Shri Pradhyumansinghji J. Padhiyar (HUF), Anand V. The Income Tax Officer, Ward-1(3)(2), Petlad

ITA 1374/AHD/2017

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 7238 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-06-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 05-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V.K. SINGH
• Keywords: Opportunity of being heard; Principle of natural justice; TDS
• Section: 143(3)

Judgement Text

ITA No.1374/Ahd/2017 Assessment Year: 2012-13 Page 1 of 5 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “C” BENCH, AHMEDABAD BEFORE Ms. SUCHITRA KAMBLE, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA No.1374/Ahd/2017 Assessment Year: 2012-13 Pradhyumansinghji J Padhiyar (HUF), vs. Income Tax Officer, Darbar Gadh, Ward – 1(3)(2), Petlad. At Post-Umeta, Ta – Anklav, Dist. Anand – 388 510. [PAN – AAKHP 2872 F] (Appellant) (Respondent) Appellant by : Shri Chirag Shah, A.R. Respondent by : Shri V.K. Singh, Sr. D.R. Date of hearing : 26.05.2022 Date of pronouncement : 15.06.2022 O R D E R PER SUCHITRA KAMBLE, JUDICIAL MEMBER : This is an appeal filed by the assessee against the order dated 20.03.2017 passed by the CIT(A)-4, Vadodara pertaining to A.Y. 2012-13. 2. The grounds of appeal are as under: “1. The Assessment order passed u/s.143(3) of IT Act by the Assessing Officer and fully dismissed by the first appellate authority is bad in law and deserved to be uncalled for. 2. The Assessing Officer as well as first appellate authority has erred in law and on facts in making the addition and confirming respectively of Rs.18,50,000/- on account of unexplained introduction of capital. The same deserves to be deleted. 3. The Assessing Officer as well as first appellate authority has erred in law and on facts in making the addition and confirming respectively of Rs.37,50,000/- on account of treating agriculture income as non agriculture income. The same deserves to be deleted.” ITA No.1374/Ahd/2017 Assessment Year: 2012-13 Page 2 of 5 3. The assessee is an individual derives income from agricultural and other sources. The assessee filed return of income on 27.09.2012 declaring total income at Rs.42,51,340/-. The assessment order under Section 143(3) of the Income Tax Act, 1961 finalised on 25.03.2015 determining total income of Rs.61,29,338/-. The Assessing Officer made addition of Rs.18,50,000/- on account of unexplained introduction of capital and addition of Rs.37,50,000/- on account of treating agricultural income as non-agricultural income. 4. Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee. 5. The Ld. AR submitted that addition on account of unexplained capital introduction which is ground no.1 & 2 of the present appeal should be remitted back to the file of the Assessing Officer as the opening balance as on 31.03.2011 was not rightly taken into account by the Assessing Officer. 6. The Ld. DR relied upon the assessment order and the order of the CIT(A). 7. We have heard both the parties and perused all the material available on record. It is pertinent to note that the Balance Sheet as on 31.03.2011 and 31.03.2012 were reproduced by the CIT(A) in the order as under :- BALANCE SHEET FOR A.Y. 2011-12 AND 2012-13 As on 31.03.2011 As on 31.03.2012 Liability Assets As on 31.03.2011 As on 31.03.2012 2564030 8535371 CAPITAL EQUIPMENT PURCHASE 37737 32076 245000 245000 LOAN PAYABALE BABNK OF BARODA 54750 81410 CURRENT LIABILITY LOAN GIVEN TO ANIRUDH 1150000 2450000 6000 11000 NISHA INSTITUTE ORIENTAL BANK FD 600000 0 3000 4500 MABNUBHAIA C SHAH BORSAD INTEREST RECEIVABLE 137949 59540 ITA No.1374/Ahd/2017 Assessment Year: 2012-13 Page 3 of 5 7000 ALLARAKHA BAJIBHAI BANK OF BARODA FD 700000 700000 7000 VIJENDRA ARYA CASH ON HAND 137594 17966 TDS 5978 LOAN GIVEN TO 5462901 8. But the same does not tally from the actual opening balance as on 01.04.2011 i.e. Rs.44,14,030.05. In fact the figure of closing balance as on 31.03.2011 was shown as Rs.25,64,030/- which is not in consonance with the actual details filed by the assessee before the Assessing Officer as well as before the CIT(A). Therefore, this needs verification and we direct the Assessing Officer to verify the same. The matter is remitted back to the file of the Assessing Officer for proper adjudication of this issue after verifying the details filed by the assessee. Needful to say the assessee be given opportunity of being heard by following the principles of natural justice. Thus, ground no.1 & 2 are partly allowed for statistical purpose. 9. As regards the addition on account of income from agriculture, the Ld. AR submitted that the Assessing Officer has not properly adjudicated this ground and given an incorrect observation that the said land is useless land for cultivation. 10. The Ld. AR submitted the report of the Talati/Statement of Talati that it is non- cultivation land was not at all cross-examined. In fact, the assessee is having more than 1000 acres of agricultural land and portion of land at the bank of Mahi is cultivable land from which assessee was drawing agricultural income though the revenue record shows that the same is sandy and stony land. Ld AR submitted that the portion of land i.e. Vanta land wherein survey no 410 and 555 are not cultivable land but the land appearing in survey no 415/Paiki which is the major portion and is total agricultural. Ld. AR relied upon the decision of Hon’ble Gujarat High Court in case of CIT vs. Sarifabibi Mohamed Ibrahim, 136 ITR 621 wherein it is held that the land is entered as agricultural land in revenue records and is assessed as such under the land revenue side, would a circumstance in favour of conclusion that it is an agricultural land. Ld. AR also relied upon the decision of Apex Court in CWT vs. ITA No.1374/Ahd/2017 Assessment Year: 2012-13 Page 4 of 5 Officer-in-charge, 105 ITR 133 wherein it is held that the classification in the revenue records is not conclusive and there was absolutely no evidence of any dry crops having been raised in these land and in absence of any such crop having been raised, the classification in the revenue register would also have no evidentiary value. Thus, the Ld. AR submitted that the Assessing Officer as well as the CIT(A) erred in making the addition of Rs.37,50,000/- treating agricultural income as non-agricultural income. 11. The Ld. DR relied upon the assessment order and the order of the CIT(A). 12. We have heard both the patties and perused all the relevant material available record. It is pertinent to note that the statement of Talati saying that the land is non- agricultural is contrary to the land revenue records wherein it is submitted that the portion of the land is cultivable land as well. The statement of Talati was never cross- examined. In fact, the record before us which was produced at the time of assessment order and before the CIT(A) reveals that there is a portion of agricultural land and there are agricultural activity going on which means that the assessee is deriving income from agriculture. These facts also need to be verified. The Assessing Officer has simply relied upon the quantum has made addition. Therefore, we remit back this issue to the file of Assessing Officer for proper adjudication and verification of the land and its use in the assessment before us. The issue is remitted back to the Assessing Officer for proper adjudication as per law. Needless to say that the assessee be given opportunity of hearing by following the principles of natural justice. Ground no.3 is partly allowed for statistical purpose. 13. In the result, appeal of the assessee is partly allowed for statistical purposes. Order pronounced in the open Court on this 15 th day of June, 2022. Sd/- Sd/- (WASEEM AHMED) (SUCHITRA KAMBLE) Accountant Member Judicial Member Ahmedabad, the 15 th day of June, 2022 PBN/* ITA No.1374/Ahd/2017 Assessment Year: 2012-13 Page 5 of 5 Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Assistant Registrar Income Tax Appellate Tribunal Ahmedabad benches, Ahmedabad