Shri Ramnik Patel, Dist.Navsari V. The Income tax Officer,Ward-3, Navsari

ITA 323/AHD/2007

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 2022 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-12-2009
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 15-12-2009
• Assessment Year: 2003-2004
• Appeal Filed On: 18-01-2007
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Section: 143(1); 143(2)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'A' (BEFORE S/SHRI T K SHARMA AND SHRI D C AGARWAL) ITA NO.323/AHD/2007 (ASSESSMENT YEAR:- 2003-04) SHRI RAMNIK PATEL, SAHYOG SOCIETY, COLLEGE ROAD, AT. KHUNDH, TALUKA: CHIKHLI, DISTRICT: NAVSARI V/S THE INCOME-TAX OFFICER, WARD-3, NAVSARI [APPELLANT] [RESPONDENT] APPELLANT BY :- SHRI TUSHAR HEMANI RESPONDENT BY:- SHRI ANAND MOHAN, SR. DR O R D E R PER D C AGARWAL (ACCOUNTANT MEMBER): THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEAR NED COMMISSIONER OF INCOME-TAX (APPEALS) WHEREIN HE HAS CONFIRMED AN ADDITION OF RS.3,81,790/- AS INCOME FROM UNEXPLA INED SOURCE WHEREAS THE ASSESSEE HAD DECLARED THE SAME AS AGRIC ULTURAL INCOME. 2 THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS ALSO CONFIRMED AN ADDITION OF RS.90,000/- FOR L OW HOUSEHOLD EXPENSES. 3 DURING THE COURSE OF ASSESSMENT PROCEEDINGS U/S 143(2) / 143(3), THE LEARNED ASSESSING OFFICER NOTI CED THAT THE 2 ASSESSEE HAS DECLARED AN AGRICULTURAL INCOME OF RS. 3,81,790/- BUT HE DID NOT FURNISH ANY DETAILS IN RESPECT OF VARIOU S EXPENSES AND RECEIPTS. NO TRADING ACCOUNT, P&L ACCOUNT OR BALANC E-SHEET IN RESPECT OF AGRICULTURAL ACTIVITIES WAS FURNISHED. I T WAS EXPLAINED TO THE LEARNED ASSESSING OFFICER THAT NO RECORD FOR EXPENDITURE INCURRED ON CULTIVATION IS MAINTAINED BY THE ASSESS EE, AS THE LAND WAS GIVEN FOR TILLING / CULTIVATION TO A PERSON ON HATHBATAI WHO USED TO PASS ON THE NET RECEIPTS. THUS, THE ASSESSE E WAS GETTING ONLY NET INCOME. HE SUBMITTED THAT THE ASSESSEE HAD 3.62.20 HECTORS OF LAND AND WAS JOINTLY OWNED WITH HIS BROT HER SHRI JAYANTIBHAI. IN ADDITION, THE ASSESSEE POSSESSED .6 1 HECTOR AND .43 HECTOR, THE LAND AT DIFFERENT PLACES WITH 1/3 RD SHARE. IN ADDITION, HE HAD 1/6 TH SHARE IN 9.86 HECTORS OF LAND AT VILLAGE DERDI. REGARDING THE NATURE OF CROP, IT WAS SUBMITT ED THAT IT WAS GROWING SUGAR, GARLIC, COTTON, GROUND-NUTS BUT IN A BSENCE OF DETAILS OF CULTIVATION EXPENDITURE AND RECEIPTS, TH E LEARNED ASSESSING OFFICER REJECTED THE CLAIM OF AGRICULTURA L INCOME AND TREATED THE SUM OF RS.3,81,790/- AS NON-AGRICULTURA L INCOME. 4 THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) NOTICED THAT ALL THE PIECES OF LAND ARE LOCATED AT THREE DIFFERENT PLACES FAR FROM EACH OTHER. NO DETAILS OF CROPS CUL TIVATED WERE FURNISHED. EVEN THOUGH SOME DETAILS OF SALE OF GOL WERE FURNISHED BUT THE DETAILS OF MANUFACTURING GOL WERE ALSO NOT PROVIDED. EVEN THOUGH THE LEARNED AR POINTED OUT TO THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) THAT THE LEARN ED ASSESSING OFFICER ESTIMATED THE INCOME OF AGRICULTU RE AT RS.1,00,500/- AND ONLY RS.2,21,275/- BEING THE DIFF ERENCE SHOULD 3 HAVE BEEN ADDED IN THE TOTAL INCOME AND THE LEARNED ASSESSING OFFICER ERRED IN MAKING THE ADDITION OF ENTIRE AGRI CULTURAL INCOME BUT THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS ) DID NOT GIVE ANY FINDING ON ESTIMATION OF AGRICULTURAL INCO ME. ACCORDINGLY, HE CONFIRMED THE ADDITION. 5 BEFORE US, THE LEARNED AR FOR THE ASSESSEE SUBMI TTED THAT THE AGRICULTURAL INCOME HAS BEEN ACCEPTED IN T HE PAST BY THE DEPARTMENT AND IN SUBSEQUENT YEARS AS UNDER: AY AGRICULTURAL INCOME IN RS. STATUS OF ASSESSMENT 2000-01 374780 143(1) 2001-02 399050 143(1) 2002-03 333430 143(1) 2003-04 381790 143(1) 2004-05 132384 143(1) 2005-06 307731 143(1) 2006-07 198870 143(1) SECONDLY, THE ESTIMATION MADE BY THE LEARNED ASSESS ING OFFICER ON THE BASIS OF DATA PROCURED FROM AGRICULTURAL UNI VERSITY WAS FINALLY IGNORED AND ENTIRE ADDITION WAS MADE WHICH WAS CONFIRMED BY THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) WITHOUT GIVING THE BENEFIT OF SUCH ESTIMATION. THE LEARNED AR THEN SUBMITTED THAT IT WAS NOT POSSIBLE TO GIVE THE DETAILS OF INCOME AND EXPENDITURE BECAUSE THE ASSESSEE HAS REC EIVED THE NET INCOME FROM THE PERSON TO WHOM THE LAND WAS GIVEN F OR 4 CULTIVATION ON SHARING BASIS. HE ACCORDINGLY PRAYED FOR TREATING THE ENTIRE AGRICULTURAL INCOME AS SUCH. 6 AGAINST THIS, THE LEARNED DR RELIED ON THE ORDE R OF THE AUTHORITIES BELOW AND SUBMITTED THAT NO DETAILS OF AGRICULTURE AND EXPENDITURE HAVE BEEN FURNISHED AND AGRICULTURAL IN COME PER HECTOR AS DECLARED BY THE ASSESSEE IS TOO HIGH WHIC H IS NOT PRACTICALLY POSSIBLE PARTICULARLY WHEN THE LAND IS CULTIVATED ON SHARING BASIS, AS CLAIMED BY THE ASSESSEE. 7 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL ON RECORD. IN ABSENCE OF ANY DETAILS O F AGRICULTURAL RECEIPTS AND EXPENDITURE, IT IS NOT POSSIBLE TO ACC EPT THE CLAIM OF THE ASSESSEE THAT IT HAS EARNED AGRICULTURAL INCOME TO THE EXTENT AS CLAIMED. IN THE AY 2004-05, THE ASSESSEE HAS SHO WN ONLY AGRICULTURAL INCOME AT RS.1,32,384/-. THERE IS NO E XPLANATION AS TO WHY AGRICULTURAL INCOME IN AY 2004-05 IS LOWER A ND IN OTHER YEARS IT IS HIGH. SINCE THE FACT OF ASSESSEE HOLDIN G THE AGRICULTURAL LAND IS NOT DISPUTED AND THE DEPARTMEN T SEEMS TO HAVE NOT TAKEN ANY ACTION AGAINST THE AGRICULTURAL INCOME CLAIMED BY THE ASSESSEE IN PRECEDING YEARS, THERE IS A CASE FOR ESTIMATING THE AGRICULTURAL INCOME TO SOME EXTENT. SINCE THE L EARNED ASSESSING OFFICER HAS IN HIS ASSESSMENT ORDER ESTIM ATED THE AGRICULTURAL INCOME AT RS.1,00,500/- AS PER PAGE-6 OF HIS ORDER, WE CONSIDER IT REASONABLE TO ESTIMATE THE AGRICULTU RAL INCOME AT RS.1,25,000/-. BALANCE SHOULD BE TREATED AS NON-AGR ICULTURAL INCOME. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 5 8 THE NEXT ISSUE IS ABOUT THE HOUSEHOLD EXPENDITUR E ESTIMATED BY THE LEARNED ASSESSING OFFICER. WE HAVE HEARD THE LEARNED AR AND THE LEARNED DR. IN ABSENCE OF ANY MA TERIAL TO THE CONTRARY AND IN AND DETAILS FURNISHED BY THE ASSESS EE, WE ARE UNABLE TO TAKE A DIFFERENT VIEW THAN WHAT THE LOWER AUTHORITIES HAVE TAKEN. ACCORDINGLY, THE ESTIMATE SO MADE BY TH E LEARNED ASSESSING OFFICER IS CONFIRMED. THIS GROUND OF ASSE SSEES APPEAL IS REJECTED. 9 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT TODAY ON 23-12-2 009 SD/- SD/- (T K SHARMA) JUDICIAL MEMBER (D C AGARWAL) ACCOUNTANT MEMBER DATE : 23-12-2009 COPY OF THE ORDER FORWARDED TO : 1. SHRI RAMNIK PATEL, SAHYOG SOCIETY, COLLEGE ROAD, AT. KHUNDH, TALUKA: CHIKHLI, DISTRICT: NAVSARI 2. THE ITO, WARD3, NAVSARI 3. CIT CONCERNED 4. CIT(A)-VALSAD 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE 6 BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT, AHMEDABA