ACIT-CIRCLE-6, Nagpur V. SHRI ANKITKUMAR SATYANARAYAN AGRAWAL, Nagpur

ITA 13/NAG/2014

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1689 (ITAT-NAGPUR)
• Duration Of Justice: 1 year(s) 7 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 07-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARENDRA KANE
• Keywords: Business income; Reasonable cause
• Section: 69C

Judgement Text

1 ITA NO. 13/NAG/2014 & CO NO.04/NAG/2014 IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR BEFORE SHRI MUKUL K. SHRAWAT, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER. I.T.A. NO. 13/NAG/2014 ASSESSMENT YEAR : 2008 - 09. ASSTT. COMMISSIONER OF INCOME - TAX, ANKITKUMAR SATYANARAYAN AGRAWAL, CIRCLE - 6, NAGPUR. V/S. GHAT ROAD, NAGPUR - 440 018 PAN AHMPA8384N APPELLANT. RESPONDENT. C.O. NO.04/NAG/2014. (IN ITA NO.13/NAG/2014) ASSESSMENT YEAR : 2 008 - 09. ANKITKUMAR SATYAKUMAR AGRAWAL, ASSTT. COMMISSIONER OF INCOME - TAX, NAGPUR. V/S. CIRCLE - 6, NAGPUR. CROSS OBJECTOR. RESPONDENT. DEPARTMENT BY : SHRI NARENDRA KANE. ASSESSEE BY : SHRI ABHAY AGRAWAL.. DATE OF HEARING : 13 - 07 - 2015 DATE OF PRONOUNCEMENT : 28 TH AUGUST, 2015 O R D E R PER SHAMIM YAHYA, A.M. . THIS APPEAL BY THE REVENUE AND CROSS OBJECTION BY THE ASSESSEE EMANATE OUT OF THE ORDER OF LEARNED CIT(APPEALS) - II, NAGPUR DATED 07 - 10 - 2013 AND PERTAINS TO ASSESSMENT YEAR 2008 - 09. 2 ITA NO. 13/NAG/2014 & CO NO.04/NAG/2014 2. AT THE OUTSE T WE NOTE THAT THERE IS A DELAY IN FILING THE CROSS OBJECTION BY 19 DAYS. THE REASONABLE CAUSE FOR THE DELAY HAS BEEN ATTRIBUTED TO THE ILL HEALTH OF THE ASSESSEES COUNSEL SHRI M. MANI WHILE ULTIMATELY EXPIRED. 3. UPON CAREFUL CONSIDERATION AND HEARING B OTH THE PARTIES, WE CONDONE THE DELAY IN FILING OF THE CROSS OBJECTION. 4. THE GROUND OF APPEAL RAISED IN REVENUES APPEAL READ AS UNDER : WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(APPEALS) HAS ERRED IN DELETING THE ADDITION OF ` .16,86,000/ - AS BUSINESS INCOME ON SALE OF AGRICULTURAL LAND WITHOUT CONSIDERING THE FACTS THAT THE ASSESSEE IS A YOUNG STUDENT AND AGRICULTURAL ACTIVITIES ARE MINIMUM AND CULTIVATION NOT DONE BY THE ASSESSEE. NOTWITHSTANDING THE AGRICULTURAL LAND WAS HELD FOR A PERIOD OF 16 - 17 MONTHS ONLY. 5. THE GROUND RAISED BY THE ASSESSEE IN CROSS OBJECTION IS THAT THE CIT(APPEALS) ERRED IN CONFIRMING THE ADDITION OF ` . 75,000/ - UNDER SECTION 69C. 6. BRIEF FACTS OF THE CASE ARE THAT THE RETURN OF INCOME DECLARING TOTAL INCOME OF ` .42,19,896/ - AND AGRICULTURAL INCOME OF ` .19,21,215/ - WAS FILED ON 21 - 07 - 2008. DURING THE ASSESSMENT PROCEEDINGS IT WAS NOTED BY THE ASSESSING OFFICER THAT THE ASSESSEE HAD SHOWN PROFIT ON SALE ARISING OUT OF SALE OF AGRICULTURAL LAND. THE SAID AGRICULTURAL LAND HAS BEEN PURCHASED BY THE ASSESSEE FOR ` .7,74,000/ - AND SO LD FOR ` .25,00,000/ - . THE ASSESSING OFFICER ASKED THE ASSESSEE TO EXPLAIN AS TO WHY PROFIT ARISING OF SALE OF AGRICULTURAL LAND SHOULD NOT BE TREATED AS BUSINESS INCOME. IT WAS EXPLAINED BY THE ASSESSEE THAT THE RECEIPT ON SALE OF AGRICULTURAL LAND IS AGRICULTURAL INCOME AND EVEN IF SUCH TRANSACTIONS ARE REPEATED FREQUENTLY, THE SURPLUS IS AGRI CULTURAL INCOME AND HENCE EXEMPT. THE ASSESSING OFFICER, HOWEVER, TAKING INTO CONSIDERATION THE HISTORY OF THE ASSESSEE WHEREIN IT WAS SEEN THAT THE ASSESSEE HAD SYSTEMATICALLY CARRIED OUT LARGE NUMBER OF LAND PURCHASE AND SALE TRANSACTIONS, HELD THAT THE PROFIT ARISING ON SALE OF AGRICULTURAL LAND AMOUNTING TO ` .16,86,000/ - 3 ITA NO. 13/NAG/2014 & CO NO.04/NAG/2014 WAS THE BUSINESS INCOME OF THE ASSESSEE. IT WAS FURTHER NOTED BY THE ASSESSING OFFICER THAT THE ASSESSEE SHOWN AGRICULTURAL INCOME AMOUNTING TO ` .2,35,215/ - FOR WHICH THE ASSESSEE HAD SHOWN NO EXPENDITURE . IT WAS NOTED THAT MOST OF THE LAND IS TILED BY BATAIDARS AND HE FURTHER NOTED THAT THE ASSESSEE HAD NOT MAINTAINED ANY DETAILS OF THE PRODUCE, SALE OR EXPENDITURE FOR INDIVIDUAL PIECE OF LAND. 7. CONSIDERING THE ABOVE FACTS, THE ASS ESSING OFFICER HELD THAT THE EXPENDITURE SHOULD BE ESTIMATED AT ` 75,000/ - AND HENCE AO ADDED THE SAME TO THE INCOME OF THE ASSESSEE UNDER SECTION 69C. 8. UPON ASSESSEES APPEAL LEARNED CIT(APPEALS) NOTED THAT IN ASSESSEES OWN CASE, ITAT, NAGPUR BENCH IN ITA NO. 170/NAG/2012 VIDE ORDER DATED 30 - 11 - 2012 HAS DECIDED THE SAME ISSUE IN FAVOR OF THE ASSESSEE. FOLLOWING THE DECISION OF THE ITAT, NAGPUR BENCH IN ASSESSEES OWN CASE, LEARNED CIT(APPEALS) DELETED THE ADDITION OF ` 16,86,000/ - . AGAINST THIS ORDER, REVENUE IS IN APPEAL BEFORE US. 9. AS REGARDS T HE OTHER GROUND REGARDING ADDITION UNDER SECTION 69C OF ` 75,000/ - THE LEARNED CIT(APPEALS) HELD THAT THIS WAS ALSO COVERED BY THE ITAT DECISION IN ASSESSEES OWN CASE AS ABOVE AGAINST THE ASSESEE . ACCORDINGLY HE CONFIRMED THE ADDITION. AGAINST THIS, THE ASSESSEE HAS FILED A CROSS OBJECTION BEFORE US. 10. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. LEARNED COUNSEL OF THE ASSESSEE CONTENDED THAT IT IS UNDISPUTED THAT THE ASSESSEE HAS SOLD AGRICULTURAL LAND. THE SAME WAS BEYOND 8 KMS. OF TH E MUNICIPAL LIMITS. AGRICULTURAL ACTIVITY WAS CONDUCTED ON THE SAME. THIS IS ALSO NOT DENIED BY THE AO . LEARNED C OUNSEL FURTHER PLACED RELIANCE UPON HONBLE JURISDICTIONAL HIGH COURT DECISION IN THE CASE OF CIT V/S. NITISH RAMESHCHANDRA CHORDIA FOR THE PROPOSITION THAT WHERE 4 ITA NO. 13/NAG/2014 & CO NO.04/NAG/2014 AGRICULTURAL LAND SOLD BY THE ASSESSEE WAS SITUATED BEYOND 8 KMS. FROM MUNICIPAL LIM ITS WHEN MEASURED THROUGH ROAD DISTANCE, PROFITS FROM SALE OF SAID LAND WAS NOT TAXABLE. LEARNED COUNSEL FURTHER PLACED REL IANCE ON HONBLE JURISDICTIONAL HIGH COURT DECISION IN THE CASE OF CIT V/S. SMT. DEBBIE ALEMAO FOR THE PROPOSITION THAT WHEN IT WAS A PPARENT FROM RECORD THAT LAND IN QUESTION WAS ENTERED IN REVENUE RECORDS AS AN AGRICULTURAL LAND AND NO PERMISSION WAS EVER OBTAINED FOR NON AGRICULTURAL USE BY THE ASSESSEE AND THE LAND WAS USED FOR THE PURPOSE OF AGRICULTURE, THE SALE PROCEEDS OF SUCH L AND WOULD BE EXEMPT. 11. PER CONTRA LEARNED D.R. RELIED UPON THE ORDERS OF THE ASSESSING OFFICER. 12. UPON CAREFUL CONSIDERATION WE NOTE THAT THE ASSESSEE HAS SOLD THE LAND WHICH HAS BEEN CLASSIFIED AS AGRICULTURAL LAND IN REVENUE RECORDS. THE ASSESSEE IS DOING AGRICULTURAL ACTIVITY ON THE SAME AND THIS IS NOT AT ALL DENIED BY THE REVENUE. AS A MATTER OF FACT THE ASSESSING OFFICER HAS IN FACT OBSERVED THAT THE ASSESSEE HAS SHOWN AGRICULTURAL INCOME OF ` .2,35,215/ - , THE ASSESSEE OWNS SUBSTANTIAL LAND, MOST OF THE LAND IS TILED BY OTHERS I.E. BATAIDARS (SHARE CROPPERS). THE ASSESSING OFFICER HAS PROCEEDED TO MAKE AN ESTIMATED ADDITION OF AGRICULTURAL EXPENSES AMOUNTING TO ` .75,000/ - AND ADDED THE SAME UNDE R SECTION 69C OF THE I.T. ACT. THUS WHEN THE REVENUE IS NOT AT ALL DENYING THAT AGRICULTURAL ACTIVITY IS DONE ON THE SAID LAND AND IDENTICAL ISSUE HAS BEEN CONSIDERED BY THE TRIBUNAL IN ASSESSEES OWN CASE IN EARLIER YEARS AND DECIDED IN FAVOUR OF THE ASS ESSEE, WE DO NOT SEE ANY REASON NOT TO CONCUR WITH THE FINDING OF THE LEARNED CIT(APPEALS). UNDER THESE CIRCUMSTANCES, RESPECTFULLY FOLLOWING THE PRECEDENT AS ABOVE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LEARNED CIT(APPEALS). ACCORDINGLY WE AFFIRM THE SAME. 5 ITA NO. 13/NAG/2014 & CO NO.04/NAG/2014 13. ASSESSEES CROSS OBJECTION: WE FIND THAT THE ASSESSING OFFICER HAS OBSERVED THAT THE ASSESSEE HAS SHOWN AN INCOME OF ` .2,35,215/ - AS AGRICULTURAL INCOME. THE ASSESSEE HAS NOT SHOWN ANY EXPENSE INCURRED IN THIS REGARD. THE ASSESSING OFFICER HAS PROCEEDED TO MAKE AN ESTIMATE OF ` .75,000/ - A S UNDISCLOSED EXPENDITURE ON AGRICULTURE AND HAS ADDED THE SAME UNDER SECTION 69C OF THE I.T. ACT. LEARNED CIT(APPEALS) HAS FOUND THAT SIMILAR ADDITION WAS CONFIRMED BY ITAT, NAGPUR BENCH IN ASSESSEES OWN CASE IN EARLIER YEAR. IN TH ESE CIRCUMSTANCES , AFTER HEARING BOTH THE COUNSEL AND PERUSING THE RECORDS IN OUR CONSIDERED OPINION, LEARNED CIT(APPEALS) IS CORRECT IN CONFIRMING THE ADDITION IN THIS REGARD. ACCORDINGLY WE AFFIRM THE ORDER OF LEARNED CIT(APPEALS). HENCE THE CROSS OBJECTION OF THE ASSESSEE STANDS DISMISSED. 14. IN THE RESULT, THE APPEAL FILED BY THE REVENUE AS WELL AS THE CROSS OBJECTION BY THE ASSESSEE STAND DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF AUGUST, 2015. SD/ - S D/ - (MUKUL K. SHRAWAT) ( SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER. NAGPUR, DA TED: 28 TH AUGUST, 2015. COPY OF ORDER FORWARDED TO : 6 ITA NO. 13/NAG/2014 & CO NO.04/NAG/2014 1. THE ASSESSEE. 2. REVENUE. 3. THE CIT(A) 4. THE CIT, NAGPUR. 5. THE D.R., ITAT, NAGPUR. 6. GUARD FILE. TRUE COPY. BY ORDER WAKODE ASSISTANT REGISTRAR, ITAT, NAGPUR