Shri Takhatsinhji J.Thakorsaheb,HUF, Ahmedabad V. The Income tax Officer,Ward-10(4), Ahmedabad

ITA 2480/AHD/2009

• Counselvise Citation: [2010] 137 COUNSELVISE.COM (IT) 0213 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 22-12-2009
• Assessment Year: 2006-2007
• Appeal Filed On: 26-08-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M C
• Assessee Lawyers: NINESH VAYAWALA
• Keywords: Income from undisclosed sources

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AHMEDABAD B BENCH, BEFORE SHRI BHAVNESH SAINI, J.M. AND SHRI A.N.PAHUJ A A.M. ITA NO.2480/AHD/2009 ASSESSMENT YEARS: 2006-2007 TAKHATSINHJI J. THAKORSAHEB HUF, 9, GANDHIBAUG SOCIETY, B/H. LAW COLLEGE, LAW GARDEN, NAVRANGPURA, AHMEDABAD. V/S INCOME TAX OFFICER, WARD 10(4), NARAYAN CHAMBERS, NEHRU BRIDGE CORNER, ASHRAM ROAD, AHMEDABAD PAN NO.AABHT234012 (APPELLANT) (RESPONDENT) FOR ASSESSEE: SHRI NINESH VAYAWALA, FOR DEPARTMENT: SHRI M.C.PANDIT, SR.DR O R D E R PER SHRI BHAVNESH SAINI, J.M. THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORD ER OF LEARNED CIT(APPEALS)-XVI, AHMEDABAD DATED 16.06.2009 FOR AY 2006-2007, CHALLENGING THE ADDITION OF RS.3,71,175/- ON ACCOUN T OF AGRICULTURAL INCOME. 2. WE HAVE HEARD LEARNED REPRESENTATIVES OF BOTH THE P ARTIES, PERUSED THE FINDINGS OF AUTHORITIES BELOW AND CONSI DERED THE MATERIAL AVAILABLE ON RECORD. 3. BRIEFLY THE FACTS OF THE CASE ARE THAT ASSESSEE FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS.1,001/- ON ACCOUNT OF INTEREST INCOME AND FOR RATE PURPOSES AGRICULTURAL INCOME WAS SHOWN AT RS.2 3,80,000/-. THE ASSESSING OFFICER MADE THE ADDITION ON ACCOUNT OF B ANK INTEREST IN A SUM OF RS.3,175/- AS WELL AS TREATED THE AGRICULTURAL INCO ME AS INCOME FROM UNDISCLOSED SOURCES AND ADDITION MADE ACCORDINGLY. THE ADDITION WAS CHALLENGED BEFORE LEARNED CIT(APPEALS) AND THE LEAR NED CIT(APPEALS) RESTRICTED THE ADDITION TO RS.3,71,185/- AS INCOME FROM OTHER SOURCES AND 2 BALANCE INCOME WAS TREATED AS AGRICULTURAL INCOME, APPEAL OF THE ASSESSEE ACCORDINGLY PARTLY ALLOWED. LD. COUNSEL FOR ASSESS EE SUBMITTED THAT ASSESSEE HAS NO OTHER INCOME EXCEPT THE INTEREST IN COME WHICH IS ASCERTAINED INCOME AND THE ASSESSING OFFICER HAS NO T BROUGHT ANY EVIDENCE ON RECORD THAT ASSESSEE HAS INCOME FROM OTHER SOURC ES. SINCE, AGRICULTURAL INCOME IS EXEMPT THEREFORE, PART ADDITION CONFIRMED BY THE CIT(APPEALS) IS ALSO LIABLE TO BE DELETED. ON THE OTHER HAND, LD. D R REPLIED UPON ORDER OF THE CIT(APPEALS) AND SUBMITTED THAT SINCE SPECIFIC DETA ILS OF PRODUCTION OF AGRICULTURE PRODUCE ARE NOT PROVIDED THEREFORE, CI T(APPEALS) WAS JUSTIFIED IN RESTRICTING THE PART ADDITION. 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND MATERIA L AVAILABLE ON RECORD AND WE ARE OF THE VIEW THAT THE ISSUE IS SQU ARELY COVERED BY ORDER OF ITAT, AHMEDABAD BENCH A IN THE CASE OF GOVINGBHAI BHOIWALA IN ITA NO.3008/AHD/ 2009 DATED 8.01.2010 IN WHICH ON THE S AME ISSUE APPEAL OF THE ASSESSEE HAS BEEN ALLOWED. THE FINDINGS IN THIS ORDER ARE REPRODUCED AS UNDER: 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND MA TERIAL AVAILABLE ON RECORD. 6. THE ITAT, SMC BENCH, INDORE, IN THE CASE OF ITO V. SMT. SHAHNAJ BANO; ITA NO.443/IND/04 IN WHICH THE TRIBUN AL VIDE ORDER DATED 7.01.2005 HELD IN PARA 8 AS UNDER: 8. AS REGARDS INVESTMENT IN FLAT, THE AO HAS NOT B ROUGHT ON RECORD ANY SOURCE OF INCOME EXCEPT THE INCOME FROM AGRICULTURE CLAIMED BY THE ASSESSEE. IF A PERSON HA S ONLY AGRICULTURAL INCOME AND NO OTHER INCOME, THEN NO AD DITION CAN BE MADE TO THE TOTAL INCOME, THEN NO ADDITION C AN BE MADE TO THE TOTAL INCOME UNLESS AND UNTIL THE AO PR OVES THAT THE ASSESSEE HAS ANY OTHER SOURCE OF INCOME WH ICH IS TAXABLE UNDER THE INCOME TAX ACT. THE AO HAS NOT BROUGHT ON RECORD ANY MATERIAL OR EVIDENCE TO SHOW THAT THE ASSESSEE WAS HAVING ANY OTHER SOURCE OF INCOME EXCEPT AGRICULTURAL INCOME WHICH IS NOT TAXABLE. CI T(A) WAS, THEREFORE, JUSTIFIED IN DELETING THE ADDITION OF RS.3,45,356/- TO THE TOTAL INCOME MADE BY THE AO BE CAUSE THE ASSESSEE HAS NO INCOME TAXABLE AND AGRICULTURAL INCOME IS NOT TAXABLE. 3 7. IN THE CASE OF NARENDRA BADJATIYA VS. ITO, ITAT, INDORE, SMC-I, IN ITA NO.537/IND/2006 IN A.Y. 2003-2004, H ELD IN PARA.6 AS UNDER:- 6. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND THE MATERIAL ON RECORD. I FIND THAT THE ASSESSING OFFICER WITHOU T BRINGING ANY MATERIAL ON RECORD ESTIMATED THE EXPENSES ON CULTIV ATION. THE AO HAS NOT POINTED OUT AS TO WHICH OF THE EXPENDITURE IS NOT SUPPORTED BY BILL OR VOUCHER. THE AO MERELY FOUND THAT THE EX PENSES ARE VERY LOW. THE AO USED THE EXPRESSION THAT IT IS COMMON K NOWLEDGE THAT THE EXPENSES ON CULTIVATION OF LAND ARE GENERALLY 4 0% OF THE GRASS PRODUCE. IN THE ABSENCE OF ANY SPECIFIC OR RELIABLE MATERIAL ON RECORD AGAINST THE ASSESSEE, THE AO IS NOT JUSTIFIE D IN ESTIMATING THE EXPENSES ON CULTIVATION. THE AO INSTEAD OF MAKI NG THE ADDITION OF RS.58,000/- MADE THE ADDITION WRONGLY IN A SUM O F RS.67,000/-. THE ASSESSEE ADMITTEDLY APART FROM AGRICULTURAL INC OME, THE ASSESSEE HAS INCOME FROM HOUSE PROPERTY, CAPITAL GA INS AND INTEREST ON FDR AND DEVIDED. THE INCOME FROM THESE SOURCES IS SPECIFIC AND ASCERTAINED. THEREFORE, THE ASSESSEE W OULD HAVE BEEN LEFT WITH THE AGRICULTURE INCOME WHICH IS EXEM PT. THEREFORE, THE ORDER OF THE ITAT, INDORE BENCH, IN THE CASE OF SMT. SHAHNAZ BANO (SUPRA) IS CLEARLY APPLICABLE TO SHOW THAT THE ASSESSEE HAS ONLY THE AGRICULTURE INCOME BECAUSE THE AO HAS NOT BROUGHT ANY EVIDENCE ON RECORD TO SHOW THAT THE ASSESSEE HAS IN COME FROM OTHER SOURCES ALSO. THE DECISIONS CITED BY THE LD. COUNSEL FOR THE ASSESSEE (SUPRA) ARE CLEARLY APPLICABLE TO THIS CAS E. CONSIDERING THE ABOVE DISCUSSION AND THE FACT THAT ONLY AD HOC ADDITION IS MADE, THERE IS NO REASON TO SUSTAIN THE ORDERS OF T HE AUTHORITIES BELOW. I, ACCORDINGLY, SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DELETE THE ENTIRE ADDITION. 8. CONSIDERING THE FACTS OF THE CASE IN THE LIGHT O F THE ABOVE DECISION OF THE TRIBUNAL, IT IS CLEAR THAT ASSESSEE HAS APART FROM AGRICULTURAL INCOME AND HAS INTEREST INCOME ON THE FDR AND POSTAL MONTHLY INCOME FROM THE KNOWN SOURCES. T HE INCOME FROM THESE SOURCES ARE SPECIFIC AND ASCERTAI NED. THEREFORE, THE ASSESSEE WOULD HAVE BEEN LEFT WITH T HE AGRICULTURAL INCOME WHICH IS EXEMPT. THE ABOVE DEC ISIONS OF ITAT INDORE BENCH, IN THE CASE OF SMT. SHAHENAJ BAN O (SUPRA) AND NARENDRA BADJATIYA (SUPRA) ARE CLEARLY APPLICABLE TO THE ABOVE CASE. SICNE, THE ASSESSEE H AS ONLY AGRICULTURAL INCOME AND ASSESSING OFFICER HAS NOT B ROUGHT ANY EVIDENCE ON RECORD THAT ASSESSEE HAS INCOME FRO M OTHER SOURCES ALSO, THEREFORE, THERE IS NOT REASON TO SUSTAIN THE ORDERS OF THE AUTHORITIES BELOW. WE ACCORDINGLY SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND DELETE THE ADDI TION OF RS.1,50,000/-. 9. AS A RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. 4 5. CONSIDERING THE FACTS OF THE CASE, IN THE LIGHT OF THE ABOVE DECISION, WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW AS DEL ETE THE ADDITION OF RS.3,71,175/-. 6. AS A RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH JANUARY, 2010. SD/- SD/- (A.N.PAHUJA) ACCOUNTANT MEMBER (BHAVNESH SAINI) JUDICIAL MEMBER DATE : 08/01/2010 PARAS* COPY OF THE ORDER FORWARDED TO : 1. THE RESPONDENT 2. THE DCIT, (APPELLANT). 3. THE CIT CONCERNED 4. THE CIT(A)-II, SURAT 5. THE DR, ITAT, 6. GUARD FILE BY ORDER //TRUE COPY// DY.R/AR, ITA T, AHMEDABAD