Charan Singh, Sonipat V. ITO WARD - 1, Sonipat

ITA 1148/DEL/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 4809 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 18-05-2020
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Section: 142(1); 147; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC, NEW DELHI BEFORE SH. ANIL CHATURVEDI, ACCOUNTANT MEMBER (THROUGH VIDEO CONFERENCING) ITA NO.1148/DEL/2020 (ASSESSMENT YEAR : 2011-12) CHARAN SINGH VPO FAZILPUR DISTRICT, SONIPAT, HARYANA-131 001 PAN : BGGPS 3426 P VS. ITO WARD 1 SONIPAT (APPELLANT) (RESPONDENT) A SSESSEE BY SHRI AKSHAT SHARMA. ADVOCATE RE VENUE BY SHRI R. K. GUPTA, SR. D.R. DATE OF HEARING: 2 3 .0 9 .2021 DATE OF PRONOUNCEMENT: 30 .0 9 .2021 ORDER PER ANIL CHATURVEDI, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 27.01.2020 OF THE COMMISSIONER OF INCOME TAX (APPEALS)-ROHTAK RELATING TO ASSESSMENT YEAR 2011-12. 2. THE RELEVANT FACTS AS CULLED FROM THE MATERIAL ON RECORDS ARE AS UNDER : 3. ASSESSEE IS AN INDIVIDUAL. AO HAS NOTED THAT ON THE BASIS OF INFORMATION AVAILABLE WITH THE DEPARTMENT, IT WAS NOTICED THAT 2 ASSESSEE HAS DEPOSITED CASH AGGREGATING TO RS.15,90,000/- DURING THE F.Y. 2010-11 RELEVANT TO A.Y. 2011-12 IN HIS BANK ACCOUNT. THE AO WAS THUS OF PRIMA FACIE VIEW THAT THE DEPOSITS WERE FROM ASSESSEES UNDISCLOSED SOURCES. AO THEREFORE ISSUED NOTICE U/S 148 OF THE ACT ON 28.03.2018 WHICH WAS DULY SERVED UPON THE ASSESSEE ASKING THE ASSESSEE TO FILE THE RETURN OF INCOME. AO HAS NOTED THAT NOTICE U/S 142(1) OF THE ACT WAS ISSUED TO THE ASSESSEE FROM TIME TO TIME BUT THERE WAS NO APPEARANCE FROM THE ASSESSEES SIDE NOR ANY EXPLANATION WAS PROVIDED ABOUT THE SOURCE OF CASH DEPOSITS. AO THEREFORE TREATED THE AGGREGATE CASH DEPOSITS OF RS.15,90,000/- IN HIS ACCOUNT WITH PUNJAB NATIONAL BANK AS UNEXPLAINED AND TREATED IT AS INCOME FROM UNDISCLOSED SOURCE. THUS IN THE ASSESSMENT ORDER FRAMED U/S 144 R.W.S 147 OF THE ACT ON 13.12.2018 AO DETERMINED THE TOTAL TAXABLE INCOME OF THE ASSESSEE AT RS.15,90,000/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A), WHO VIDE ORDER DATED 27.01.2020 IN APPEAL NO.472/2018-19 GRANTED PARTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF CIT(A), ASSESSEE IS NOW IN APPEAL AND HAS RAISED THE FOLLOWING GROUNDS: 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ROHTAK HAS ERRED ON FACTS AND IN LAW IN REJECTING THE CONTENTION OF THE ASSESSEE THAT THE ORDER PASSED BY THE LEARNED A.O U/S 144 IS BAD IN LAW AND LIABLE TO BE QUASHED AS THE ASSESSMENT WAS DONE WITHOUT THE PROPER SERVICE OF NOTICE U/S 148 TO THE ASSESSEE. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ROHTAK HAS ERRED IN FACTS AND IN LAW IN CONFIRMING THE ADDITION TO THE EXTENT OF RS.570000/- ON THE BASIS OF CASH DEPOSIT WITHOUT CONSIDERING THE CONTENTION AND SUPPORTIVE DOCUMENTS IN THIS REGARD PRODUCED BY THE 3 APPELLANT. HENCE, THE ADDITION MAY KINDLY BE DELETED 3. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ROHTAK HAS ERRED ON FACTS AND IN LAW, IN MAKING THE ADDITION OF RS. 100000/- IGNORING THE SOURCES OF HOUSEHOLD EXPENSES. NO SUCH ADDITION WAS MADE BY THE A.O. HENCE ADDITION MAY KINDLY BE DELETED. 4. THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR WITHDRAW ANY OR ALL THE ABOVE GROUNDS OF APPEAL. 4. BEFORE ME, LEARNED AR SUBMITTED THAT HE DOES NOT WANT TO PRESS GROUND NO.1. IN VIEW OF THE AFORESAID SUBMISSIONS OF THE LEARNED AR, GROUND NO.1 IS DISMISSED AS NOT PRESSED. 5. GROUND NO.2 IS WITH RESPECT TO ADDITION OF RS.5,70,000/-. 6. LEARNED AR SUBMITTED THAT ASSESSEE IS A FARMER AND DOING AGRICULTURAL ACTIVITIES ON THE ANCESTRAL AGRICULTURE LAND SITUATED IN VILLAGE SULTANAPUR DISTRICT SONIPAT MEASURING 6 ACRES. HE SUBMITTED THAT THEIR ANCESTRAL AGRICULTURAL LAND IN VILLAGE FAZILPUR WAS ACQUIRED BY THE HARYANA GOVERNMENT IN THE YEAR 1995 AND COMPENSATION WAS AWARDED. THE ASSESSEE WITH HIS BROTHER SHRI PRATAP SINGH FROM THE COMPENSATION RECEIVED HAD PURCHASED AGRICULTURE LAND HAVING AREA OF 14.340 HECTARE (35.85 ACRES) IN CHHATTISGARH OF WHICH ASSESSEES PORTION OF LAND BEING 17.40 ACRES AND 18.45 ACRE BEING OF HIS BROTHER PRATAP SINGH. ON THE LAND CASH CROPS LIKE SOYBEAN, SUGARCANE, GRAM ARE GROWN AND IN SUPPORT OF HIS CONTENTION HE POINTED TO THE COPY OF JAMABANDI PLACED IN PAPER BOOK. HE SUBMITTED THAT HIS BROTHER PRATAP SINGH STAYS IN BEMITRA CHHATTISGARH AND SINCE ASSESSEE WAS LIVING IN HIS ANCESTRAL VILLAGE AT FAZILPUR, HE HAD LEASED OUT 4 PORTION OF AGRICULTURE LAND OF 17.40 ACRES TO HIS BROTHER SHRI PRATAP SINGH RANA FOR RS.5,70,000/- P.A. THE AMOUNT OF RENT WAS RECEIVED FROM HIS BROTHER IN CASH AND IT WAS DEPOSITED IN THE BANK ACCOUNT. ASSESSEE ALSO FURNISHED AFFIDAVIT OF HIS BROTHER SHRI PRATAP SINGH WHEREIN HE HAD CONFIRMED THE GIVING OF LEASE RENT OF RS.5,70,000/- TO THE ASSESSEE ON 14.12.2010 WHICH WAS OUT OF HIS AGRICULTURAL INCOME. HE SUBMITTED THAT SINCE THE AGREEMENT TO LEASE THE AGRICULTURAL LAND WAS WITH HIS BROTHER, NO FORMAL AGREEMENT IN WRITING WAS ENTERED BY THE ASSESSEE AND IT WAS VERBALLY AGREED BETWEEN THE BROTHERS ABOUT THE LEASE OF LAND AND THE RENT FOR THE SAME. HE FURTHER SUBMITTED THAT THE DEPOSITS IN BANK WERE ALSO OUT OF THE CASH WITHDRAWALS MADE EARLIER AND SINCE THE AGRICULTURE WAS THE SOLE SOURCE, THE SOURCE OF DEPOSITS WAS OUT OF THE AGRICULTURE ACTIVITIES. HE SUBMITTED THAT THE EXPLANATIONS FURNISHED BY THE ASSESSEE WAS NOT FOUND ACCEPTABLE BY THE AUTHORITIES MAINLY FOR THE REASON THAT THE MONEY FROM HIS BROTHER WAS RECEIVED IN CASH AND THERE WAS NO WRITTEN AGREEMENT FOR THE LEASE DEED. LEARNED ASSESSEE POINTED TO THE SUBMISSIONS MADE BY THE ASSESSEE BEFORE THE CIT(A), THE SUBMISSIONS TO THE REMAND REPORT WHICH ARE INCORPORATED IN THE ORDER OF CIT(A). HE ALSO POINTED TO THE COPY OF THE AFFIDAVIT OF HIS BROTHER. HE THEREFORE SUBMITTED THAT CONSIDERING THE FACT THAT THE DEPOSITS ARE OUT OF THE AGRICULTURAL ACTIVITIES OF HIS BROTHER AND WHICH IS ALSO CONFIRMED BY THE BROTHER, NO ADDITION IS CALLED FOR. HE THEREFORE SUBMITTED THAT THE ADDITION MADE BY THE AO BE DELETED. 7. LEARNED DR ON THE OTHER HAND SUPPORTED THE ORDER OF LOWER AUTHORITIES. 5 8. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ISSUE IN THE PRESENT GROUND IS WITH RESPECT TO THE ADDITION OF RS.5,70,000/- BEING CASH DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE. BEFORE ME AND BEFORE THE LOWER AUTHORITIES, IT IS THE ASSESSEES SUBMISSIONS THAT ASSESSEE HAD GIVEN HIS PORTION OF LAND OF 17.40 ACRES OF CULTIVABLE LAND ON WHICH CASH CROPS ARE GROWN TO HIS BROTHER FOR CULTIVATION AT AN ANNUAL LEASE OF RS.5,70,000/-. THE SUBMISSION OF THE ASSESSEE OF THE AGRICULTURAL ON WHICH CASH CROPS ARE GROWN HAS NOT BEEN DISPUTED BY THE REVENUE. THE REASON FOR NOT ACCEPTING THE LEASE RENT WAS THE ABSENCE OF LEGAL AGREEMENT BETWEEN THE ASSESSEE AND HIS BROTHER. THE FACT THAT THE LAND BEING PURCHASED AT CHHATTISGARH BY THE ASSESSEE ALONG WITH HIS BROTHER PRATAP SINGH WHO IS STAYING AT CHHATTISGARH AND CULTIVATING HIS PORTION OF LAND AND ALSO TAKEN OVER THE LAND OF THE ASSESSEE ON LEASE HAS NOT BEEN CONTROVERTED BY THE REVENUE. THE CONTENTION OF THE ASSESSEE THAT THE AGREEMENT FOR LEASE OF LAND BEING AN ORAL AGREEMENT SIMPLY CANNOT BE BRUSHED ASIDE IN VIEW OF THE FACT THAT THE LEASE OF LAND IS TO THE REAL BROTHER OF THE ASSESSEE WHO IS ALSO AN AGRICULTURISTS AND THE CONFIRMATION OF BROTHER OF HAVING TAKEN THE LAND ON LEASE FROM ASSESSEE AND THE PAYMENT OF LEASE IN CASH. IN SUCH A SITUATION, THE AGREEMENT IN THE FORM OF ORAL UNDERSTANDING BETWEEN THE BLOOD RELATIONS CANNOT BE DISCARDED WITHOUT THERE BEING ANY EVIDENCE TO THE CONTRARY. THE CONTENTS OF THE AFFIDAVIT OF THE BROTHER OF THE ASSESSEE HAS NOT BEEN FOUND TO BE FALSE BY THE REVENUE. CONSIDERING THE TOTALITY OF THE AFORESAID FACTS, I AM OF THE VIEW THAT THE SUBMISSIONS OF THE ASSESSEE ABOUT 6 THE SOURCE OF CASH CANNOT BE BRUSHED ASIDE WITHOUT THERE BEING ANY EVIDENCE TO THE CONTRARY. CONSIDERING THE TOTALITY OF THE FACTS, I HOLD THE SOURCE OF CASH DEPOSITS TO BE EXPLAINED. THEREFORE, I DIRECT THE AO TO DELETE THE ADDITION. THUS THE GROUND OF THE ASSESSEE IS ALLOWED. 9. GROUND NO.3 IS WITH RESPECT TO THE ADDITION OF RS.1,00,000/-. 10. DURING THE COURSE OF REMAND PROCEEDINGS, AO ASKED THE ASSESSEE TO GIVE THE COMPLETE DETAILS OF THE FAMILY MEMBER AND MONTH WISE DETAILS OF HOUSEHOLD EXPENSES WITH THE SOURCE FROM WHICH IT HAS BEEN MET TO WHICH ASSESSEE INTER ALIA SUBMITTED THAT HE LIVES IN HIS VILLAGE, ALONG WITH HIS FAMILY COMPRISING OF HIMSELF, HIS WIFE AND TWO MINOR KIDS. IT WAS ALSO SUBMITTED THAT THE AGRICULTURE PRODUCE AND VEGETABLES GROWN IN HIS FARM OF 6 ACRES ARE USED BY THE ASSESSEE AND THEREFORE NO EXPENSES ARE INCURRED FOR ITS PURCHASE. IT WAS FURTHER SUBMITTED THAT RS.1,00,000/- WAS WITHDRAWN FROM HOUSEHOLD EXPENSES. AO NOTED THAT THE MONTH WISE DETAILS OF HOUSEHOLD EXPENSES WAS NOT PROVIDED BY THE ASSESSEE. HE WAS OF THE VIEW THAT RS.1,00,000/- FOR HOUSEHOLD EXPENSES WAS NOT SUFFICIENT FOR A FAMILY OF FOUR PERSONS. HE THEREAFTER ESTIMATED THE HOUSEHOLD EXPENSES OF THE ASSESSEE AT RS.25,000/- PER MONTH. WHEN THE MATTER WAS CARRIED BEFORE THE CIT(A), CIT(A) UPHELD THE ORDER OF AO. AGGRIEVED BY THE ORDER OF CIT(A), ASSESSEE IS NOW IN APPEAL. 7 11. BEFORE ME, LEARNED AR SUBMITTED THAT ASSESSEE LIVES IN THE VILLAGE WITH HIS WIFE AND TWO MINOR KIDS WHO WERE NOT SCHOOL GOING DURING THE RELEVANT PERIOD. HE SUBMITTED THAT THE AGRICULTURE PRODUCE OF FOOD GRAINS, VEGETABLES GROWN ON 6 ACRES AND MILK AVAILABLE FROM THE CATTLE OWNED BY THE ASSESSEE WAS SUFFICIENT TO TAKE CARE OF BASIC NEEDS THAT IN SUCH A SITUATION THE EXPENSE OF RS.1,00,000/- SHOWN BY THE ASSESSEE FOR MEETING OTHER HOUSEHOLD EXPENSES WAS SUFFICIENT. HE THEREFORE SUBMITTED THAT ESTIMATE OF HOUSEHOLD EXPENSES MADE BY THE AO AND UPHELD BY CIT(A) BE DELETED. 12. LEARNED DR ON THE OTHER HAND SUPPORTED THE ORDER OF AO. 13. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ISSUE IN THE PRESENT GROUND IS WITH RESPECT TO ESTIMATION OF HOUSEHOLD EXPENSES. AS AGAINST THE EXPENDITURE OF RS.1,00,000/- SHOWN BY THE ASSESSEE TOWARDS HOUSEHOLD EXPENSES, IT IS THE CONTENTION OF THE REVENUE THAT THE HOUSE HOLD EXPENSES SHOULD BE RS.25,000/- PER MONTH. BEFORE ME, LEARNED AR HAS SUBMITTED THAT DURING THE RELEVANT PERIOD ASSESSEE WAS STAYING IN A VILLAGE WITH HIS WIFE AND TWO MINOR SONS WHO WERE NOT SCHOOL GOING AND THE MILK AND GRAINS WHICH ARE AVAILABLE FROM HIS OWN FARM AND CATTLE WAS SUFFICIENT TO MEET HIS BASIC DAILY REQUIREMENTS. THE AFORESAID CONTENTIONS OF THE LEARNED AR HAS NOT BEEN CONTROVERTED BY REVENUE BY PLACING ANY CONTRARY EVIDENCE ON RECORD. CONSIDERING THE TOTALITY OF THE AFORESAID FACTS, I AM OF THE VIEW THAT THE EXPENDITURE OF RS.1,00,000/- TOWARDS HOUSEHOLD EXPENSES SHOWN BY THE 8 ASSESSEE CANNOT BE DISCARDED WITHOUT ANY EVIDENCE TO THE CONTRARY. I THEREFORE HOLD THAT THE AO WAS NOT JUSTIFIED IN ESTIMATING THE HOUSEHOLD EXPENSES AS RS.25,000/- PER MONTH. I THEREFORE DIRECT THE ESTIMATION MADE BY THE AO TO BE DELETED. THUS THE GROUND OF ASSESSEE IS ALLOWED. 14. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 30.09.2021 SD/- (ANIL CHATURVEDI) ACCOUNTANT MEMBER DATE:- 30.09.2021 PY* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI