MADE U/S.68 OF THE ACT AMOUNTING TO RS.5,00,000/-. NOTHING WAS ADDRESSED ON THIS ACCOUNT ON BEHALF OF THE LEAR NED AUTHORIZED REPRESENTATIVE. SO, WE ARE NOT INCLINED TO INTERFERE WITH THE FINDING OF CIT(A) WHO HAS CONFIRMED THE OR DER OF ASSESSING OFFICER WHO HAS ADDED THE INCOME OF RS.5, 00,000/- U/S.68 OF THE ACT CLAIMED TO BE SHOWN AS LOAN FROM HIS FATHER SHRI SUGANDHILAL BORA OUT OF AGRICULTURAL INCOME BE CAUSE THE ASSESSEE COULD NOT SUBSTANTIATE ITS CLAIM BY COGENT REASONING. THIS REASONED FINDING OF CIT(A) NEEDS NO INTERFEREN CE FROM OUR SIDE. WE UPHOLD THE SAME. 12.3 IN THE RESULT, THIS APPEAL OF ASSESSEE IS AL SO PARTLY ALLOWED. 13. IN ITA NO.1100/PN/2013 FOR A.Y. 1999-2000, THE ASSESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT(A)-I PUNE ERRED IN LAW AND ON FACTS IN CONFIRMING THE PART OF THE ADDITION MADE BY ACIT, W ARD 4, AHMEDNAGAR AMOUNTING TO RS.8,34,449/- (I.E. RS. 13,34,449 - RS.5,00,000) PERTAINING TO OPENING CAPI TAL BALANCE ON 01-04-1998. 2. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT APPRECIATING FACT THAT THE ASSESSEE IS BENEFICIAL O WNER & CULTIVATOR' OF HUF AGRICULTURAL LAND SITUATED AT HANUMANTGAON AND HENCE, QUANTIFICATION OF AGRICULTU RAL INCOME OUGHT TO HAVE BEEN MADE ON TOTAL LAND HOLDIN G OF 104 ACRES INSTEAD OF 44 ACRES. 3. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN EST IMATING AGRICULTURAL INCOME RS.10,000 PER ACRE. THE LEARNED CIT(A)-I, PUNE OUGHT TO HAVE APPRECIATED THAT YEARL Y INCOME OF RS.10,000 PER ACRE ARE VERY LOW AND DISPROPORTIONATE TO REALISTIC LEVEL. 4. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT GIVING PROPORTIONATE TELESCOPING OF SHARE OF AGRICULTU RAL INCOME OF ASSESSEE'S FATHER SUGHANDHILAL BORA AMOUN TING TO RS.5,00,000/- 28 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 5. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN TELESCOPING ESTIMATED AGRICULTURAL INCOME OF RS.7,0 0,000 PERTAINING TO YEARS 1999-00 TO 2004-05 WITH AGRICUL TURAL INCOME PRIOR TO 01/04/1998. 6. THE APPELLANT CRAVES LEAVE TO ADD / MODIFY / ALTER / DELETE ALL / ANY OF THE GROUNDS OF APPEAL. 13.1 A SIMILAR ISSUE OF ESTIMATING AGRICULTURAL I NCOME OUT OF HUF AGRICULTURAL INCOME HAS BEEN DECIDED IN ITA NO.1096/PN/2013 VIDE PARA 5 OF THIS ORDER, WHICH WI LL TAKE CARE OF THIS ISSUE. THE ASSESSING OFFICER IS DIRECTED A CCORDINGLY. 13.2 THE ONLY ISSUE REMAINED IS WITH REGARD TO THE ADDITION MADE U/S.68 OF THE ACT AMOUNTING TO RS.5,00,000/-. NOTHING WAS ADDRESSED ON THIS ACCOUNT ON BEHALF OF THE LEAR NED AUTHORIZED REPRESENTATIVE. SO, WE ARE NOT INCLINED TO INTERFERE WITH THE FINDING OF CIT(A) WHO HAS CONFIRMED THE OR DER OF ASSESSING OFFICER WHO HAS ADDED THE INCOME OF RS.5, 00,000/- U/S.68 OF THE ACT CLAIMED TO BE SHOWN AS LOAN FROM HIS FATHER SHRI SUGANDHILAL BORA OUT OF AGRICULTURAL INCOME BE CAUSE THE ASSESSEE COULD NOT SUBSTANTIATE ITS CLAIM BY COGENT REASONING. THIS REASONED FINDING OF CIT(A) NEEDS NO INTERFEREN CE FROM OUR SIDE. WE UPHOLD THE SAME. 13.3 IN THE RESULT, THIS APPEAL OF ASSESSEE IS AL SO PARTLY ALLOWED. 14. IN ITA NO.1101/PN/2013 FOR A.Y. 2004-05, THE AS SESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT(A)-I PUNE ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION MADE BY ACIT, WARD 4, AHMEDNAGAR U/S 68 AMOUNTING TO RS.9,20,000/- AS FICTITIOUS CREDIT IN SPITE OF CONFIRMATION OF LOAN FROM SUGANDHILAL BORA (HUF). 2. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT ESTIMATING AGRICULTURAL INCOME OUT OF HUF AGRICULTU RAL INCOME FOR PERIOD 1999-00 TO 2004-05 AS ESTIMATED F OR PERIOD PRIOR TO 1-04-1998 AT RS. 10,000/-PER ACRE. 29 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP 3. THE CIT(A)-I, PUNE ERRED IN LAW AND ON FACTS IN NOT APPRECIATING FACT THAT THE ASSESSEE IS BENEFICIAL O WNER & CULTIVATOR OF HUF AGRICULTURAL LAND SITUATED AT HANUMANTGAON. 4. THE APPELLANT CRAVES LEAVE TO ADD / MODIFY / ALTER / DELETE ALL / ANY OF THE GROUNDS OF APPEAL. 14.1 THE ISSUE OF ESTIMATING AGRICULTURAL INCOME OUT OF HUF AGRICULTURAL INCOME HAS BEEN DECIDED IN ITA NO.1096 /PN/2013 VIDE PARA 5 OF THIS ORDER, WHICH WILL TAKE CARE OF THIS ISSUE. THE ASSESSING OFFICER IS DIRECTED ACCORDINGLY. 14.2 THE ONLY ISSUE REMAINED IS WITH REGARD TO THE ADDITION MADE U/S.68 OF THE ACT AMOUNTING TO RS.9,20,000/-. NOTHING WAS ADDRESSED ON THIS ACCOUNT ON BEHALF OF THE LEAR NED AUTHORIZED REPRESENTATIVE. SO, WE ARE NOT INCLINED TO INTERFERE WITH THE FINDING OF CIT(A) WHO HAS CONFIRMED THE OR DER OF ASSESSING OFFICER WHO HAS ADDED THE INCOME OF RS.9, 20,000/- U/S.68 OF THE ACT CLAIMED TO BE SHOWN AS LOAN FROM HIS FATHER SHRI SUGANDHILAL BORA OUT OF AGRICULTURAL INCOME BE CAUSE THE ASSESSEE COULD NOT SUBSTANTIATE ITS CLAIM BY COGENT REASONING. THIS REASONED FINDING OF CIT(A) NEEDS NO INTERFEREN CE FROM OUR SIDE. WE UPHOLD THE SAME. 15. IN THE RESULT, ALL THE APPEALS FILED BY THE ASS ESSEE ARE DISPOSED OFF AS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT ON THIS THE 24 TH DAY OF SEPTEMBER, 2014. SD/- SD/- (R.K. PANDA) (SHAILENDRA KUMAR YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE, DATED: 24 TH SEPTEMBER, 2014 GCVSR 30 ITA NOS.1096 TO 1101/PN/13 BORA FAMILY GROUP COPY TO:- 1) ASSESSEE 2) DEPARTMENT 3) THE CIT(A)-I, PUNE 4) THE CIT-I, PUNE 5) THE DR, A BENCH, I.T.A.T., PUNE. 6) GUARD FILE BY ORDER //TRUE COPY// ASSISTANT REGISTRAR I.T.A.T., PUNE