SHRI RAM PRASAD MEENA, KOTA V. ITO, Ward -1(2), KOTA

ITA 278/JPR/2020

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 6949 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-09-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 22-06-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RUNI PAUL JCIT DR DHK
• Keywords: Unexplained investment; Sale consideration of property below Jantri Value; Capital asset
• Section: 56(2)(vii)(b); 143(3); 2(14); 13; 56

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,B JAIPUR JH JESK LH-'KEKZ] YS[KK LNL; ,O LAANHI XKSLKBZ] U;KF;D LNL; DS LE{K BEFORE: SHRI RAMESH C SHARMA, AM & SHRI SANDEEP GOS AIN, JM VK;DJ VIHY LA-@ ITA NO.278/JP/2020 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2014-15 SHRI RAM PRASAD MEENA 207, AJAY AHUJA NAGAR EXTENSION RANGBARI, KOTA CUKE VS. THE ITO WARD 1(2) KOTA LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: BVLPM 0033J VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL, CA JKTLO DH VKSJ LS@ REVENUE BY: SMT. RUNI PAUL , JCIT DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 17/08/2020 MN?KKS'K.KK DH RKJH[K@ DATE OF PRONOUNCEMENT: 03 /09/2020 VKNS'K@ ORDER PER SANDEEP GOSAIN, J.M. THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF LD.CIT (A), KOTA DATED 21.02.2020 FOR THE ASSES SMENT YEAR 2014-15 PASSED UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 ON THE GROUNDS MENTIONED HEREINBELOW. 1. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW I N CONFIRMING THE ADDITION OF RS.77,74,535/- U/S 56(2)(VII)(B)(II), B EING DIFFERENCE BETWEEN THE STAMP DUTY VALUE AND PURCHASE VALUE OF AGRICULTURAL LAND BY NOT ACCEPTING THE CONTENTION OF ASSESSEE THAT TH IS SECTION IS APPLICABLE ON PURCHASE OF IMMOVABLE PROPERTY BEING A CAPITAL ASSET AND ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 2 SINCE AGRICULTURAL LAND PURCHASED BY ASSESSEE IS NO T A CAPITAL ASSET, PROVISION OF SAID SECTION IS NOT APPLICABLE. 2. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS.38,38,739/- BY TREATING THE SOURCE O F INVESTMENT IN AGRICULTURAL LAND TO THIS EXTENT AS UNEXPLAINED. 2.1 BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE F ILED HIS RETURN OF INCOME DECLARING TOTAL INCOME OF RS.1,96,940/- ON 8 -07-2014 WITHOUT SPECIFYING THE NATURE OF INCOME AND NATURE OF BUSIN ESS. THE ASSESSMENT WAS COMPLETED U/S 143(3) OF THE INCOME TAX ACT, 196 1 ON 30 TH DEC,. 2016 BY ITO CONCERNED BY MAKING ADDITION OF RS. 77, 74,535/- U/S 56(2)(VII)(B)(II) OF THE ACT AND RS. 40,94,290/- AS UNEXPLAINED INVESTMENT ON PURCHASE OF AGRICULTURAL LAND AT A TOTAL INCOME OF RS. 1,20,65,770/-. 2.2 AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE PREFERRED THE APPEAL BEFORE THE LD. CIT(A) AND THE LD. CIT(A) AFTER CONS IDERING THE CASE OF BOTH THE PARTIES PARTLY ALLOWED THE APPEAL FILED BY THE ASSESSEE. 2.3 NOW AGGRIEVED BY THE ORDER OF THE LD. CIT(A), T HE ASSESSEE HAS PREFERRED THE PRESENT APPEAL BEFORE US ON THE GROUN DS MENTIONED HEREINABOVE. 2.4 THE GROUND NO. 1 RAISED BY THE ASSESSEE RELATES TO CHALLENGING THE ORDER OF THE LD. CIT(A) IN CONFIRMING THE ADDITION U/S 56(2)(VII)(B)(II) OF THE ACT BEING DIFFERENCE BETWEEN STAMP DUTY VALUE A ND PURCHASE VALUE OF AGRICULTURAL LAND. ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 3 2.5 THE LD. AR APPEARING ON BEHALF OF THE ASSESSEE REITERATED THE SAME ARGUMENTS AS WERE RAISED BY HIM BEFORE THE REVENUE AUTHORITIES AND SUBMITTED THAT THE REVENUE AUTHORITIES FELL IN ERRO R IN CONFIRMING THE ADDITION U/S 56(2)(VII)(B)(II) OF THE ACT BEING DIF FERENCE BETWEEN THE STAMP DUTY VALUE AND PURCHASE VALUE OF AGRICULTURAL LAND, BY NOT ACCEPTING THE CONTENTION OF THE LD.AR OF THE ASSESS EE THAT PROVISIONS OF SECTION 56 ARE ONLY APPLICABLE ON PURCHASE OF IMM OVABLE PROPERTY BEING A CAPITAL ASSET. AS PER LD.AR, SINCE THE AGRICULTURAL LAND PURCHASED BY THE ASSESSEE IS NOT A CAPITAL ASSET , THEREFORE, THE PROVISIONS OF SECTION 56 ARE NOT ATTRACTED IN THE C ASE OF THE ASSESSEE. THE LD.AR OF THE ASSESSEE RELIED ON THE WRITTEN SUBMISS IONS FILED BY HIM REGARDING THE GROUND NO. 1 WHICH ARE REPRODUCED AS UNDER:- 1. THE ASSESSEE BELONGS TO AN AGRICULTURAL FAMILY . THE FATHER OF ASSESSEE SH. NAINALALMEENA HAS BEEN DOING THE AGRICULTURAL A CTIVITY OVER LAST 30 YEARS.DURING THE YEAR THE FATHER OF ASSESSEE HAS PU RCHASED 4 AGRICULTURAL LANDS IN THE NAME OF ASSESSEE FOR RS.40,94,290/- INCLUDING S TAMP DUTY AND REGISTRATION CHARGES AS MENTIONED AT PG 2-3 OF THE ASSESSMENT OR DER. THE SUB-REGISTRAR FOR STAMP DUTY PURPOSE VALUED IT AT RS.1,18,68,825/-. A CCORDINGLY, AO MADE THE ADDITION OF RS.77,74,535/- (1,18,68,825-40,94,290) U/S 56(2)(VII)(B)(II) OF THE ACT. 2. BEFORE LD. CIT(A) ASSESSEE SUBMITTED THAT SECTIO N 56(2)(VII)(B)(II) IS NOT APPLICABLE AS ONLY THOSE PROPERTIES WHICH ARE C APITAL ASSET FALL IN THE AMBIT OF THIS SECTION. THE AGRICULTURAL LAND PURCHASED IN TH E NAME OF ASSESSEE DO NOT FALL IN THE DEFINITION OF CAPITAL ASSET AND THEREFORE, THIS SECTION IS NOT APPLICABLE. 3. THE LD. CIT(A) HELD THAT SECTION 56(2)(VII)(B) M AKES REFERENCE TO ANY IMMOVABLE PROPERTY AND NOT THE CAPITAL ASSET. AGRIC ULTURAL LAND IS VERY WELL COVERED UNDER ANY IMMOVABLE PROPERTY AND THUS FALLS WITHIN THE PREVIEW OF SECTION 56(2)(VII)(B). ACCORDINGLY, HE CONFIRMED TH E ADDITION. ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 4 SUBMISSION:- 1. THE PROVISIONS OF SECTION 56(2)(VII)(B)(II) READS A S UNDER:- '(VII) WHERE AN INDIVIDUAL OR A HINDU UNDIVIDED FAM ILY RECEIVES, IN ANY PREVIOUS YEAR, FROM ANY PERSON OR PERSONS ON OR AFT ER THE 1ST DAY OF OCTOBER, 2009 BUT BEFORE THE 1ST DAY OF APRIL, 2017, (B) ANY IMMOVABLE PROPERTY, (I) . (II) FOR A CONSIDERATION WHICH IS LESS THAN THE STA MP DUTY VALUE OF THE PROPERTY BY AN AMOUNT EXCEEDING FIFTY THOUSAND RUPEES, THE STAMP DUTY VALUE OF SUCH PROPERTY AS EXCEEDS SUCH CONSIDE RATION EXPLANATION.FOR THE PURPOSES OF THIS CLAUSE, (D)'PROPERTY' MEANS THE FOLLOWING CAPITAL ASSET OF THE ASSESSEE, NAMELY:- (I) IMMOVABLE PROPERTY BEING LAND OR BUILDING OR BO TH; (II) SHARES & SECURITIES (III) JEWELLERY . (IX) BULLION THUS AS PER THE ABOVE EXPLANATION, ALL MOVEABLE OR IMMOVABLE PROPERTIES OF ANY NATURE ARE NOT COVERED IN THE DEFINITION OF PROPERTY. ONLY THOSE MOVEABLE OR IMMOVABLE PROPERTIES WHICH ARE HELD AS CAPITAL ASSETS AND WHICH FALLS IN ANY OF THE CLAUSES (I) TO (IX) ARE ONLY CO VERED U/S 56(2)(VII). ACCORDINGLY, ANY PROPERTY WHICH IS NOT A CAPITAL AS SET IS NOT COVERED WITHIN THE MEANING OF MOVEABLE OR IMMOVABLE PROPERTIES U/S 56(2)(VII). IN THE PRESENT CASE, THE AGRICULTURAL LAND PURCHASED BY TH E ASSESSEE IS SITUATED AT VILLAGE MANDANA WHICH IS AT A DISTANCE OF 28 KMS FR OM THE MUNICIPAL LIMIT OF KOTA. HENCE, THE AGRICULTURAL LAND PURCHASED IN THE NAME OF ASSESSEE IS NOT A CAPITAL ASSET AS PER THE PROVISIONS OF SECTION 2(14 ) OF THE ACT AND THEREFORE, NOT COVERED BY THE DEFINITION OF PROPERTY GIVEN IN EX PLANATION (D) TO SECTION 56(2)(VII)(B) OF THE ACT. 2. FOR THIS PURPOSE RELIANCE IS PLACED ON THE DECIS ION OF HONBLE ITAT BENCH IN CASE OF ITO VS. SH. TRILOK CHAND SAIN WHER E AT PARA 14 (PB 25) IT IS HELD AS UNDER:- ON READING OF PROVISIONS OF 56(2)(VII)(B), WE FIND THAT IT REFERS TO ANY IMMOVABLE PROPERTY. FURTHER, PROVISION OF SECTION 5 6(2)(VII)(C) REFERS TO ANY PROPERTY OTHER THAN IMMOVABLE PROPERTY. THE MEANING OF THE TERM PROPERTY HAS BEEN PROVIDED IN EXPLANATION (D) TO SECTION 56( 2)(VII) WHERE THE TERM PROPERTY HAS BEEN DEFINED TO MEAN CAPITAL ASSET OF THE ASSESSEE NAMELY ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 5 IMMOVABLE PROPERTY BEING LAND OR BUILDING OR BOTH. IT HAS BEEN CONTENDED BY LD AR THAT ALL IMMOVABLE PROPERTIES OF ANY NATURE A RE NOT COVERED IN THE DEFINITION OF PROPERTY. ONLY THOSE IMMOVABLE PROPER TIES WHICH ARE HELD AS CAPITAL ASSETS AND IS IN NATURE OF LAND OR BUILDING OR BOTH ARE ONLY COVERED U/S 56(2)(VII). WE AGREE WITH THE CONTENTION OF LD AR T HAT WHERE THE TERM PROPERTY HAS BEEN DEFINED TO MEAN A CAPITAL ASSET AS SO SPECIFIED AND WHERE AN IMMOVABLE PROPERTY AS SO SPECIFIED BEING LAND, B UILDING OR BOTH IS NOT HELD AS AN CAPITAL ASSET, IT WILL NOT BE SUBJECT TO THE PROVISIONS OF SECTION 56(2)(VII)(B) OF THE ACT. IN VIEW OF ABOVE, ADDITION CONFIRMED BY LD. CIT(A) BE DIRECTED TO BE DELETED. 2.6 ON THE OTHER HAND, LD. DR RELIED ON THE ORDERS PASSED BY THE REVENUE AUTHORITIES ON THIS GROUND. 2.7 WE HAVE HEARD LD. COUNSELS FOR BOTH THE PARTIES , PERUSED THE MATERIALS PLACED ON RECORD, ORDERS PASSED BY THE REVENUE AUTHORITIES AS WELL AS JUDGEMENTS/ORDERS CITED BY THE PARTIES. FROM THE RECORD, WE NOTICED THAT TH E AO HAD MADE ADDITION IN THE CASE OF THE ASSESSEE U/S 56(2)(VII)(B)(II) OF THE ACT ON THE GROUND THAT AGRICULTURAL LAND PURCHASED BY THE ASSESSEE FOR STAMP DUTY PURPO SES IS VALUING AT RS. 1,18,68,825/- AND DURING THE YEAR THE FATHER OF THE ASSESSEE HAD PURCHASED THE SAID AGRICULTURAL LANDS IN THE NAME OF THE ASSE SSEE FOR A TOTAL CONSIDERATION OF RS.40,94,290/-. THEREFORE, THE AO HAD MADE ADDITION ON THE DIFFERENCE AMOUNT OF RS.77,74,535/-, APPLYING T HE PROVISIONS OF SECTION 56(2)(VII)(B)(II) OF THE ACT BY HOLDING THA T AGRICULTURAL LAND IS VERY WELL COVERED UNDER THE TERM IMMOVABLE PROPER TY AND THUS FALLS WITHIN THE PURVIEW OF SECTION 56(2)(VII)(B)(II) OF THE ACT. ACCORDINGLY, THE LD. CIT(A) ALSO CONFIRMED THE SAID ADDITION. ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 6 2.8 HOWEVER, IN ORDER TO DECIDE THE CONTROVERSY IN QUESTION, IT IS NECESSARY AND IMPERATIVE FOR US TO FIRST DELIBERATE UPON THE PURE WORDINGS OF THE PROVISIONS OF SECTION 56(2)(VII)(B)(II) OF T HE ACT WHICH READS AS UNDER:- '(VII) WHERE AN INDIVIDUAL OR A HINDU UNDIVIDED FAM ILY RECEIVES, IN ANY PREVIOUS YEAR, FROM ANY PERSON OR PERSONS ON OR AFT ER THE 1ST DAY OF OCTOBER, 2009 BUT BEFORE THE 1ST DAY OF APRIL, 2017 , (B) ANY IMMOVABLE PROPERTY, (I) . (II) FOR A CONSIDERATION WHICH IS LESS THAN THE STA MP DUTY VALUE OF THE PROPERTY BY AN AMOUNT EXCEEDING FIFTY THOUSAND RUPEES, THE STAMP DUTY VALUE OF SUCH PROPERTY AS EXCEEDS SUCH CONSIDE RATION EXPLANATION.FOR THE PURPOSES OF THIS CLAUSE, (D)'PROPERTY' MEANS THE FOLLOWING CAPITAL ASSET OF THE ASSESSEE, NAMELY:- (I) IMMOVABLE PROPERTY BEING LAND OR BUILDING OR BO TH; (IV) SHARES & SECURITIES (V) JEWELLERY . (IX) BULLION. THUS ON THE PLAIN READING OF THE ABOVE EXPLANATION, IT IS IMPLICIT CLEAR THAT ALL THE MOVEABLE AND IMMOVABLE PROPERTIE S OF ANY NATURE ARE NOT COVERED UNDER THE DEFINITION OF PROPERTY. A CCORDINGLY, ON THOSE MOVABLE AND IMMOVABLE PROPERTIES WHICH ARE HELD AS CAPITAL ASSET AND WHICH FALLS IN ANY OF THE CLAUSES (I) TO (IX) ARE ONLY COVERED U/S 56(2)(VII) OF THE ACT. THUS ANY PROPERTY WHICH IS N OT A CAPITAL ASSET IS NOT COVERED WITHIN THE MEANING OF MOVEABLE OR I MMOVABLE ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 7 PROPERTIES U/S 56(2)(VII) OF THE ACT. THE LD.AR I N ORDER TO SUPPORT HIS CONTENTION HAD ALSO RELIED ON THE DECISION OF ITAT COORDINATE BENCH IN THE CASE OF ITO VS SHRI TRILOK CHAND (ITA NO. 449/J P/2018 ORDER DATED 26-05-2020) WHEREIN ALSO UNDER IDENTICAL SITUATION, THE ITAT COORDINATE BENCH HAD DECIDED THAT PROVISIONS OF SECTION 56(2)( VII) ARE APPLICABLE ONLY IN THE CASE OF CAPITAL ASSET AND THE OPERA TIVE PORTION OF THE ORDER OF ITAT COORDINATE BENCH IS REPRODUCED BELOW. 14. ON READING OF PROVISIONS OF 56(2)(VII)(B), WE FIND THAT IT REFERS TO ANY IMMOVABLE PROPERTY. FURTHER, PROVISION OF SE CTION 56(2)(VII)(C) REFERS TO ANY PROPERTY OTHER THAN IMMOVABLE PROPERTY. THE MEA NING OF THE TERM PROPERTY HAS BEEN PROVIDED IN EXPLANATION (D) TO SECTION 56(2)(VII) WHERE THE TERM PROPERTY HAS BEEN DEFINED TO MEAN CAPIT AL ASSET OF THE ASSESSEE NAMELY IMMOVABLE PROPERTY BEING LAND OR BUILDING OR BOTH. IT HAS BEEN CONTENDED BY LD AR THAT ALL IMMOVABLE PROPERTIES OF ANY NATURE ARE NOT COVERED IN THE DEFINITION OF PROPERTY. ONLY THOSE I MMOVABLE PROPERTIES WHICH ARE HELD AS CAPITAL ASSETS AND IS IN NATURE OF LAND OR BUILDING OR BOTH ARE ONLY COVERED U/S 56(2)(VII). WE AGREE WITH THE CONTENTIO N OF LD AR THAT WHERE THE TERM PROPERTY HAS BEEN DEFINED TO MEAN A CAPITAL ASSET AS SO SPECIFIED AND WHERE AN IMMOVABLE PROPERTY AS SO SPECIFIED BEING L AND, BUILDING OR BOTH IS NOT HELD AS AN CAPITAL ASSET, IT WILL NOT BE SUBJEC T TO THE PROVISIONS OF SECTION 56(2)(VII)(B) OF THE ACT. THEREFORE, KEEPING IN VIEW OUR ABOVE DISCUSSIONS AN D ALSO KEEPING IN VIEW THE DECISION OF ITAT COORDINATE BENCH (SUPRA) UNDER IDENTICAL CIRCUMSTANCES, WE ARE ALSO OF THE VIEW THAT ANY PRO PERTY WHICH IS NOT A CAPITAL ASSET IS NOT COVERED WITHIN THE MEANING OF MOVABLE OR IMMOVABLE PROPERTIES U/S 56(2)(VII) OF THE ACT. IN THE PRESENT CASE, THE AGRICULTURAL LAND PURCHASED BY THE ASSESSEE IS SITU ATED AT VILLAGE MANDANA, ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 8 KOTA WHICH SITUATED AT A DISTANCE OF 28 KM FROM MUN ICIPAL LIMITS OF KOTA. THEREFORE, THE AGRICULTURAL LAND PURCHASED I N THE NAME OF THE ASSESSEE IS NOT A CAPITAL ASSET AS PER PROVISIO NS OF SECTION 2(14) OF THE ACT AND IT IS NOT COVERED BY THE DEFINITION OF PR OPERTY GIVEN IN EXPLANATION TO SECTION 56(2)(VII)(B) OF THE ACT. TH US, WE DIRECT THE AO TO DELETE THE ADDITION. 3.1 THE GROUND NO. 2 OF THE ASSESSEE RELATES TO CHA LLENGING THE ORDER OF THE LD. CIT(A) IN CONFIRMING THE ADDITION OF RS. 38,38,739/ BY TREATING THE SOURCE OF INVESTMENT IN AGRICULTURAL LAND TO TH IS EXTENT AS UNEXPLAINED. 3.2 THE LD.AR APPEARING ON BEHALF OF THE ASSESSEE R EITERATED THE SAME ARGUMENTS AS WERE RAISED BY HIM BEFORE THE REVENUE AUTHORITIES AND HAS ALSO RELIED ON THE WRITTEN SUBMISSIONS SUBMITTED BE FORE US WHICH ARE REPRODUCED BELOW. 1. THE AO IN THE ASSESSMENT ORDER HAS OBSERVED THAT ASSESSEE HAS SHOWN INCOME OF RS.1,96,340/- ONLY IN THE RETURN OF INCOM E WHEREAS THE AGRICULTURAL LAND PURCHASED IS RS.40,94,290/-. THE ASSESSEE EXPLAINED THAT HIS FATHER SH. NAINALALMEENA WAS HAVING AGRICULTURE LAND OF 30 BIG HA WHICH IS IRRIGATED. IN SUPPORT OF THE AGRICULTURE INCOME KHASRAGIRDAWARI, RECEIPT FROM SALE OF CROP IN KRISHIMANDI AND THE AFFIDAVIT OF FATHER OF ASSESSEE WAS FILED. HOWEVER, THE AO HELD THAT THE EVIDENCE OF AGRICULTURE INCOME FILED BY THE ASSESSEE AND THE INCOME DECLARED BY THE ASSESSEE IN RETURN IS MEAGRE AND AS SESSEE IS NOT ABLE TO PROVE THE IMMEDIATE SOURCE OF INVESTMENT IN THE PURCHASE OF L AND. HE THEREFORE, TREATED THE INVESTMENT IN AGRICULTURE LAND AS UNEXPLAINED AND M ADE ADDITION FOR THE SAME. ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 9 2. THE LD. CIT(A) AFTER CONSIDERING THE EVIDENCE OF AGRICULTURE LAND HOLDING, CROP SOWN, CROP SOLD AND THE SALE RECEIPTS OF VARIOUS CROPS BY THE ASSESEES FATHER HELD THAT ONLY THE PROFIT OUT OF T HE SALE RECEIPT OF VARIOUS CROPS CAN BE CONSIDERED AS AVAILABLE FOR INVESTMENT AND NOT T HE ENTIRE SALE RECEIPT. THE TOTAL SALE RECEIPT FOR FY 2011-12 TO 2013-14 (UPTO 26.10. 2013) IS WORKED OUT BY HIM AT RS.12,77,755/- AND BY APPLYING A RATE OF 20% HE WOR KED OUT PROFIT ON SALE OF AGRICULTURAL PRODUCE AT RS.2,55,551/-. TO THIS EXTE NT HE CONSIDERED THE SOURCE OF INVESTMENT AS EXPLAINED AND CONFIRMED THE BALANCE A DDITION OF RS.38,38,739/-. 3. IT IS SUBMITTED THAT AFTER THE ORDER OF LD. CIT( A) THERE IS NO DISPUTE AS TO THE FACT THAT SOURCE OF INVESTMENT IN THE AGRICU LTURAL LAND IS OUT OF THE AGRICULTURAL INCOME EARNED BY THE FAMILY OUT OF THE ANCESTRAL AGRICULTURAL LAND OF 30 BIGHA AT VILLAGE CHADAWAD, TEHSIL SANGOD, KOTA. THIS LAND IS FULLY IRRIGATED IN WHICH VARIOUS CROPS LIKE WHEAT, DHANIYA, SARSO, SOY ABEAN, LAHSUN, ETC. IS CULTIVATED. IN COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE VIDE LETTER DT. 06.09.2016 (PB 6) EXPLAINED THAT GENERALLY THE CULTIVATION OF CROPS IS DONE TWICE IN THE YEAR IN ADDITION TO THE SEASONAL VEGETABLES. THE VEGETABLES AND LAHSUN ARE SOLD IN LOCAL MARKET/ VEGETABLE MANDI FOR WHICH IT IS NOT PRACTICALLY POSSIBLE TO GET THE SALE RECEIPT. HOWEVER, THE CROPS LIKE SARSO, SO YABEAN, WHEAT, TILLI, ETC. IS SOLDIN KRISHIMANDISAMITI THROUGH ARTIYA FOR WHICH THE MAND I RECEIPT IS AVAILABLE. THE DETAILS OF SUCH RECEIPT FOR FY 2010-11 TO 2013-14 W AS FILED (PB 8-9 & 11-12) . ACCORDING TO THESE DETAILS THE AGRICULTURAL RECEIPT IS AS UNDER:- FY RECEIPT EVIDENCE FROM LEDGER OF ARTIYA MADHAV LAL BADRI LAL & SONS (IN RS.) RECEIPT EVIDENCE FROM KRISHIMANDI PARCHI (IN RS.) TOTAL PB PG 2010-11 DETAILS NOT AVAILABLE 3,75,744/- 3,75,744/- 11 2011-12 6,93,594/- 2,52,912/- 9,46,506/- 8 & 11 2012-13 3,27,035/- 1,87,543/- 5,14,578/- 8 & 11 2013-14 (UPTO 16.12.13) 2,57,126/- 61,450/- 3,18,576/- 9 & 12 TOTAL 12,77,755/- 8,77,649/- 21,55,404/- THE ABOVE EVIDENCE IS ONLY AN INDICATION OF THE AGR ICULTURE INCOME OF THE ASSESSEE. THIS DOES NOT INCLUDE THE SALE OF LAHSUN AND VEGETA BLES WHICH IS SOLD IN LOCAL MARKET. THE AVERAGE INCOME FROM SALE OF LEHSUN PER BIGHA COMES TO RS.30,000/- TO RS.35,000/- PER BIGHA, I.E. RS.9 TO 10 LACS PER ANN UM. SIMILARLY THE REALISATION FROM SALE OF VEGETABLE IS ALSO RS.30,000/- TO RS.40 ,000/- PER BIGHA, I.E. RS.9 TO 12 LACS P.A. THEREFORE, AFTER CONSIDERING THE AGRICULT URE EXPENSES AND THE HOUSEHOLD EXPENSES, THE NET SAVING FROM AGRICULTURE IS APPROX IMATELY RS.10 LACS P.A. I.E. AROUND RS.25,000/- TO RS.30,000/- PER BIGHA WHICH I S QUITE REASONABLE. THUS, THE SOURCE OF INVESTMENT IN THE AGRICULTURAL LAND IS OU T OF THE AGRICULTURAL INCOME AND SAVINGS OF THE FAMILY OF PAST YEARS. ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 10 4. THE LD. CIT(A) HAS CONSIDERED THE AGRICULTURAL I NCOME FROM FY 2011- 12 TO 2013-14 ONLY AT RS.12,77,755/- AS PER THE LED GER ACCOUNT OF ASSESSEE IN THE BOOKS OF MADHAV LAL BADRI LAL & SONS. HE HAS NOT CO NSIDERED THE EVIDENCE OF AGRICULTURAL CROP SOLD DIRECTLY THROUGH VIKRAY PARC HI AMOUNTING TO RS.8,77,649/- AS ABOVE. HE HAS ALSO NOT CONSIDERED THE SALE OF LAHSU N/ VEGETABLES WHICH IS SOLD IN LOCAL MARKET/ VEGETABLE MARKET FOR WHICH KRISHI MAN DI VIKRAY PARCHI IS NOT GENERATED. THIS APART HE HAS CONSIDERED THAT FOR EA RNING THE AGRICULTURE INCOME 80% IS INCURRED IN EXPENSES WHICH IS GROSSLY UNREAS ONABLE. IN FACT THE ASSESSEE BELONGS TO AN AGRICULTURAL FAMILY AND INVOLVES IN T HE AGRICULTURE ACTIVATES THEMSELVES. THEREFORE, THE EXPENDITURE ON AGRICULTU RE IS HARDLY 40%. THUS, THE INCOME FROM AGRICULTURE SHOULD BE ESTIMATED AT 60% OF THE SALE RECEIPT. THUS, EVEN AS PER THE EVIDENCES AVAILABLE, THE INCOME AVA ILABLE FROM THE SALE OF AGRICULTURE CROP, ON THE BASIS TAKEN BY LD. CIT(A), WORKS OUT AT RS.12,93,242/- (60% OF RS.21,55,404/-) AS AGAINST RS.2,55,551/- WO RKED OUT BY HIM. FURTHER WHEN THE INCOME FROM SALE OF LAHSUN AND VEGETABLE I S INCLUDED THE SOURCE OF INVESTMENT IN THE AGRICULTURAL LAND GETS FULLY EXPL AINED. IN VIEW OF ABOVE, ADDITION OF RS.38,38,739/- CONFIR MED BY LD. CIT(A) BE DIRECTED TO BE DELETED. 3.3 ON THE OTHER HAND, THE LD. DR RELIED ON THE ORD ERS PASSED BY THE REVENUE AUTHORITIES. 3.4 WE HAVE HEARD LD. COUNSELS FOR BOTH THE PARTIES , PERUSED THE MATERIALS PLACED ON RECORD, ORDERS PASSED BY THE RE VENUE AUTHORITIES AS WELL AS JUDGEMENTS/ORDERS CITED BY THE PARTIES. FRO M THE FACTS ON RECORD, WE FOUND THAT THE ASSESSEE HAS SHOWN INCOME OF RS. 1,96,340/- IN THE RETURN OF INCOME WHEREAS THE AGRICULTURAL LAND PURC HASED IS RS. 40,94,290/-. IN THIS RESPECT, THE ASSESSEE HAS CATE GORICALLY EXPLAINED THAT HIS FATHER WAS HAVING AGRICULTURAL LAND OF 30 BIGHA WHICH WAS IRRIGATED. THE ASSESSEE IN SUPPORT OF THE AGRICULTURE INCOME F ILED THE KHASRA ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 11 GIRDAWAWRI, RECEIPT FROM SALE OF CROP IN KRISHI MAN DI AND THE AFFIDAVIT OF HIS FATHER. HOWEVER, THE AO HELD THAT THE EVIDENCE OF AGRICULTURAL INCOME FILED BY THE ASSESSEE IN HIS RETURN IS MEAGER AND T HE ASSESSEE WAS NOT ABLE TO PROVE THE IMMEDIATE SOURCE OF INVESTMENT IN THE PURCHASE OF LAND. THE LD. CIT(A) HELD THAT ONLY THE PROFIT OUT OF THE SAL E RECEIPT OF VARIOUS CROPS CAN BE CONSIDERED AS AVAILABLE FOR INVESTMENT AND N OT THE ENTIRE SALE RECEIPT. THEREFORE, APPLYING THE RATE OF 20% OF THE TOTAL RECEIPTS, THE LD. CIT(A) WORKED OUT PROFIT ON SALE OF AGRICULTURAL PR ODUCE AND CONFIRMED THE BALANCE ADDITION. IN THIS CASE, WE NOTICED THA T THERE IS NO DISPUTE AS TO THE FACTS THAT SOURCE OF INVESTMENT IN THE AGRICULT URAL LAND IS OUT OF THE AGRICULTURAL INCOME EARNED BY THE FAMILY OUT OF THE ANCESTRAL AGRICULTURAL LAND AT VILLAGE CHADAWAD. ACCORDING TO THE ASSESSEE , THIS LAND IS FULLY IRRIGATED IN WHICH VARIOUS CROPS LIKE, WHEAT, DHANI YA, SARSO, SOYABEAN, LAHSUN ETC. ARE CULTIVATED. THE LD.AR OF THE ASSESS EE HAS DRAWN OUR ATTENTION THROUGH LETTER DATED 06-09-2016 (PBP 6) A ND EXPLAINED THAT GENERALLY THE CULTIVATION OF CROPS IS DONE TWICE IN THE YEAR IN ADDITION TO THE SEASONABLE VEGETABLES. THE VEGETABLES AND LAHSU N ARE SOLD IN LOCAL MARKET/ VEGETABLE MANDI FOR WHICH IS IT NOT PRACTIC ALLY POSSIBLE TO GET THE SALE RECEIPTS. HOWEVER, ON THE CONTRARY, THE CROPS LIKE SARSO, SOYAABEAN, ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 12 WHEAT, TILLI ETC. IS SOLD IN KRISHI MANDI SAMITI TH ROUGH ADHATIYA FOR WHICH THE MANDI RECEIPTS ARE AVAILABLE. THE DETAILS OF SU CH RECEIPTS ARE AVAILABLE. FY RECEIPT EVIDENCE FROM LEDGER OF ARTIYA MADHAV LAL BADRI LAL & SONS (IN RS.) RECEIPT EVIDENCE FROM KRISHIMANDI PARCHI (IN RS.) TOTAL PB PG 2010-11 DETAILS NOT AVAILABLE 3,75,744/- 3,75,744/- 11 2011-12 6,93,594/- 2,52,912/- 9,46,506/- 8 & 11 2012-13 3,27,035/- 1,87,543/- 5,14,578/- 8 & 11 2013-14 (UPTO 16.12.13) 2,57,126/- 61,450/- 3,18,576/- 9 & 12 TOTAL 12,77,755/- 8,77,649/- 21,55,404/- 3.5 ALL THE ABOVE EVIDENCES ARE ONLY AN INDICATION OF THE AGRICULTURAL INCOME OF THE ASSESSEE AND THE ABOVE DETAILS DO NOT INCLUDE THE SALE OF LAHSUM AND VEGETABLES WHICH ARE SOLD IN THE LOCAL M ARKET. THUS THE AVERAGE INCOME FROM SALE OF LAHSOON ACCORDING TO TH E ASSESSEE PER BIGHA COMES TO RS. 30,000/- TO RS. 35,000/- PER BIGHA I.E . RS. 9.00 LACS TO 10.00 LACS PER ANNUM. SIMILARLY, THE REALIZATION ACCORDIN G TO THE ASSESSEE, FROM SALE OF VEGETABLES IS ALSO RS. 30,000/- TO RS. 40,0 00/- PER BIGHA I.E. RS. 9.00 LACS TO RS. 12.00 LACS PER ANNUM. THEREFORE, A FTER TAKING INTO CONSIDERATION THE AGRICULTURAL EXPENSES AND HOUSEHO LD EXPENSES, THE NET SAVINGS FROM THE AGRICULTURE IN THE CASE OF THE ASS ESSEE IS APPROXIMATELY RS. 10.00 LACS PER ANNUM WHICH IS AROUND RS. 25,000 /- TO RS. 30,000/- PER BIGHA AND IT IS QUITE REASONABLE. WE NOTICE THAT TH E LD. CIT(A) HAS ONLY CONSIDERED THE AGRICULTURAL INCOME AS PER LEDGER AC COUNT OF THE ASSESSEE IN THE BOOKS OF MADHAV LAL BADRI LAL & SONS BUT HAS NOT CONSIDERED THE ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 13 EVIDENCE OF AGRICULTURAL CROP SOLD DIRECTLY THROUGH VIKRAY PARCHI AMOUNTING TO RS. 8,77,649/-. APART FROM ABOVE, THE LD. CIT(A) HAS ALSO NOT CONSIDERED THE SALE OF LAHSOON/ VEGETABLES WHIC H ARE SOLD IN THE LOCAL MARKET/ VEGETABLES MARKET FOR WHICH KRISHI VIKRAYA PARCHI WAS NOT GENERATED. APART FROM ABOVE, THE LD. CIT(A) HAS CON SIDERED THAT FOR EARNING AGRICULTURAL INCOME, 80% IS INCURRED IN EXP ENSES WHICH ACCORDING TO US IS NOT QUITE REASONABLE. IT IS AN UNDISPUTED FACT THAT THE ASSESSEE BELONGS TO AN AGRICULTURAL FAMILY AND INVOLVES IN T HE AGRICULTURAL ACTIVITIES THEMSELVES. THEREFORE, WE ARE IN AGREEMENT WITH TH E SUBMISSION OF THE ASSESSEE THAT EXPENDITURE ON AGRICULTURE IS HARDLY 40% AS ENTIRE FAMILY MEMBERS ARE INVOLVED IN THE AGRICULTURAL ACTIVITIES . THEREFORE, IN SUCH CIRCUMSTANCES, THE INCOME FROM AGRICULTURE ACCORDIN G TO US SHOULD HAVE BEEN ESTIMATED AT 60% OF SALE RECEIPTS. THUS EVEN A S PER THE EVIDENCES AVAILABLE, INCOME FROM SALE OF AGRICULTURE CROP ON THE BASIS TAKEN BY LD. CIT(A) WORKS OUT AT RS. 12,93,242/- WHICH IS 60% O F RS. 21,55,404/-. 3.6 AFTER HAVING DELIBERATED UPON THE SUBMISSIONS O F BOTH THE PARTIES AND TAKING INTO ACCOUNT THE FACTUAL POSITION OF THE PRESENT CASE, WE FOUND FROM THE RECORD THAT THE LD. CIT(A) HAD NOT ADDED/ INCLUDED THE INCOME OF THE ASSESSEE FROM SALE OF LEHSUN AND VEGETABLES. W E HAD NOTICED THAT ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 14 THE AVERAGE INCOME FROM SALE OF LEHSUN PER BIGHA CO MES TO RS. 30,000/- TO 35,000/- I.E. RS. 9.00 LACS TO RS. 10.00 LACS PE R ANNUM AND SIMILARLY THE REALIZATION FROM SALE OF VEGETABLES IS RS. 30,000/- TO RS. 40,000/- PER BIGHA I.E. RS. 9.00 LACS TO RS. 10.00 LACS PER ANNU M. THEREFORE, AFTER CONSIDERING THE AGRICULTURE EXPENSES AND THE HOUSE HOLD EXPENSES, THE NET SAVINGS FROM LEHSUN AND VEGETABLES BY THE ASSESSEE IS APPROXIMATELY RS. 10.00 LACS PER ANNUM I.E. AROUND RS. 25,000/- TO RS . 30,000/- PER BIGHA WHICH IS QUITE REASONABLE. THUS IF WE CONSIDER THE INCOME / SAVINGS OF THE ASSESSEE FOR THE LAST 04 YEARS AS HAS BEEN MENTIONE D IN THE CHART W.E.F. FOR A.Y. 2010-11 TO ASSESSMENT YEAR 2013-14 THEN IT COM ES TO APPROXIMATELY RS. 40.00 LACS AND IN THIS WAY BY CO NSIDERING THE INCOME FROM AGRICULTURE AS HAS BEEN CALCULATED IN THE PREC EDING PARA, THE BIFURCATION OF WHICH IS RS. 12,93,243/- FROM SALE O F AGRICULTURE CROP AND APPROXIMATELY RS. 40.00 LACS FROM THE SALE OF LEHSU N AND VEGETABLES FOR THE LAST 04 YEARS WHICH IS QUITE SUFFICIENT AND FUL LY EXPLAIN THE SOURCE OF INVESTMENT IN THE PURCHASE OF AGRICULTURAL LAND. 3.7 THEREFORE, IN OUR CONSIDERED VIEW, THE ASSESSEE HAS FULLY PROVED ON RECORD THE SOURCE OF INVESTMENT IN THE PURCHASE OF AGRICULTURAL LAND. THEREFORE, KEEPING IN VIEW OUR ABOVE DISCUSSIONS, W E DIRECT THE AO TO ITA NO. 278JP/2020 SHRI RAM PRASAD MEENA VS ITO, WARD 1(2), KOTA 15 DELETE THE ADDITION OF RS. 38,38,739/- AS CONFIRMED BY THE LD. CIT(A). THUS GROUND NO. 2 OF THE ASSESSEE IS ALLOWED. 4.0 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED WITH NO ORDER AS TO COST. ORDER PRONOUNCED IN THE OPEN COURT ON 03 /09/202 0. SD/- SD/- JESK LH-'KEKZ LANHI XKSLKBZ (RAMESH C. SHARMA) (SANDEEP GOSAI N) YS[KKLNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 03 /09/2020. *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT - SHRI RAM PRASAD MEENA, KOTA 2. IZR;FKHZ@ THE RESPONDENT-THE ITO, WARD- 1(2),KOTA 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR . 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 278/JP/2020} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSTT. REGISTRAR