ITO, Jaipur V. HAR DEVI ASNANI, Jaipur

ITA 226/JPR/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 2117 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 04-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: MANISH AGARWAL CA DHK
• Keywords: Earning of tax free income

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH DQY HKKJR] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS [KK LNL; DS LE{K BEFORE: SHRI KUL BHARAT, JM & SHRI VIKRAM SINGH YAD AV, AM VK;DJ VIHY LA-@ ITA NO. 226/JP/2015 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12. THE INCOME - TAX OFFICER, WARD 3(1), JAIPUR. CUKE VS. SMT. HAR DEVI ASNANI, 8A, SHIVRAJ NIKETAN, VAISHALI NAGAR, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. ABMPA 7275 Q VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI R.A. VERMA (ADDL.CIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI MANISH AGARWAL (CA) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 09.05.2017 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 12.05.2017 VKNS'K@ ORDER PER SHRI KUL BHARAT, JM. THE APPEAL BY THE REVENUE, PERTAINING TO THE ASSESS MENT YEAR 2011-12, IS DIRECTED AGAINST THE ORDER OF LD. CIT (APPEALS)-1, JAIPUR DATED 19 DEC. 2014. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF AP PEAL :- 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS. 41,45,760/-, MADE ON ACCOUNT OF PROFIT ON SALE OF AGRICULTURE LA ND. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS. 8,66,056/-, MADE ON ACCOUNT OF DISALLOWANCE OF AGRICULTURE INCO ME AND TAXING THE SAME AS INCOME FROM OTHER SOURCES. 2. THE FACTS IN BRIEF ARE THAT, THE CASE OF THE ASS ESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT U/S 143 OF THE ACT, 1 961(HEREINAFTER REFERRED TO AS THE ACT.) WAS FRAMED VIDE ORDER DATED 13/03/2014. WHILE FRAMING THE ASSESSMENT THE ASSESSING OFFICER NOTICED THAT DURING THE YEAR UNDER APPEAL, THE ASSESSEE HAD 2 ITA NO.226/JP/2015 SMT. HAR DEVI ASNANI, JAIPUR. CLAIMED AN AMOUNT OF RS. 41,45,760/- AS EXEMPT ON T HE SALE OF AGRICULTURAL LAND. HOWEVER, DURING THE COURSE OF ASSESSMENT, A REVISED COMPUTATION OF TOTAL INCOME WAS FILED THEREBY THE ASSESSEE OFFERED PROFIT OF RS . 4,82,675/- ON SALE OF LAND SITUATED AT KHASRA NO. 2086 AT VILLAGE- RUPANGARH W HICH WAS PURCHASED FROM SMT. BEENA JYASWAL ON 06.05.2010. THIS LAND WAS ADJOINI NG TO ASSESSEES OTHER LAND WHICH WAS SOLD DURING THE YEAR UNDER APPEAL AND THE PROFIT ON SALE OF SUCH LAND WAS CLAIMED TO BE EXEMPT. HOWEVER, THE ASSESSING OFFIC ER PROCEEDED TO MAKE ADDITION OF THE SALE CONSIDERATION PERTAINING TO THIS PART O F LAND. HENCE, MADE ADDITION OF RS. 41,45,760/- ON THIS ACCOUNT. FURTHER, THE AO REJEC TED THE CLAIM OF AGRICULTURE INCOME OF RS.8,66,056/-. AGGRIEVED BY THIS, THE AS SESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A), WHO AFTER CONSIDERING THE SUBMISSIONS, DELETED BOTH THE ADDITIONS. NOW, THE REVENUE IS IN FURTHER APPEAL BEFORE THIS HONBL E TRIBUNAL. 3 GROUND NO. 1, IS AGAINST DELEING THE ADDITION OF RS. 41,45,760/-. THE LD. DEPARTMENTAL REPRESENTATIVES SHRI R.A. VERMA VEHEME NTLY ARGUED THAT THE LD. CIT(A) FAIL TO APPRECIATE THE FACT IN RIGHT PERSPEC TIVE. HE SUBMITTED THAT THE LD. CIT(A) HAS JUST ACCEPTED THE CONTENTION OF THE ASSE SSEE WITHOUT TAKING INTO ACCOUNT, THE FACT THAT DURING THE COURSE OF THE PROCEEDINGS THE ASSESSEE HERSELF HAD OFFERED PROFIT ON PART OF AGRICULTURAL LAND, WHICH WAS FORM ING PART OF THE SAME KHASRA WHICH THE ASSESSEE CLAIM TO BE NOT TAXABLE. THE LD. DEPA RTMENTAL REPRESENTATIVES SUBMITTED, UNDER THE FACTS OF THE PRESENT CASE WHEN THE ASSESSEE HERSELF HAS DECLARED PROFIT FROM SALE OF PART OF LAND. THEREFO RE, THE LD. CIT(A) OUGHT NOT TO HAVE DELETED THE ADDITION. 3 ITA NO.226/JP/2015 SMT. HAR DEVI ASNANI, JAIPUR. 3.1 ON THE CONTRARY, LD. COUNSEL FOR THE ASSESSEE S UPPORTED THE ORDER OF THE LD. CIT(A) AND SUBMITTED THAT THERE IS NOT DISPUTE WITH REGARD TO THE FACT THAT THE LAND INQUESTION HAS BEEN DECLARED AS FIXED ASSET BY TH E ASSESSEE. HE SUBMITTED THAT DISTINGUISHING FEATURES BETWEEN THAT THE SALE OF TH E CONSIDERATION OF THE PART OF THE LAND WHICH WAS OFFERED FOR TAXATION WAS IN FACT ACQ UIRED A DAY BEFORE AND THE HOLDING PERIOD WAS JUST ONE DAY AND IN THE CASE OF THE OTHER PART OF THE LAND IT WAS PURCHASED IN THE YEAR OF 2005 AND WAS NO CONVERTED AS STOCK IN TRADE. HE SUBMITTED THAT THERE IS NOT BAR UNDER THE LAW THAT THE ASSESSEE CANNOT KEEP TWO PORTFOLIOS, ONE IN INVESTMENT AND OTHER BEING THE STOCK IN TRADE. HE SUBMITTED THAT IN CASE OF JEWELER WHERE HE KEEPS JEWELLERY AS STOCK IN TRADE AND ALSO KEEPS JEWELLERY AS INVESTMENT. IN THE PRESENT CASE ADMIT TED FACTS ARE THAT THE PART OF LAND HAS BEEN DECLARED BY THE ASSESSEE AS FIXED ASSET IN THE BALANCE SHEET. THE ASSESSEE HAS BEEN CARRYING OUT AGRICULTURAL ACTIVIT IES ON THIS LAND WHICH IS EVIDENT FROM THE RECORD OF THE REVENUE IN THE FORM OF KHASR A AND GIRDAVARI. HE SUBMITTED THAT EVEN THE AGRICULTURE INCOME DERIVED FROM SUCH ACTIVITIES HAS BEEN DECLARED IN THE INCOME TAX RETURN OF THE ASSESSEE. UNDER THESE FACTS, THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION. 3.2 WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED TH E MATERIAL AVAILABLE ON RECORD. THE UNDISPUTED FACTS, WHICH ARE AVAILABLE ON THE RECORD ARE THAT THE LAND IN QUESTION IS AN AGRICULTURAL LAND AND TO THIS EFFECT , FINDING IS GIVEN BY THE LD. CIT(A) IS NOT CONTROVERTED BY THE REVENUE. THE LD. CIT(A) HAS ALSO GIVEN A FINDING THAT THIS PIECE OF LAND WAS NOT CONTROVERTED INTO STOCK IN TRADE TO REBUT THIS FINDING NO EVIDENCE IS PRODUCED BY THE REVENUE. FURTHER, IT I S NOTICED THAT THE CONTENTION OF 4 ITA NO.226/JP/2015 SMT. HAR DEVI ASNANI, JAIPUR. THE ASSESSEE IS THAT AGRICULTURAL ACTIVITIES WERE B EING CARRIED OUT AND THE LANDS WERE SITUATED BEYOND THE PRESCRIBED LIMIT. THIS FACT IS ALSO NOT REBUTTED BY THE REVENUE BY PLACING ANY CONTRARY MATERIAL ON RECORD. UNDER T HESE FACTS, WE DO NOT SEE ANY REASON TO DISTURB THE FINDING OF THE LD. CIT(A), SA ME IS HEREBY AFFIRMED. THIS GROUND OF THE REVENUES APPEAL IS DISMISSED. 4. GROUND NO. 2, IS AGAINST DELETION OF ADDITION OF RS. 8,66,056/- MADE ON ACCOUNT OF DISALLOWANCE OF AGRICULTURE INCOME AND T AXING THE SAME AS INCOME FROM OTHER SOURCES. THE LD. DEPARTMENTAL REPRESENTATIVE S HAS TAKEN US, THROUGH THE ASSESSMENT ORDER AND SUBMITTED THAT THE AO MADE ADD ITION ON THE BASIS THAT THE NET AGRICULTURE INCOME AS CLAIMED BY THE ASSESSEE WAS N OT FULLY SUBJECT TO VERIFICATION. HE SUPPORTED THE ORDER OF THE ASSESSING OFFICER. 4.1 ON THE CONTRARY, THE LD. COUNSEL FOR THE ASSESS EE REITERATED THE SUBMISSIONS AS MADE IN THE WRITTEN SUBMISSIONS. HE SUBMITTED T HAT ASSESSING OFFICER DREW WRONG INFERENCE OF THE REGISTERED DOCUMENTS I.E. PU RCHASE DEED. HE SUBMITTED THAT SUBSEQUENTLY THE ASSESSEE INSTALLED THE SYSTEM OF I RRIGATION. HE SUBMITTED THAT OUT OF AGRICULTURE INCOME DECLARED BY THE ASSESSEE OF R S. 8,66,056/- ON ACCOUNT OF AGRICULTURE PRODUCE SOLD WHICH WAS GROWN BY THE ASS ESSEE HERSELF. HE SUBMITTED THAT THE AO HAS MISCONSTRUED THE FACTS AND FAILED T O APPRECIATE THAT A PART OF THE LAND WAS GIVEN ON LEASE WHICH FETCHED SUM OF RS. 3, 30,000/- AND REMAINING PART OF THE LAND WAS UNDER SELF CULTIVATION AND THE CROP AS GROWN IN THAT WERE DULY REFLECTED IN THE KHASRA GIRDAWARI. IN SUPPORT OF THIS THE ASS ESSEE HAD FURNISHED SALE VOUCHERS ISSUED BY THE KRISHI UPAJ MANDI SAMITI DISCLOSING S ALE OF AGRICULTURE PRODUCE TO M/S MAHESHWARI TRADERS. HE SUBMITTED THAT KRISHI UPAJ M ANDI SAMITI IS NOT UNDER CONTROL 5 ITA NO.226/JP/2015 SMT. HAR DEVI ASNANI, JAIPUR. OR CONNECTED WITH THE ASSESSEE IN ANYWAY THE SAMITI IS CONTROLLED AND REGULATED BY THE GOVERNMENT REGULATION, THERE IS NO SCOPE OF MAN IPULATION. UNDER THESE FACTS, HE SUBMITTED THAT LD. CIT(A) HAS RIGHTLY DELETED TH E ADDITION. 4.2 WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED TH E MATERIAL AVAILABLE ON RECORD. WE FIND THAT LD. CIT(A) DELETED THE ADDITI ON HAS DECIDED THE ISSUE IN PARA 3.2.2 BY OBSERVING AS UNDER:- 3.2.2 I HAVE DULY CONSIDERED AOS CONTENTION AND APPELLA NTS SUBMISSION, PERUSED THE MATERIALS ON RECORD, DULY CONSIDERED FA CTUAL MATRIX OF THE CASE AND ALSO APPLICABLE LEGAL POSITION. ASSESSEE CONTENDS THAT THE AGGREGATE INCOME OF RS. 8,66,056/-, COMPRISING OF I NCOME FROM LEASE OF AGRICULTURE LAND AMOUNTING TO RS. 3,30,000/- AND INCOME FROM AGRICULTURE PRODUCE AMOUNTING TO RS. 5,36,056/- HAS BEEN DISCLOSED IN THE RETURN AS EXEMPT INCOME. ASSESSEE ALSO SUBMIT S THAT SHE DID NOT SHOW THE STOCK OF AGRICULTURE PRODUCE IN HER BOOKS OF ACCOUNTS NOR RECORD THE EXPENSES INCURRED BY HER FOR AGRICULTURA L ACTIVITIES BEING CARRIED ON BY HER BUT HAS SHOWN ONLY THE NET RECEIP TS FROM SALE OF AGRICULTURE PRODUCE WHICH IS ENTERED IN HER BOOKS O F ACCOUNTS AND THE CASH SO RECEIVED IS DEPOSITED IN HER BANK ACCOUNT, OVER A PERIOD OF TIME. THIS FACT HAS BEEN DISCLOSED IN HERE RETURNS FILED AND THE SAME HAS BEEN ADMITTED BY THE DEPARTMENTAL IN ALL THE PR EVIOUS ASSESSMENT MADE IN HERE CASE. ASSESSEE ALSO CONTENDS THAT THE EXCESS STOCK OF JWAR AND BAJR, WAS STORED AT ONE OF THE ASSESSEES FRIENDS PLACE ON THE FARMERS REQUEST WHICH WAS SUBSEQUENTLY SOLD TO M/S MAHESHWARI TRADERS ON 02.10.2010. IN VIEW OF FACTS AND CIRCUMSTANCES STATED ABOVE, I DO NOT FIND ANY VALID REASON TO DISALLOW THE CLAIM AND TREAT THE SAME AS INCOME FROM OTHER SOURCES AS HAS BEEN DONE BY THE LD. A.O. AOS ACTI ON IN DISALLOWING THE AGRICULTURE INCOME OF RS. 5,36,056/- AND INCOME FRO M LEASE OF AGRICULTURE 6 ITA NO.226/JP/2015 SMT. HAR DEVI ASNANI, JAIPUR. LAND OF RS. 3,30,000/- AS EXEMPT INCOME BY TREATING AS INCOME FROM OTHER SOURCES AND MAKING ADDITION OF RS. 8,66,056/- CANN OT BE SUSTAINED. 4.3 WE FIND THAT LD. CIT(A) HAS GIVEN A FINDING THA T THE ASSESSEE HAS BEEN DISCLOSING THE ONLY NET RECEIPTS FROM SALE OF AGRIC ULTURE PRODUCE WHICH IS ENTERED INTO BOOKS OF ACCOUNTS AND THE CASH OF RECEIPTS IS DEPOS ITED IN HER BANK ACCOUNT OVER A PERIOD OF TIME. THIS FACT HAS BEEN DISCLOSED IN E ARLIER YEAR HAS BEEN ACCEPTED BY THE DEPARTMENT. THIS FINDING IS NOT REBUTTED BY TH E REVENUE BY PLACING ANY CONTRARY MATERIAL ON RECORD. THEREFORE, WE DO NOT SEE ANY FINDING INTO THE ORDER OF THE LD. CIT(A), SAME IS HEREBY AFFIRMED. THIS GROU ND OF THE REVENUES APPEAL IS DISMISSED. 5. IN THE RESULT, APPEAL OF THE REVENUE IN ITA NO. 226/JP/2015 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON FRIDAY, THE 12TH DAY OF MAY 2017. SD/- SD/- FOE FLAG ;KNO ( DQY HKKJR ) (VIKRAM SINGH YADAV) ( KUL BHARAT ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 12/5/2017. POOJA/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- THE INCOME-TAX OFFICER, WARD 3 (1), JAIPUR. 2. THE RESPONDENT- SMT. HAR DEVI ASNANI, VAISHALI N AGAR, JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 226/JP/2015) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 7 ITA NO.226/JP/2015 SMT. HAR DEVI ASNANI, JAIPUR.