SHRI SATINDER SINGH KHANDPURE, Khandwa V. THE ACIT CIRCLE, Khandwa

ITA 360/IND/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5670 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 4 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-10-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 22-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MOHMD JAVED
• Section: 143(3); 14A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE .., .., % BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER SHRI SATINDER SINGH KHANDPURE P/O M/S. CENTRAL MOTORS, PANDHANA ROAD KHANDWA PAN:ATQPS2322E VS. ACIT CIRCLE KHANDWA / APPELLANT / RESPONDENT & ' / APPELLANT BY SHRI PRAKASH JAIN, CA )*& ' / RESPONDENT BY SHRI MOHMD. JAVED, SR. (DR) / DATE OF HEARING 21.09.2016 / DATE OF PRONOUNCEMENT 19.10.2016 / O R D E R PER O. P. MEENA, ACCOUTANT MEMEBR. . . ./ I.T.A. NO.360/IND/2015 $& & / ASSESSMENT YEAR:2010-11 IN,O 360/IND/2015/A.Y.10-11/SH SATINDER SINGH KHAND PURE PAGE 2 OF 7 1. THIS APPEAL IS FILED BY THE ASSESSEE IS DIRECTED AG AINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS)-II, INDORE (HEREINAFTER REFERRED TO AS THE LD. CIT (A)) DATED 30.01.2015. THIS APPEAL PERTAINS TO ASSESSMENT YEAR 2010-11. THIS APPEAL ARISES OUT OF ASSESSMENT ORDER DTD. 01. 03.2013 PASSED U/S. 143(3) OF INCOME TAX ACT, 1961 [HEREIN AFTER REFERRED TO AS 'THE ACT) BY THE ACIT KHANDWA [HER EINAFTER REFERRED TO AS THE AO]. 2. GROUND NO.1 IS GENERAL IN NATURE AND DOES NOT REQUI RE ADJUDICATION AND ALSO NOT PRESSED, HENCE, TREATED A S DISMISSED. 3. GROUND NO. 2 RELATES TO DISALLOWANCE OF RS. 2,258/- UNDER SECTION 14A READ WITH RULE 8D, WHICH IS NOT PRESSED, HENCE, TREATED AS DISMISSED. 4. GROUND NO. 3 STATES THAT LD. CIT (A) HAD ERRED IN C ONFIRMING THE REDUCTION OF AGRICULTURAL INCOME FROM RS. 15,60 ,000/- TO RS.10,68,410/- AND AGRICULTURAL INCOME TREATED AS I NCOME FROM OTHER SOURCES AT RS. 4,91,590/- WHICH IS WRONG , ILLEGAL AND UNWARRANTED. IN,O 360/IND/2015/A.Y.10-11/SH SATINDER SINGH KHAND PURE PAGE 3 OF 7 5. SUCCINCTLY, FACTS OF THE CASE ARE THAT THE ASSESSEE IS INDIVIDUAL, DERIVES AS SHARE INCOME FROM PARTNERSHIP FIRM AND AGRICULTURAL INCOME. THE ASSESSEE HAS SHOWN AGRICULT URAL INCOME AT RS. 15,60,000/-. THE AO FOUND FROM DETAIL S THAT THE ASSESSEE HAS SOLD WHEAT AND SOYABEAN TO PRIVATE PERS ON OUT OF MANDI @2500/- AND RS. 3,500/- PER QUINTAL RESPECTIV ELY, WHEREAS MAXIMUM SALE RATE AS PER MANDI RATE WAS RS. 1 165/- AND RS. 2240/-RESPECTIVELY. THUS THE ASSESSEE HAS SHOWN AGRICULTURAL INCOME OF RS. 1, 15,560/- BY HIGHER SI DE AS PER WORKING GIVEN IN THE CHART IN THE ASSESSMENT ORDER. ACCORDINGLY, IT WAS DISALLOWED. THE AO FURTHER FOUN D THAT THE ASSESSEE HAS MADE ON SPOT SALES OF RS. 6 LAKHS FOR WHICH NO EVIDENCE FILED HENCE, IT WAS ALSO DISALLOWED. THUS T OTAL SALES DISALLOWED WORKED OUT AT RS.7,15,560/- . THE AO NOTE D THAT THE AVERAGE EXPENSES SHOWN BY THE ASSESSEE COMES 31. 3% ON AGRICULTURAL EARNINGS. ACCORDINGLY, THE AO COMPUTED DISALLOWANCE OUT OF AGRICULTURAL INCOME AT RS. 4,91, 590/- (17,15,560 - 2,23,970/ BEING 31.3% EXPENSES ON EARN ING AGRICULTURAL INCOME) AND TREATED THE SAME AS INCOME FROM IN,O 360/IND/2015/A.Y.10-11/SH SATINDER SINGH KHAND PURE PAGE 4 OF 7 OTHER SOURCES AND REDUCED THE AGRICULTURAL INCOME A T RS. 10,68,410/-. 6. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFOR E THE LD. CIT (A). THE LD. CIT (A) HAS CONFIRMED THE DISALLOWANCE BY OBSERVING THAT THE ASSESSEE HAS NOT CONTROVERTED TH E FINDING OF THE A.O. 7. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFO RE THIS TRIBUNAL. BEFORE US, THE LEARNED COUNSEL FOR THE AS SESSEE SUBMITTED THAT THE ASSESSEE IS HOLDING 40 ACRES OF IRRIGATED AGRICULTURAL LAND AND HOLDING OF FAMILY IS 133 ACRE S AGRICULTURAL LAND. THE ASSESSEE HAS SHOWN ON SPOT SA LES OF VEGETABLES, WHEAT AND SOYABEAN ETC. AT RS. 6,00,000/ - WHICH INCLUDED SALE TO AGRICULTURIST OF RS. 2,55,750/- . OUT OF WHICH, THE AO DISALLOWED RS. 1,15,560/- AND ADDED RS. 4,91 ,590/- AGGREGATING TO RS. 10,68,410/- AND AFTER REDUCING 3 1.3% EXPENSES AT RS. 2,93,030/- NET AGRICULTURAL INCOME OF RS.4,91,590/- WAS DISALLOWED. THEREFORE, IT WAS SUBMI TTED THAT AS PER AGRICULTURAL LAND HOLDING AGRICULTURAL INCOME PER ACRES COMES TO RS. 37,555/- WHICH IS REASONABLE CONS IDERING THE IRRIGATED LAND AND USE OF TRACTORS AND MACHINER Y. IN,O 360/IND/2015/A.Y.10-11/SH SATINDER SINGH KHAND PURE PAGE 5 OF 7 HOWEVER, THE MANDI BILLS ARE NOT AVAILABLE BUT THE ASSESSEE HAS FILED CONFIRMATION FOR AGRICULTURIST FOR THE SA LE MADE TO THEM BEFORE THE AO. IN SUPPORT OF HIS PROPOSITION T HE LEARNED COUNSEL FOR THE ASSESSEE ALSO CITE SOME CASE LAWS V IZ: NEELAM PATNI 17 TTJ 135 (MP-IND) AND ANIL KUMAR PACHORI 18 TTJ108 (MP-JBL) WHERE AGRICULTURAL INCOME SHOWN WAS ACCEPTED ON THE BASIS OF CONFIRMATION FILED BY THE ASSESSEE`S. 8. THE LD. SENIOR (DR) VEHEMENTLY SUPPORTED THE ORDER OF LOWER AUTHORITIES, AND SUBMITTED THAT NO BOOKS OF ACCOUNT S FOR AGRICULTURAL PRODUCE IS MAINTAINED AND INCOME IS BE ING SHOWN ON ESTIMATE BASIS. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE GONE T HROUGH THE ORDERS OF THE LOWER AUTHORITIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSEE HAS SHOWN AGRICULTURAL INCOME SALES AT RS. 15,60,000/- WHICH I NCLUDES RS.6,00,000/- INCLUDING RS.2,55,750/-BEING SALES OF WHEAT AND SOYABEAN SHOWN AT HIGHER PRICE AS COMPARED TO MA NDI SALES. THESE SALES ARE IN THE NATURE OF ON SPOT SAL ES MADE EFFECTED OUTSIDE MANDI TO PRIVATE PARTIES. WE FIND THAT THE ASSESSEE HAS AGRICULTURAL LAND HOLDING AT 40 ACRES OF IRRIGATED IN,O 360/IND/2015/A.Y.10-11/SH SATINDER SINGH KHAND PURE PAGE 6 OF 7 AGRICULTURAL LAND. THE ASSESSEE HAS ALSO FILED CONF IRMATION OF PARTIES I.E. AGRICULTURIST, TO WHOM SALES WAS MADE. THEREFORE, CONSIDERING THE CIRCUMSTANCES AND IN ABSENCE OF BOO KS OF ACCOUNTS IN RESPECT OF AGRICULTURAL PRODUCE BEING N OT MAINTAINED AND CASE LAWS AS RELIED ON BY THE ASSESSE E, IT WOULD BE REASONABLE TO ESTIMATE 30% OF THE SALES AMO UNTING TO RS.6,00,000/- TO PRIVATE PARTIES AS NON-EXPLAIN ED AGRICULTURAL INCOME WHICH WOULD BE WORKED OUT TO RS. 1,80,000/-. ACCORDINGLY, THE ADDITION OF RS. 1,80,0 00/- IS CONFIRMED AND THE BALANCE ADDITION OF RS.3,11,590/- I.E. [RS.4,91,590- RS. 1,80,000] IS DELETED. THIS GROUND OF APPEAL IS THEREFORE, PARTLY ALLOWED. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTL Y ALLOWED. 11. THE ORDER PRONOUNCED IN THE OPEN COURT ON 19-10-2 016 SD/- ( . . ) (D.T.GARASIA) JUDICIAL MEMBER SD/- ( . . ) (O.P.MEENA) ACCOUNTANT MEMBER IN,O 360/IND/2015/A.Y.10-11/SH SATINDER SINGH KHAND PURE PAGE 7 OF 7 + / DATED : 19 TH OCTOBER, 2016.OPM