Shri Manubhai Morarbhai Patel(HUF), Baroda V. The Income tax Officer,Ward-3(1), Baroda

ITA 3085/AHD/2011

• Counselvise Citation: 308520514 RSA 2011
• Duration Of Justice: 1 year(s) 9 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 07-12-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: B L YADAV
• Assessee Lawyers: URVASHI SHODHAN
• Section: 131

Judgement Text

, , , , , IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, SMC BENCH . .. . . .. . , ,, , BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER ITA NO.3085/AHD/2011 [ASSTT.YEAR : 2005-2006] MANUBHAI MORARBHAI PATEL (HUF) JASPUR ROAD, PADRA 391 440 DIST. VADODARA. PAN : AABHM 4333 H /VS. ITO, WARD-3(1) BARODA. ( (( ('# '# '# '# / APPELLANT) ( (( ($%'# $%'# $%'# $%'# / RESPONDENT) &'( ) * / ASSESSEE BY : SMT.URVASHI SHODHAN , ) * / REVENUE BY : SHRI B.L.YADAV, SR.DR -,. ) (// DATE OF HEARING : 17 TH SEPTEMBER, 2013 012 ) (// DATE OF PRONOUNCEMENT : 17 TH SEPTEMBER, 2013 3 / O R D E R THIS APPEAL OF THE ASSESSEE IS ARISING FROM THE ORD ER OF THE LEARNED CIT(A)-III, BARODA DATED 22.9.2011 FOR THE ASSESSME NT YEAR 2005-2006. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF THE APPEAL: 1. THE LD.CIT(A) ERRED IN LAW AND ON THE FACTS IN ADOPTING YIELD OF TOBACCO @ 2224 KG. PER HECTARE IN PLACE OF 2558 KG. SHOWN BY THE APPELLANT SIMPLY BY RELYING ON APPELLATE ORDER OF T HE PREVIOUS YEAR. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, LD.C IT(A) OUGHT TO HAVE DELETED THE ENTIRE ADDITION MADE BY AO TREATIN G AGRICULTURAL ITA NO.3085/AHD/2011 -2- INCOME AS INCOME FROM UNEXPLAINED SOURCES ON THE BA SIS OF SURMISES AND CONJECTURES. 2. THE LD.CIT(A) ERRED IN LAW AND ON FACTS IN CONFI RMING ACTION OF AO REFUSING TO ACCEPT YIELD FROM AGRICULTURAL LA ND TAKEN ON LEASE DESPITE LESSORS HAVING DEPOSED BEFORE AO OF RECEIVI NG LEASE RENT ON GIVING LAND ON LEASE TO THE APPELLANT. THE LD.CIT( A) REFUSED THE CLAIM THAT CROP WAS GROWN ON LAND TAKEN ON LEASE BY SIMPLY RELYING ON APPELLATE ORDER OF A.Y.2004-05. THIS ACTION OF BOTH THE LOWER AUTHORITIES IS IN CLEAR BREACH OF PRINCIPLES OF NAT URAL JUSTICE AND THEREFORE DESERVES TO BE QUASHED. 3. IN GROUND NO.1, THE BRIEF FACTS OF THE CASE ARE THAT THE LD.CIT(A) HAD ADOPTED YIELD OF TOBACCO AT THE RATE OF 2224KG. PER HECTARE IN PLACE OF 2558KG. DECLARED BY THE ASSESSEE. THE LEARNED COUN SEL FOR THE ASSESSEE, SMT. URVASHI SHODHAN ARGUED AND INVITED OUR ATTENTI ON TO PARA-4.42 OF THE LD.CIT(A)S ORDER, WHICH FOR THE SAKE OF CLARITY IS REPRODUCED AS UNDER: 4.2 I HAVE CONSIDERED THE CONTENTIONS OF THE A.O. AND THE SUBMISSIONS MADE BY THE APPELLANT. SIMILAR ISSUE WA S INVOLVED IN THE APPELLANT'S OWN CASE FOR A.Y. 2004-05. CIT (A)- II, BARODA, IN HIS APPELLATE ORDER DATED 18.12.2007 IN APPEAL NO. CAB/II- 542/06-07 HAS DIRECTED THE A.O. TO TAKE THE PRODUCT ION OF TOBACCO @ 45 MAUNDS PER HECTARE RELYING UPON THE DE CISION OF ITAT, AHMEDABAD 'C' BENCH IN THE CASE OF FATIMA I. VOHRA VS. DCIT. THIS TRANSLATES INTO 2224 KG. PER HECTARE IN PLACE OF 1800 KG PER HECTARE ADOPTED BY A.O. HENCE, FOLLOWING THE SAME, THE A.O. IS DIRECTED TO ADOPT THE YIELD OF 2224 KG/ HEC TARE AND RECOMPUTE THE AGRICULTURE INCOME OF THE APPELLANT A CCORDINGLY. THE APPELLANT GETS PARTIAL RELIEF ACCORDINGLY. 4. SHE ALSO PLACED ON RECORD ORDER OF THE ITAT, AHM EDABAD IN ASSESSEES OWN CASE IN ITA NO.990/AHD/2001 FOR A.Y. 2004-2005 DATED 27.8.2010, WHEREIN THE ITAT HAS ACCEPTED THE YIELD AT THE RATE OF 2224 KG. PER HECTARE. SHE FAIRLY CONCEDED THAT IN ASSESSEE S OWN CASE THE YIELD OF 2224 KG./HECTARE HAS BEEN ACCEPTED. THE LEARNED DR , ON THE OTHER HAND, RELIED ON THE ORDER OF THE LEARNED CIT(A) AND THE A O AND THE ORDER OF THE ITAT, AHMEDABAD CITED SUPRA. ITA NO.3085/AHD/2011 -3- 5. I HAVE HEARD RIVAL CONTENTIONS AND CONSIDERED TH E FACTS OF THE CASE. IN VIEW OF THE DECISION OF THE ITAT, AHMEDABAD (SUP RA) IN ASSESSEES OWN CASE FOR A.Y.2004-2005, ON THE ISSUE WHERE THE YIEL D OF 2224 PER KG. HAVE BEEN HELD TO BE REASONABLE, I FIND NO INFIRMITY IN THE ORDER OF THE LEARNED CIT(A), WHO HAS DIRECTED THE AO TO ADOPT YIELD OF 2 224 KG. PER HECTARE AND RECOMPUTE THE AGRICULTURE INCOME ACCORDINGLY. THUS GROUND NO.1 OF THE ASSESSEE IS DISMISSED. 6. AS REGARDS GROUND NO.2, THE BRIEF FACTS OF THE C ASE ARE THAT, THE ASSESSEE HAS DECLARED AGRICULTURE INCOME AT RS.4,94 ,131/- INCLUDING AGRICULTURE INCOME FROM TOBACCO AMOUNTING TO RS.4,0 8,555/-, AFTER INCURRING EXPENSES OF RS.57,624/-. THE AO HAS OBSE RVED THAT THE ASSESSEE HAS CULTIVATED ITS OWN LAND AS WELL AS LAND TAKEN O N LEASE. THE ASSESSEE HAS FAILED TO FURNISH DETAILS OF EXPENDITURE ALONG WITH EVIDENCES INCURRED TO CULTIVATE AND GROW THE CROP OF TOBACCO DURING THE Y EAR. THE AO OBSERVED THAT THE ASSESSEE HAS SHOWN NEGLIGIBLE EXPENSES AMO UNTING TO RS.57,624/- DURING THE IMPUGNED YEAR, AND ACCORDINGLY, THE EXPE NDITURE INCURRED FOR AGRICULTURE NEITHER COMPARABLE TO THE YIELD NOR REL IABLE. THE AO OBSERVED THAT THE ASSESSEES OWN CASE FOR A.Y.2004-2005, IT HAS BEEN OBSERVED THAT YIELD SHOWN BY THE ASSESSEE IS NOT JUSTIFIED WITH T HE EXPENSES INCURRED AS WELL AS THE DATA OF PRODUCTION PER HECTOR AVAILABLE FROM THE DEPARTMENT OF AGRICULTURE. THE AO FURTHER OBSERVED THAT THE ASSE SSEES PRODUCTION OF TOBACCO WAS IN EXCESS, AND ACCORDINGLY WORKED OUT R S.2,18,205/- AS NON- AGRICULTURE INCOME, WHICH WAS ADDED TO THE INCOME O F THE ASSESSEE DECLARED BY HIM. 7. THE CIT(A) AFTER CONSIDERING THE EXPLANATION OF THE ASSESSEE OBSERVED AS UNDER: THE APPELLANT HAS NOT PRODUCED ANY EVIDENCE DURING THE COURSE OF APPELLATE PROCEEDINGS TO REBUT THIS FINDING EXCEPT FOR MAKING A STATEMENT THAT THE IDENTITY OF THE LESSER IS NOT ITA NO.3085/AHD/2011 -4- QUESTIONED BY THE LD. A.O. FURTHER, THE APPELLANT HAD SUBMITTED, REGARDING THE A.O.'S OBSERVATION THAT HE HAD FAILED TO PROVE ACTUAL PAYMENT OF RENT TO THE LAND OWNER, THAT THE LAND OWNER WAS EXAMINED BY THE A.O. U/S 131 IN THE IMMEDIATE PREVIOUS ASSESSMENT YEAR I.E. 2004-05 AND HE HAS CONFIRMED RECEIPT OF RENT. HENCE, IT HAS BEE N CLAIMED THAT THERE IS NO MERIT IN THE OBSERVATION O F THE A.O. REGARDING THE INADEQUACY OF RENT PAID. FRO M THE RECORDS IT IS FOUND THAT THE APPELLANT'S CONTENTIONS REGARDING GROWING OF CROP ON LEASED LAND HAS NOT BEEN ACCEPTED BY THE A.O. AS WELL AS CIT (A) FOR A.Y. 2004-05 AND THE APPELLANT IS IN APPEAL BEFORE ITAT. HENCE, IN THE CURRENT YEAR TOO, IT IS HELD THAT THE APPELLANT'S CONTENTION THAT IT HAD TAKEN LAND ON LEASE FOR GROWING OF CROPS IS NOT ACCEPTABLE. ACCORDINGLY, THIS GROUND OF APPEAL IS DISMISSED. 8. THE LEARNED COUNSEL FOR THE ASSESSEE, MS.URVASHI SHODHAN ARGUED AND INVITED OUR ATTENTION TO THE ORDER OF THE ITAT IN ASSESSEES OWN CASE FOR A.Y.2004-205 THAT THE ASSESSEE HAS NOT TAKEN OR HAS NEVER DISPUTED THE ISSUE BEFORE THE CIT(A) AND NO GROUND HAS BEEN TAKE N BEFORE LD.CIT(A), AND ACCORDINGLY, THE ITAT HAS DISMISSED THE GROUND OF THE ASSESSEE. SHE FURTHER ARGUED THAT FACTS REMAIN THAT, THE SAID GRO UND WAS NOT TAKEN BY MISTAKE BEFORE THE LEARNED CIT(A), AND ACCORDINGLY, THE ITAT, AHMEDABAD IN ASSESSEES OWN CASE IN PRECEDING YEAR DISMISSED THE GROUND TAKEN BEFORE THE TRIBUNAL. BUT IN THE PRESENT CASE, THE FACTS A RE DIFFERENT, AND THE GROUND HAS BEEN TAKEN BEFORE THE LEARNED CIT(A) WHO HAS DI SMISSED THE SAME ON THE BASIS THAT THE MATTER HAS BEEN ACCEPTED BY THE LEARNED CIT(A) AS WELL AS THE AO IN THE PREVIOUS YEAR, WHEREAS, IT IS NOT THE CASE AS ARGUED HEREINABOVE. THE LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, RELIED ON THE ORDERS OF THE AUTHORITIES BELOW. 9. I HAVE CONSIDERED RIVAL CONTENTIONS AND PERUSED THE CASE OF THE ASSESSEE. ON PERUSAL OF THE ORDER OF THE ITAT, IN THE ASSESSEES OWN CASE FOR PRECEDING YEAR, AS MENTIONED HEREINABOVE, I AM CONVINCED THAT THE LEARNED COUNSEL FOR THE ASSESSEE HAS NOT AGITATED T HE GROUND BEFORE THE LEARNED CIT(A), AND ACCORDINGLY, THE ITAT HAS DISMI SSED THE GROUND OF THE ITA NO.3085/AHD/2011 -5- ASSESSEE ON THE ISSUE. BUT THE FACTS IN THE PRESEN T CASE ARE DIFFERENT, AND THE ASSESSEE HAD AGITATED THE ISSUE BEFORE THE LEARNED CIT(A) AS WELL AS BEFORE ME. THEREFORE, I HAVE TO DECIDE THE ISSUE ON MERIT ON THE BASIS OF THE FACTS AVAILABLE ON RECORD. IN THE PRESENT CASE, THE YIEL D HAS BEEN SETTLED AT 2224 PER KG./HECTARE, AS MENTIONED HEREINABOVE. ACCORDI NGLY, ON LEASED LAND ALSO, WHICH IS 2.85 HECTARES TAKEN FOR GROWING THE CROP OF TOBACCO, THE YIELD OF 2224 KGS. PER HECTARE IS DIRECTED TO BE ACCEPTED OUT OF WHICH, 25% HAS TO BE REDUCED, WHICH HAS BEEN GIVEN TO THE OWNER OF TH E LAND. THE AO IS DIRECTED TO ACT ACCORDINGLY. THIS GROUND NO.2 OF T HE ASSESSEE IS PARTLY ALLOWED. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN IT A NO.3085/AHD/2011 IS PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- ( . .. . . .. . / B.P.JAIN ) /ACCOUNTANT MEBER C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD