ACIT 22(3), NAVI MUMBAI V. MILIND V.DESHMUKH, NAVI MUMBAI

ITA 1831/MUM/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8293 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-12-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 10-12-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 07-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK BATRA
• Assessee Lawyers: C N VAZE
• Section: 69C; 131

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BE NCH, MUMBAI , !' $ $ $ $ % & ' , !' ( BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER ./I .T.A. NO. 1831/MUM/2013 ( ) ) ) ) / ASSESSMENT YEAR : 2009-10 THE ACIT 22(3), VASHI RAILWAY STATION COMPLEX, VASHI, NAVI MUMBAI / VS. SHRI MILIND V DESHMUKH, PLOT NO. R-478, ITC INDL. AREA, MIDC RABALE, NAVI MUMBAI-400 701 '* ./ +, ./ PAN/GIR NO. : AEWPD 2450D ( *- / APPELLANT ) .. ( ./*- / RESPONDENT ) *- 0 / APPELLANT BY: SHRI VIVEK BATRA ./*- 1 0 / RESPONDENT BY: SHRI C.N. VAZE 1 %2 / DATE OF HEARING :10.12.2014 34) 1 %2 / DATE OF PRONOUNCEMENT :10.12.2014 !& / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE REVENUE IS PREFERRED AGAINST TH E ORDER OF THE LD. CIT(A)-33, MUMBAI DT.20.12.2012 PERTAINING TO A .Y.2009-10. 2. THE SOLE GRIEVANCE OF THE REVENUE READS AS UNDER : ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT AGRICULTU RAL INCOME OF RS. 74,18,377/- BE TAKEN AT RS. 30,70,938 /- AND ALLOWING LABOUR EXPENSES AT 40% OF TURNOVER AT RS. ITA NO. 1831/M/2013 2 28,87,350/-. THE GENUINITY OF AGRICULTURAL INCOME ITSELF WAS NOT ESTABLISHED AND ANY EXPENSE INCURRED MUST BE TR EATED AS UNDISCLOSED EXPENDITURE U/S. 69C OF THE I.T. ACT AN D ENHANCE THE INCOME OF THE ASSESSEE. 3. THE ASSESSEE FILED THE RETURN OF INCOME FOR THE YEAR 2009-10 ON 30 TH SEPTEMBER, 2009 DECLARING TOTAL INCOME OF RS. 87,71 ,315/- WHICH INCLUDED AGRICULTURAL INCOME OF RS. 50,96,003/-. T HE RETURN WAS SELECTED FOR SCRUTINY ASSESSMENT. ON EXAMINATION OF COMPUT ATION OF INCOME, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS SH OWN GROSS RECEIPTS FROM AGRICULTURAL ACTIVITY OF RS. 74,18,377/- AND A FTER CLAIMING EXPENSES OF RS. 23,22,374/-, NET AMOUNT OF RS. 50,96,003 IS OFFERED AS INCOME FROM AGRICULTURAL ACTIVITY. THE AO ASKED THE ASSESSEE T O FILE COMPLETE DETAILS IN RESPECT OF HIS AGRICULTURAL INCOME. ON VERIFIC ATION OF THE DETAILS FILED BY THE ASSESSEE, THE AO NOTICED THAT THE ASSESSEE I S DOING AGRICULTURAL ACTIVITIES OF 97.39 HECTARES OF LAND. THE AO FURTH ER FOUND THAT THE ASSESSEE IS OWNING ONLY 10 HECTARES OF LAND AND TH E REST WAS TAKEN ON LEASE FROM VARIOUS PERSONS. ON FINDING THAT THE AG RICULTURAL LANDS WERE SITUATED AT AMRAVTI. THE AO ASKED THE ITO WARD-1, AMRAVATI TO MAKE NECESSARY ENQUIRIES U/S. 131 OF THE ACT. 3.1. THE ITO AMRAVATI CONDUCTED ENQUIRIES AND SUBMI TTED THE REPORT TO THE AO. AFTER CONSIDERING THE FACTS AND THE SUBMIS SIONS AND THE REPORT SUBMITTED BY THE ITO AMRAVATI, THE AO COMPUTED THE AGRICULTURAL INCOME ONLY IN RESPECT OF THE LAND OWNED BY THE ASS ESSEE. THE AGRICULTURAL INCOME WAS WORKED OUT TO RS. 3,92,445/ -. THE AO TREATED THE BALANCE AMOUNT OF RS. 47,03,558/- AS INCOME FRO M UNDISCLOSED SOURCES. 4. AGGRIEVED BY THIS, THE ASSESSEE CARRIED THE MATT ER BEFORE THE LD. CIT(A). IT WAS CLAIMED BEFORE THE LD. CIT(A) THAT THE ASSESSEE HAD FURNISHED SALE BILLS BEFORE THE AO WHICH HAVE NOT B EEN DOUBTED BY THE ITA NO. 1831/M/2013 3 AO. IT WAS POINTED OUT TO THE LD. CIT(A) THAT AFTE R MAKING ROVING ENQUIRIES, ITO AMRAVATI HAS NOT GIVEN ANY ADVERSE R EPORT TO THE AO. IT WAS CLAIMED THAT THE AGRICULTURAL INCOME SHOWN BY T HE ASSESSEE SHOULD BE ACCEPTED. 4.1. AFTER CONSIDERING THE FACTS AND THE SUBMISSION S MADE BY THE ASSESSEE, THE LD. CIT(A) WAS CONVINCED THAT THE SAL E BILLS ARE NOT DISPUTED DESPITE CONDUCTING AN ENQUIRY FOR THE SA ME. HOWEVER, THE LD. CIT(A) FOUND THAT THE LABOUR EXPENSES SHOWN BY THE ASSESSEE ARE RIDICULOUSLY LOW BEING 6.85% ONLY. THE LD. CIT(A) WAS OF THE OPINION THAT A REASONABLE ESTIMATE OF THE LABOUR EXPENSES H AVE TO BE MADE. THE LD. CIT(A) ESTIMATED THE EXPENDITURE @ 40% OF THE TURNOVER SHOWN BY THE ASSESSEE AND ACCORDINGLY RESTRICTED THE CLAIM O F AGRICULTURAL INCOME AT RS. 30,70,938/-. 5. AGGRIEVED BY THIS, THE REVENUE IS BEFORE US. 6. THE LD. DEPARTMENTAL REPRESENTATIVE STRONGLY REL IED UPON THE ASSESSMENT ORDER. 7. THE LD. COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN SUBMITTED BEFORE THE LD. CIT(A). 8. HAVING HEARD THE RIVAL SUBMISSIONS, WE HAVE CARE FULLY PERUSED THE ORDER OF THE AUTHORITIES BELOW. IT IS AN UNDISPUTE D FACT THAT THERE IS NO ADVERSE FINDING SO FAR AS SALE BILLS OF THE ASSESSE E ARE CONCERNED. IT IS ALSO AN UNDISPUTED FACT THAT ON DETAILED ENQUIRIES MADE BY THE ITO, AMARAVATI, NO ADVERSE FINDING HAS BEEN GIVEN. IT I S ALSO AN UNDISPUTED FACT THAT THE LABOUR EXPENSES CLAIMED BY THE ASSES SEE ARE RIDICULOUSLY LOW. THEREFORE, THE LD. CIT(A) WAS LEFT WITH NO OP TION BUT TO ESTIMATE ITA NO. 1831/M/2013 4 THE EXPENDITURE INCURRED ON LABOUR ACTIVITIES WHICH HE HAS TAKEN AT 40%. THE ASSESSEE IS NOT IN APPEAL BEFORE US WHICH MEANS THAT THE ASSESSEE HAS ACCEPTED THE ESTIMATE MADE BY THE LD. CIT(A). 9. AFTER CONSIDERING THE ENTIRE FACTS IN TOTALITY, WE FIND THAT THE ESTIMATE OF 40% OF LABOUR EXPENSE IS FAIR AND REASO NABLE AND THEREFORE NO INTERFERENCE IS CALLED FOR. 10. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH DECEMBER, 2014 SD/- SD/- (AMIT SHUKLA ) (N.K. BILLAIYA) !' /JUDICIAL MEMBER !' / ACCOUNTANT MEMBER MUMBAI; 5! DATED : 10 TH DECEMBER, 2014 . . ./ RJ , SR. PS !& !& !& !& 1 11 1 .% .% .% .% 6)% 6)% 6)% 6)% / COPY OF THE ORDER FORWARDED TO : 1. *- / THE APPELLANT 2. ./*- / THE RESPONDENT. 3. 7 ( ) / THE CIT(A)- 4. 7 / CIT 5. 89 .% , , / DR, ITAT, MUMBAI 6. 9: ; / GUARD FILE. !& !& !& !& / BY ORDER, /% .% //TRUE COPY// < << < / = = = = + + + + (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI