DCIT, New Delhi V. M/s. Brisk Infrastructure and Developers Pvt. Ltd., New Delhi

ITA 3690/DEL/2014

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3508 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 8 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 28-06-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 20-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JANARDAN DASS
• Assessee Lawyers: S K GOYAL; RAKESH KHETAN
• Keywords: Business income; Income from undisclosed sources; Earning of tax free income; Additional evidence; Assessment record
• Section: 68; 143(3); 133(6); 143(1)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER I.T.A. NO. 3690 / DEL/ 201 4 A.Y. : 20 09 - 10 DCIT, CIRCLE 3(1), NEW DELHI VS. M/S BRISK INFRASTRUCTURE AND DEVELOPERS PVT. LTD. B-1/1001, VASANT KUNJ, NEW DELHI 110 070 (PAN: AACCB3672N) (ASSESSEE) (RESPONDENT) REVENUE BY : SH. JANARDAN DASS, SR. DR . ASSESSEE BY : SH. S.K. GOYAL, CA & SH. RAKESH KHETAN, CA ORDER PER H.S. SIDHU : JM THE REVENUE HAS FILED THIS APPEAL AGAINST THE IMPUGN ED ORDER DATED 31.3.2014 OF THE LD. CIT(A)-VI, NEW DELHI RELE VANT TO ASSESSMENT YEAR 2009-10. 2. THE GROUNDS RAISED IN THE APPEAL READ AS UNDER:- I) WITHOUT APPRECIATING THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS 2 ERRED IN DELETING THE ADDITION OF RS. 7,16,28,089/- MADE BY THE AO U/S. 68 OF THE I.T. ACT, 1961. II) THE APPELLANT CRAVES LEAVE FOR RESERVING THE RIGHT TO AMEND, MODIFY, ALTER, ADD OR FOREGO ANY GROUND(S) OF APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OF THIS APPEAL. 3. THE BRIEF FACTS OF THE CASE ARE THAT ASSESSEE COMPAN Y E-FILED ITS RETURN OF INCOME FOR A.Y. 2009-10 ON 30.09.2009 DECLARING AN INCOME OF RS. 57,98,660/-. SUBSEQUENTLY THE RETURN W AS PROCESSED U/S 143(1) OF THE INCOME TAX ACT, 1961 (IN SHORT AC T). NOTICE U/S 143(2) OF THE ACT DATED 23.08.2010 WAS SERVED UPON TH E ASSESSEE COMPANY SELECTING THE CASE FOR SCRUTINY. IN RESPONSE TO STATUTORY NOTICES ISSUED, THE ASSESSEE APPEARED FROM TIME TO TIM E AND FILED NECESSARY DETAILS. THE ASSESSEE COMPANY IS CARRYING ON THE BUSINESS OF DEVELOPMENT OF LAND AS DEVELOPERS, SALE/ PURCHASE OF PLOTS, DEALING IN SHARES AND AGRICULTURE ACTIVITIES SUCH AS CULTIVATING AND SELLING AGRICULTURE PRODUCE. THE AO OBSERVED THA T ASSESSEE COMPANY CLAIMED EXEMPT INCOME UNDER THE HEAD AGRICU LTURE INCOME AMOUNTING TO RS.3,56,94,754/-. WHILE CALCULATIN G NET AGRICULTURE INCOME, THE ASSESSEE COMPANY HAS SHOWN V ARIOUS EXPENSES OF RS. 3,24,07,640/- (DIRECT AND INDIRECT). TO VERIFY THE CLAIM OF AGRICULTURE INCOME, THE ASSESSEE COMPANY W AS ASKED TO 3 FURNISH VIDE NOTE SHEET ENTRY DATED18.11.2011 DETAILS O F AGRICULTURE LAND SUCH AS WHEN IT WAS PURCHASED, ITS LOCATION ETC. T HE ASSESSEE SUBMITTED DETAILS OF AGRICULTURE LAND TAKEN ON LEASE BY THE COMPANY DURING THE F.Y: 2008-09. DURING THIS FINANCIAL YEAR (2008-09), THE ASSESSEE COMPANY TOOK ON LEASE AGRICULTURE LAND MEAS URING 2100.55 ACRE FROM 136 FARMERS IN THE STATE OF ORISSA AND THE DETAILS OF THE LAND TAKEN ON LEASE WERE FILED. THE LA ND TAKEN ON LEASE WAS USED FOR AGRICULTURE ACTIVITIES BY THE ASSES SEE DURING THE YEAR UNDER ASSESSMENT. THE ASSESSEE DISCLOSED / SHO WN SALE OF AGRICULTURE PRODUCE FOR RS. 7,16,28,089/-. THE AC D ID NOT BELIEVE ABOUT THE AGRICULTURE ACTIVITIES CARRIED OUT BY THE AS SESSEE AND TO VERIFY THE SAME ON 29.11.2011, HE MADE A REQUEST FOR ENQUIRY BY ISSUING A COMMISSION TO CONCERNED AUTHORITIES AT ORIS SA THROUGH THE ADDITIONAL COMMISSIONER OF INCOME TAX, RANGE-3, NEW DELHI BY MENTIONING AS UNDER:- IN THIS CASE THE ASSESSEE HAS SHOWN HUGE AGRICULTURE INCOME. ACCORDINGLY THE DETAILS OF THE SAME WAS CALLED FOR FROM THE ASSESSEE. THE PERUSAL OF DETAILS FILED BY THE ASSESSEE REVEALS THAT ASSESSEE ENTERED INTO AN AGREEMENT WITH 136 PERSONS FOR LEASE OF LAND. SINCE THE LAND IS LOCATED IN ORISSA, THEREFORE THE DEPARTMENT OFFICERS AND 4 LAND REVENUE OFFICERS OF THE ORISSA HAS TO BE REQUESTED FOR INQUIRY REGARDING OWNERSHIP OF LAND AND ALSO OF AGRICULTURAL PRODUCE IN THAT PARTICULAR LAND FOR THE YEAR ENDING 31.03.2009. THE LIST OF PERSON ALONGWITH COPY OF AGREEMENT SUBMITTED BY THE ASSESSEE IS ENCLOSED HEREWITH FOR NECESSARY ACTION AND ISSUING OF COMMISSION TO THE OFFICERS OF ORISSA. 3.1 THE AC RECEIVED AN ENQUIRY REPORT FROM SHRI R. BEHERA, ITO WARD - 1, JEY PORE, ORISSA ON 21.12.2011 IN WHICH H E STATED THAT HE VISITED MASTIPUT TO ENQUIRE ABOUT THE ACTIVITIES OF B RISK AGRO FARMS AND HE REPLIED THAT HE MET ONE SHRI JEENABANDHU JANI, SARPANCH OF MASTIPUT VILLAGE AT THE PANCHAYAT OFFICER MASTIPUT AND A SKED ABOUT THE CULTIVATION OF AGRICULTURE LAND OF VILLAGERS BY T HE AFORESAID COMPANY. THE SARPANCH REPLIED THAT NO SUCH ACTIVITY H AS BEEN CARRIED OUT IN THE VILLAGE OF MASTIPUT. ALL THE VILLAG ERS ARE CULTIVATING THEIR OWN LAND. HE HAS ALSO MENTIONED IN HIS REPORT THA T HE MET MR. BISWASOIN TAKRI S/O MR. D.N. ISWARDEN. MR. BISWASIO N TAKRI IS THE HUSBAND OF MRS. D.N. BADASEBA. SHE IS ABOUT 58 YEAR S OF AGE. REGARDING CULTIVATION OF LAND BY BRISK AGRO FIRM, MR . BISWASOIN REPLIED AS UNDER:- 5 MRS. D.N. BADASEBA, MRS. D.N. SUBASINI LILY, MRS. D.N. CHANDRIKA RATNAVATI ESTANA AND MRS. D.N. CHRISTINA LUISI ARE FOUR SISTERS. THEY ARE HAVING AROUND FIFTY ACRES OF AGRICULTURAL LANDED PROPERTY WHICH IS AN ANCESTRAL PROPERTY. THE FOUR SISTERS ARE HAVING THEIR OWN FAMILY, HOWEVER THEY ARE CULTIVATING THE LANDS JOINTLY. THEY HAVENT SIGNED ANY AGREEMENT WITH ANY COMPANY OR ANY OUTSIDER. THEY ARE SOLELY ENJOYING THEIR OWN PROPERTY. REGARDING THE TYPES OF CROPS BEING YIELDED IN THAT AREA, I GATHERED INFORMATION THAT RAGI, ALSI, DUNGAR PADDY AND SUAN ARE PRESENTLY CULTIVATED IN THE SURROUNDINGS OF VILLAGE MASTIPUT. THE OTHER VILLAGERS PRESENT ON THE SPOT, ALSO DENIED TO HAVE SIGNED ANY AGREEMENT WITH ANY COMPANY OR PERSON WHO IS AN OUTSIDER. 3.2 IN RESPONSE TO THIS REPORT, THE A.R. OF THE ASSES SEE FILED DETAILS OF AGRICULTURE LAND TAKEN ON LEASE BY THE ASS ESSEE. HE HAS MENTIONED THAT ONLY ON THE BASIS OF REPORT OF ONE VILL AGE, NO CONCLUSION CAN BE DRAWN. HE FILED THE DETAILS OF EXP ENSES INCURRED BY THE ASSESSEE FOR CARRYING OUT AGRICULTURE ACTIVIT IES. HE ALSO FILED 6 DETAILS OF SALES OF AGRICULTURE PRODUCE ALONG WITH CER TIFICATES FROM VARIOUS SARPANCHES, REVENUE INSPECTORS, MONEY RECEI PT FOR COLLECTION OF MARKET FEES OF THE STATE OF ORISSA. HE ALSO FILED CONFIRMATION FROM PERSONS WHOSE TRACTOR WAS USED IN T HE CULTIVATION ALONG WITH CONFIRMATION FROM PARTIES TO WHOM THE SAL E WERE MADE ETC. THE AO WAS BENT UPON MAKING THE ADDITION AND HAS MENTIONED IN THE ASSESSMENT ORDER WHILE MAKING THE ADDITION THA T ASSESSEE HAS CREATED DOCUMENTARY EVIDENCES TO CLAIM EXEMPTION O F AGRICULTURE INCOME. HE HAS MENTIONED THAT EXPENSES CLA IMED AGAINST AGRICULTURE INCOME ARE NOT SUBJECT TO VERIFIC ATION, THEREFORE GROSS RECEIPTS OF RS. 7,16,28,089/- INTRODUCED BY THE ASSESSEE IN THE NAME OF AGRICULTURE RECEIPTS WAS ADDED ON THE BAS IS OF REPORT OF ONE / TWO PERSON AND FROM ONE VILLAGE ONLY, IN THE TOTAL INCOME OF THE ASSESSEE AS INCOME FROM UNDISCLOSED SOURCES AND INCOME OF THE ASSESSEE WAS ASSESSED AT RS. 7,74,26,749/- VIDE O RDER DATED 28.12.2011 PASSED U/S. 143(3) OF THE ACT. AGGRIEVE D WITH THE ASSESSMENT ORDER, THE ASSESSEE APPEALED BEFORE THE LD . CIT(A), WHO VIDE HIS IMPUGNED ORDER DATED 31.3.2014 HAS PA RTLY ALLOWED THE APPEAL OF THE ASSESSEE BY DELETING THE ADDITION OF RS. 7,16,28,089/-. AGAINST THE IMPUGNED ORDER, THE REVENU E IS IN APPEAL BEFORE THE TRIBUNAL. 7 4. LD. DR RELIED UPON THE ORDER OF THE AO AND REITE RATED THE CONTENTIONS RAISED IN THE GROUNDS OF APPEAL. HE SU BMITTED THAT DURING THE YEAR THE ASSESSEE COMPANY HAS CLAIMED EX EMPT INCOME UNDER THE HEAD AGRICULTURE INCOME AMOUNTING TO RS. 3 ,56,94,754/- AS PER ITS COMPUTATION OF INCOME. WHILE CALCULATING NET AGRICULTURAL INCOME THE ASSESSEE COMPANY HAS DISCLOSED GROSS REC EIPTS AT RS. 7,16,28,089/- AND VARIOUS EXPENSES AT RS. 3,24,07,6 40/- (DIRECT AND INDIRECT) THUS THE RATIO OF GROSS RECEIPTS AND E XPENSES COMES AT 45%. HE FURTHER SUBMITTED THAT ON PERUSAL OF DETAILS OF SALES REVEALS THAT OUT OF TOTAL SALES OF RS. 7,16,28,089/- SALES OF RS. 4,06,28,- 070/- HAS BEEN SHOWN TO M/S UMA TRADING COMPANY AND M/S KRISHNA TRADING COMPANY AND AT THE END OF THE YEAR RS . 2,07,53,625/- I.E. ALMOST 51% WAS RECOVERABLE FROM T HE PARTIES, WHICH SHOWS THAT THE FARMERS HARDLY DEAL ON CREDIT AND THAT TOO @50% IS DIFFICULT TO BELIEVE. THEREFORE, HE SUBMITTE D THAT IT IS CLEARLY PROVED THAT THE ASSESSEE HAS CREATED DOCUMENTAR Y EVIDENCES TO CLAIM EXEMPTION ON ACCOUNT OF AGRICULTUR AL INCOME. THUS THE EXPENSES CLAIMED AGAINST AGRICULTURE INCOME ARE NOT SUBJECT TO VERIFICATION THEREFORE, THE GROSS RECEIPTS OF RS. 7,16,28,089/- INTRODUCED BY THE ASSESSEE IN THE NAME OF AGRICULTURAL RECEIPTS WAS RIGHTLY ADDED IN THE TOTA L INCOME AS 8 INCOME FROM UNDISCLOSED SOURCES, WHICH DOES NOT NEE D ANY INTERFERENCE. 5. ON THE OTHER HAND, LD. COUNSEL FOR THE ASSESSEE H AS RELIED UPON THE ORDER OF THE LD. CIT(A) AND STATED THAT HE HA S PASSED A WELL REASONED ORDER WHICH DOES NOT NEED ANY INTERF ERENCE. HE SUBMITTED THAT AO HAS MADE THE ADDITION OF TOTAL RECEIPTS OF RS. 7,16,28,089/- AS UNDISCLOSED INCOME WHEREAS ASSESSE E CLAIMED EXEMPTION OF AGRICULTURE INCOME OF RS. 3,56,94,754/ -. HOWEVER, LD. CIT(A) HAS RIGHTLY DELETED THE ADDITION. HE FURTHER SUBMITTED THAT THE TOTAL LAND TAKEN ON LEASE WAS 2100.55 ACRES FROM 136 FARMERS AND LEASE DEED WITH 135 FARMERS WAS EXECUTED ON 15.1 2.2008 AND FOR ONE FARMER WAS ON 26.7.2008. ON 2911.2011 DCI T SENT A REQUEST FOR ENQUIRY TO THE CONCERNED AUTHORITIES AT OR ISSA AND ENQUIRY REPORT DATED 21.12.2011 SUBMITTED BY SH. R. B EHRA ITO, WARD-1, JEYPORE ORISSA. THE AO RELIED UPON THE STAT EMENT OF ONLY TWO PERSONS. ONE OF MR. BISWASION TAKRI WHO IS HUSBA ND OF LAND OWNER MRS. DN BADASEBA WHO FURNISHED AFFIDAVIT AND RECEIVED PAYMENT OF RS. 24905/- VIDE CHEQUE NO. 217116 DATED 10.2.2009 AND CLEARED ON 26.2.2009. HE FURTHER SUBMITTED THAT OT HER PERSON WAS SH. JEENA BANDHU JANI, SARPANCH OF VILLAGE MUSTI PUT. HE WAS NOT ONE OF THE 136 LANDOWNERS WHO LATER ON CONFIRMED V IDE CERTIFICATE THAT ONE COMPANY NAMED BRISK AGRO FARMS C ULTIVATED 9 VEGETABLES IN THE AREA OF VILLAGE MUSTIPUT. THE ASS ESSEE SUBMITTED ITS REPLY OF ENQUIRY REPORT CONSISTING OF REPLY, AF FIDAVIT FROM VARIOUS LAND OWNERS, CERTIFICATE FROM VILLAGE SARPANCHES, MO NEY RECEIPT FOR PAYMENT OF VEGETABLES FROM MARKET COMMITTEES, CERTIF ICATE REGARDING USE OF TRACTOR, CONFIRMATION REGARDING PUR CHASE OF VEGETABLES FROM UMA TRADING CO., FROM KRISHNA TRADI NG CO., AND OTHER BUYERS, VEGETABLES WISE SALES ACCOUNT PHASE-2. IT WAS FURTHER SUBMITTED THAT INCOME OF THE ASSESSEE COMPANY IN AY 2010-11 WAS ALSO COMPRISING INCOME FROM AGRICULTURE ACTIVITIE S AND AGRICULTURE INCOME WAS RS. 12,94,14,114/-, WHICH WA S ACCEPTED BY THE DEPARTMENT VIDE ASSESSMENT ORDER DATED 03.1.2013. IN SUPPORT OF HIS CONTENTION, HE FILED A PAPER BOOK CONTAINING PAGES 1-503 IN WHICH HE HAS ATTACHED THE STATEMENT OF FACTS AND ARGUME NTS; ACKNOWLEDGEMENT OF ITR, COMPUTATION OF INCOME ETC. ; C OPY OF BALANCE SHEET BRISK AGRO FARMS; REPLY OF ASSESSEE T O ENQUIRY REPORT; COPYO F REMAND REPORT DATED 14.3.2014; COPY O F REPLY TO THE REMAND REPORT DATED 26.3.2014; COPY OF LETTERS DATED 8.8.2011, 8.10.2011, 9.11.2011, 28.11.2011, 1.12.2011 AND 12. 12.2011; COPY OF AGREEMENT TO LEASE OF AGRICULTURE LAND BY DN BADASEBA OF VILLAGE MASTIPUT; BANK STATEMENT OF SBI SHOWING PAYME NT OF RS. 24,905/-; AGREEMENT TO LEASE OF AGRICULTURE LAND B Y SOME OF THE LAND LORD; COPY OF LEASE AGREEMENTS DETAILS OF 136 F ARMERS 10 STATEMENT SHOWING THE NAME, ADDRESS, NAME OF VILLAGE, TEHSIL KATHA NUMBER, AREA OF LAND AND AMOUNT PAID FOR TAKIN G THE LAND ON LEASE; COPY OF LETTER DATED 15.12.2011 SENT BY M/S UMA TRADING COMPANY TO ACIT CIRCLE 3(1), NEW DELHI FOR PURCHASIN G VEGETABLES OF RS. 2,30,00,960/- FROM M/S BRISK AGRO FARMS AND MAKING PAYMENT OF RS. 1,43,47,875/-; COPY OF LEDGER ACCOUN T OF UMA TRADING COMPANY; COPY OF LETTER DATED 15.12.2011 SE NT BY M/S KRISHNA TRADING COMPANY TO ACIT, CIRCLE 3(1), NEW DELHI; COPY OF LEDGER ACCOUNT OF KRISHNA TRADING COMPANY; COPY OF L EDGER ACCOUNT OF MAJOR OM PRAKASH SANDEEP KUMAR SAINI, DEVAKAR A NIL KUMAR SAINI, PRADEEP KUMAR, PEHLAD KUMAR SAINI, SHANTI SWA ROOP SUNIKL KUMAR SAINI TO WHOM CRDIT SALES WERE MADE IN ADDITI ON TO UMA TRADING CO AND KRISHNA TRADING CO; COPY OF LEDGER A CCOUNTS SHOWING SALE OF AGRICULTURE PRODUCE IN TWO PHASES AL ONGWITH COPY OF LEDGER ACCOUNT OF BRINJAL, CABAAGE, CAPCIUM, CARROT, CAULIFLOWER, FRENCHBIN, GREEN CHILLI, ONION, RADISH TOMATO FOR S ALES PRODUCED IN PHASE-II; COPY OF ACCOUNT OF VEGETABLES SOLD IN PHASE I, IN BERHAMPUR AND KORAPUT; DETAILS OF EXPENSES INCURRED BY THE COMPANY ON SEEDS, PESTICIDES, MANURE, DIESEL, LABOUR CHARGES, TRANSPORTATION, CESS AND COPY OF THEIR LEDGER ACCOUNT; DETAILS OF CASH AND CREDIT SALES; VILLAGE WISE AND CROP WISE DETAILS OF EXPENSES AND SALES, HEAD WISE COST AND PRODUCT WISE COST. 11 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RE CORDS, ESPECIALLY THE IMPUGNED ORDER PASSED BY THE LD. CIT (A) AND THE PAPER BOOK FILED BY THE ASSESSEE AND THE ASSESSMENT O RDER DATED 3.1.2013 FOR THE AY 2010-11 IN ASSESSEES OWN CASE. WE FIND THAT LD. CIT(A) HAS ELABORATELY DISCUSSED THE ISSUE IN D ISPUTE VIDE PARA NO. 5 TO 5.1.3 AT PAGE NO. 27-32 OF THE IMPUGNED ORDE R DATED 31.3.2014. FOR THE SAKE OF CLARITY, WE ARE REPRODUCI NG HEREUNDER THE SAID RELEVANT FINDINGS OF THE LD. CIT(A). 5. DECISION IN APPEAL- I HAVE CAREFULLY CONSIDERED THE SUBMISSION OF THE APPELLANT. I HAVE ALSO GONE THROUGH THE RELEVANT ORDERS PASSED IN THIS CASE. BEFORE TAKING DECISION ON GROUND WISE APPEAL, IT WOULD BE APPROPRI ATE TO CONSIDER THE REMAND REPORT OF THE AO AND REJOINDER TO THE REMAND REPORT FILED BY THE APPELLANT ON THIS GROUND OF APPEAL. 5(A) THE AO HAS SUBMITTED IN HIS REMAND REPORT ON FILING OF ADDITIONAL EVIDENCE BY THE APPELLANT UNDER RULE 46A, AS BELOW: KINDLY REFER TO YOUR OFFICE LETTER NO.CIT(A)/REMAND REPORT/2013-14/535 DATED 29.10.2013 ADDRESSED TO THE UNDERSIGNED FOR SENDING THE COMMENTS ON THE COPIES OF LEDGER ACCOUNTS OF VARIOUS CONCERNS/INDIVIDUALS, TO WHOM 12 THE APPELLANT HAS SOLD ON CREDIT BASIS, AGRICULTURAL PRODUCE DURING THE F.Y. 2008-09 AMOUNTING TO RS.4,28,43,545/- AFTER VERIFICATION FROM RECORDS. IN ORDER TO VERIFY THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION, INFORMATION U/S 133( 6) OF THE I.T. ACT WERE CALLED FROM THE FOLLOWING PARTIES: 1. SHREE KANT MISHRA PROP. C/O UMA TRADING COMPANY 2. SHRI SEWA LAI S/O RAGHURAJ YADAVA PROP. M/S KRISHNA TRADING CO. 3. SHRI DIVAKAR ANIL KUMAR SAINI 4. SHANTI SARUP SUNIL KUMAR SAINI 5. PRADEEP KUMAR PRAHLAD KUMAR SAINI 6. MAJOR OM PRAKASH SANDEEP KUMAR SAINI IN REPLY TO THE INFORMATION CALLED FOR U/S 133(6), T HE ABOVE MENTIONED PARTIES SUBMITTED THEIR COPY OF BANK ACCOUNT, COPY OF LEDGER ACCOUNT AND IN SOME CASES CO PIES OF ITR. THE PARTIES MENTIONED AT SR. NO.3, 5 & 6 ABOVE HAS N OT FILED COPY OF ITRS. THE PARTY MENTIONED AT SR. NO. 6 H AS STATED THAT ITS INCOME IS BELOW TAXABLE. ON PERUSAL OF LEDGER ACCOUNT AS WELL AS ASSESSMENT RECORD IT IS FOUND THAT THERE IS CREDIT SALES IN RES PECT 13 OF M/S KRISHAN TRADING AND M/S UMA TRADING WHILE TH ERE IS NO CREDIT IN RESPECT OF REMAINING PARTIES. ON PERUSAL OF BANK STATEMENTS FILED IN RESPONSE TO NO TICE U/S 133(6), IT IS NOTICED THAT THE SALE PROCEEDS REC EIVED BY THE ASSESSEE ARE OUT OF CASH DEPOSITED OF SIMILAR AMOUNT. HOWEVER, TO VERIFY THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS, SUMMONS WERE ISSUED TO THE ABOVE MENTIONED PARTIES FOR PERSONAL DEPOSITIO N ALONG WITH DOCUMENTARY EVIDENCE FOR THE SOURCE OF CAS H DEPOSITED, BEFORE ISSUING CHEQUE TO THE ASSESEE. . IN RESPONSE THERETO NONE ATTENDED NOR HAVE ANY SUBMISSIONS BEEN FILED. IN VIEW OF THE ABOVE FACTS, LD. CIT(A) IS REQUESTED TO DECIDE THE APPEAL OF THE APPELLANT ACCORDINGLY. 5(B) THE APPELLANT IN ITS SUBMISSION BY WAY OF REJOI NDER TO THE REMAND REPORT STATED AS BELOW: THE ASSESSEE HAS MADE TOTAL SALE OF RS. 7,16,28,089 /- DURING THE UNDER ASSESSMENT. PARTY WISE DETAILS OF SA LE MADE IS AS UNDER:- M/S UMA TRADING COMPANY - RS. 2,30,00,960 M/S KRISHNA TRADING COMPANY- RS. 1,76,27,110 14 M/S DIWAKAR ANIL KUMAR SAINI - RS. 5,44,000 M/S PRADEEP KUMAR PRAHLAD KUMAR RS. 5,21,675/- M/S OM PRAKASH SANDEEP KUMAR- RS. 4,62,400/- M/S SHANTI SWARUP SUNIL KUMAR- RS. 6,87,400/- BALANCE SALE IS MADE IN CASH. OUT OF THE ABOVE PARTIE S EXCEPT UMA TRADING COMPANY AND KRISHAN TRADING COMPANY CLEARED THERE BALANCE DURING THE YEAR UNDER ASSESSMENT. THE ASSESSEE FILED LEDGER COPY OF ALL TH E ABOVE MENTIONED PARTIES BEFORE THE AO DURING ASSESSMENT PROCEEDINGS. THE HONABLE CIT APPEAL WANTED TO VERIFY FROM THE AO WHETHER THE ASSESSEE HAS SUBMITTED LEDGER COPY OF THESE PARTIES DURING ASSESSMENT PROCEEDINGS OR NOT. SIR, THE AO HAS CONFIRMED ON SECOND PAGE THAT ALL THE ABOVE MENTIONED PARTIES HAVE SUBMITTED COPY OF LEDGER ACCOUNT OF M/S BRISK AGRO IN THEIR BOOKS OF ACCOUNTS. THE AO HAS N OT POINTED OUT ANY DIFFERENCE ETC. IN THE STATEMENT SUBMITTED BY THE PARTIES IN RESPONSE TO NOTICE U/S 13 3(6) AND SUBMITTED DURING ASSESSMENT PROCEEDINGS. HE HAS ALSO MENTIONED THAT FROM THE PERUSAL OF LEDGER ACCOUN T AS WELL AS ASSESSMENT RECORD THERE IS CREDIT SALE IN RESPECT OF UMA TRADING COMPANY AND KRISHNA TRADING 15 COMPANY AND THERE IS NO BALANCE OUTSTANDING IN ANOTHER ACCOUNTS. SIR, THE AO CLEARLY CONFIRMED THAT ASSESSEE HAS FILED LEDGER ACCOUNTS OF THESE PARTIES DURING ASSESS MENT PROCEEDINGS ALSO. AS REGARDS THAT PARTIES DID NOT ATTEND IN RESPONSE TO NOTICE ISSUED FOR PERSONAL DEPOSITION, PLEASE NOTE TH AT NO NOTICE ISSUED BY THE AO WAS RECEIVED BACK. IT CLEARLY SHOWS THAT ADDRESS OF THE PARTIES IS GENUINE. THE AO ISSUED ONLY ONE NOTICE. IF THEIR PRESENCE WAS SO NECESSARY THEN HE SHOULD HAVE FOLLOWED THE MATTER FURTHER BUT HE DID NOT DO SO, LOOKS THAT HE WAS SATISFI ED WITH THE PAPERS/DOCUMENTS FILED BY THE PARTIES. WE ARE SURE THAT FROM THE ABOVE YOU WILL AGREE AND APPRECIATE THAT ALL THE PARTIES CONFIRMED THEIR TRANSACTI ON BY FILING COPY OF LEDGER ACCOUNTS AND OTHER DOCUMENT S. WE HOPE THAT YOU WILL FIND THE ABOVE IN ORDER. 5(C) CONSIDERING THE SUBMISSION OF THE APPELLANT & TO ARRIVE AT A CORRECT TAXABLE INCOME IN THE CASE OF T HE APPELLANT, THE ADDITIONAL EVIDENCE WHICH ARE MORE OF THE NATURE OF SUPPLEMENTARY EVIDENCES ARE HEREBY ADMITTED FOR ADJUDICATION PURPOSES. 16 5.1.1. IT IS CONTENDED THAT THE ORDER OF THE AO IN MAKING ADDITION OF RS.7,16,28,089/- AS INCOME FROM UNDISCLOSED SOURCES, WHICH WAS SHOWN BY THE APPELLAN T AS AGRICULTURAL RECEIPTS, ONLY ON THE BASIS OF STATEME NT OF ONE OR TWO PERSONS AND FROM ONLY ONE VILLAGE IS HIGH LY OBJECTIONABLE & THEREFORE, THE ORDER PASSED IS A BIASE D ONE & IS TOTALLY WRONG, BAD IN LAW & NEEDS TO BE QUAS HED. 5.1.2. THE APPELLANT COMPANY IS CARRYING ON THE BUSINESS OF DEVELOPMENT OF LAND AS DEVELOPERS, SALE/PURCHASE OF PLOTS, CULTIVATING & SELLING AGRIC ULTURAL PRODUCTS & DEALING IN SHARES. IT CLAIMED AGRICULTURAL INCOME AMOUNTING TO RS.3,56,94,754/- AS EXEMPT INCOME U/S 10 OF THE ACT, AS PER ITS COMPUTATION FOR F.Y. 2008-09, RELEVANT TO THE A.Y. 2009-10. WHILE CALCULAT ING NET AGRICULTURAL INCOME, THE ASSESSEE COMPANY HAS DISCLOSED GROSS RECEIPTS OF RS.7,16,28,089/- & CLAI MED VARIOUS EXPENSES AT RS.3,24,07,640/- (DIRECT & INDIRE CT) & THEREFORE, THE N.P. RATIO IS WORKED OUT AT 45.24% APPROXIMATELY ON SUCH AGRICULTURAL INCOME. ON BEING ASKED, THE ASSESSEE COMPANY FILED DETAILS OF LAND, THAT THE ASSESSEE COMPANY USED FOR CULTIVATION ALONG WITH NAMES, ADDRESSES OF FARMERS FROM WHOM THE LANDS WER E 17 TAKEN ON LEASE FOR AGRICULTURAL PURPOSES ALONG WITH MASTIPUT TEHSIL, KHATA NO. AREA ETC. IT ALSO SUBMITTED COPIES OF LEASE DEED EXECUTED ON DECEMBER 15, 2008 WITH THE 136 FARMERS. THE ASSESSEE COMPANY ALSO SUBMITTED COPIES OF OWNERSHIP DOCUMENTS IN RESPECT O F LESSORS AND ALSO STATED THAT LAND RENT/CESS/REVENUE TAX ETC WAS TO BE PAID BY THE LESSOR AS PER THE LAND LEASE AGREEMENT (CLAUSE NO.6). THE AO, HOWEVER, ISSUED COMMISSION TO THE CONCERNED AUTHORITIES AT ORISSA & G OT AN ENQUIRY REPORT, CONDUCTED BY THE LOCAL INCOME TA X OFFICE AT JEYPORA, ORISSA, BASED ON ITO/ITI REPORT WH ERE THE LOCAL ENQUIRIES AT VILLAGE MASTIPUT REVEAL THAT TW O PERSONS HAVING CONFIRMED THAT THE NO SUCH CULTIVATION ACTIVITY WAS UNDERTAKEN BY THE APPELLANT COMPANY. ONE OF THEM HAPPENED TO BE SARPANCH SH. JEENABANDHU JANI OF THE VILLAGE MASTIPUT, WHO HAS HOWEVER FURNISHED A CERTIFICATE DATED 28.12.2011 THROUGH THE APPELLANT COMPANY BEFORE THE AO, STATING THAT VARIOUS VEGETABLE S LIKE GOBI, BRINJAL, SHIMLA MIRCH & TOMATO ETC ARE BE ING GROWN IN THE VILLAGE MASTIPUT & ITS SURROUNDING AREAS FOR SO MANY YEARS & ONE COMPANY NAMED BRISK AGRO FARMS DID CULTIVATE VEGETABLES IN THE VILLAGE MASTIPUT. HE NCE, 18 NOT SUCH CREDENCE CAN BE GIVEN TO HIS STATEMENT. THE OTHER PERSON WHO THE INSPECTOR OF INCOME TAX, MET WITH MR. BISWASION TAKRI S/O SH. D.N. ISWARDAN, WHO HAPPENED TO BE THE HUSBAND OF MRS. D.N. BADASEBA, WHO STATED THAT MRS. D.N. BADASEBA (SPOUSE), MRS. D.N. SUBASINI LILY, MRS. D.N. CHANDRIKA RATNAVATI ESTANA & MRS. D.N. CHRISTINA LULSI ARE FOUR SISTER WHO ARE H AVING APPROXIMATELY FIFTY ACRES OF LAND AS AGRICULTURAL PRO PERTY, THROUGH HAVING THEIR OWN RESPECTIVE FAMILIES, HOWEVER , HAVE BEEN CULTIVATING THE LANDS JOINTLY & THAT THEY HAVE NOT SIGNED ANY AGREEMENT WITH ANY COMPANY OR OUTSIDER . HOWEVER, THE I.T.I RECORDED THE STATEMENT OF THE HUSBAND OF MRS. D.N. BADNSEBA & WHAT PRECLUDED HIM FROM RECORDING STATEMENT OF THE LESSOR HERSELF IS NO T CLEVER. IN ANY CASE, EVEN MRS. D.N. BADASEBA HAS HE RSELF FURNISHED A DULY SWORN AFFIDAVIT TO THE EFFECT THAT S HE DID EXECUTE LEASE DEED AGREEMENT DATED 15.12.2008 WITH THE APPELLANT COMPANY & RECEIVED A SUM OF RS.24,905/- VIDE CHEQUE NO.217116 WHICH COULD NOT BE CONTROVERT ED BY THE ASSESSING OFFICER. THEREFORE, THE STATEMENT GIVE N BY MR. BISWASION TAKRI IS NOT RELIABLE & MOREOVER, TH ERE MIGHT BE CONFUSION IN HIS MIND AS THE APPELLANT UNDER 19 TOOK CULTIVATION IN THE F.Y. 2008-09, WHILE THE STATEM ENT OF THE TWO PERSONS WERE RECORDED BY ITI IN THE F.Y. 2011- 12 I.E. AFTER APPROXIMATELY THREE YEARS. THE ASSESSI NG OFFICER ALSO RELIED UPON EXTRACTS OF DOWNLOADS FROM WWW.KZNDAE.GOV.ZA/LINK CLICK ASPX? FILETICKET FOR LEN GTH OF GROWING PERIOD FOR CROPS & EFFECTS OF TEMPERATURE & ALSO EXTRACTS DOWNLOADED FROM ORISSA TOURISM SITE R EG. CLIMATE IN ORISSA & IT HAS BEEN MENTIONED IN ORISSA TOURISM SITE THAT WINTER IS NOT VERY SEVER EXCEPT IN SO ME AREAS IN KORAPUT (TEHSIL KORAPUT IN WHICH MASTIPUT M ANJA EXISTS) & PHULBANI WHERE MINIMUM TEMPERATURE MAY DROP TO 3-4C & CROPS SUCH AS CABBAGE, LETTUCE, ONION & POTATO, THE ENTIRE CROPS MIGHT BE READY FOR HARVESTIN G WITHIN A FEW DAYS, BUT USUALLY DOWN OVER A LONGER PER IOD. MOREOVER, THE APPELLANT HAD TAKEN THE TOTAL AREA AS PER LEASE AGREEMENT OF 2100.55 ACRES BY SIGNING LEASE AGREEMENT WITH 136 FARMERS. THE AO ALSO RELIED UPON A NEWS ARTICLE FROM NATIONAL DAILY THE HINDU WITH A CAPTIONED TITLE THIS FARMER EARNS RS.22 LAKH A YEAR FROM 2.1 ACRES OF LAND IN DODDABALLAPUR, BANGALORE SUBUR B. GOING BY AO ANALOGY, ASSESSEE COULD HAVE EARNED OVE R 220 CRORES ION A YEAR. THEREFORE NOT MUCH RELIANCE C AN 20 BE PLACED ON SUCH ARTICLES & DOWNLOADS WHICH ARE IN EFFECT SUPPORTING THE CASE OF APPELLANT ONLY. MOREOV ER, THE APPELLANT HAS CITED & NUMBER OF DOCUMENTARY EVIDENCE IN SUPPORT OF THE CLAIM. 5.1.3 FURTHER, THE ASSESSEE HAS MADE TOTAL SALE OF RS . 7,16,28,089/- DURING THE UNDER ASSESSMENT. PARTY WISE DETAILS OF SALE MADE IS AS UNDER:- M/S UMA TRADING COMPANY - RS. 2,30,00,960 M/S KRISHNA TRADING COMPANY- RS. 1,76,27,110 M/S DIWAKAR ANIL KUMAR SAINI - RS. 5,44,000 M/S PRADEEP KUMAR PRAHLAD KUMAR RS. 5,21,675/- M/S OM PRAKASH SANDEEP KUMAR- RS. 4,62,400/- M/S SHANTI SWARUP SUNIL KUMAR- RS. 6.87,400/- RS.4,28,43,545/- BALANCE SALE OF APPROX. 40% IS MADE IN CASH. OUT OF THE ABOVE PARTIES, EXCEPT M/S UMA TRADING COMPANY AND KRISHAN TRADING COMPANY THE OTHER CONCERNS CLEARED THERE BALANCE DURING THE YEAR UNDER ASSESSMENT. THE ASSESSEE STATED TO HAVE FILED RELEVANT DETAILS OF ALL THE ABOVE MENTIONED PARTIES BEFORE THE AO DURING ASSESSMENT PROCEEDINGS. FOR VERIFICATION PURPOSES AND AS TO WHETHER THE APPELLANT HAS FILED NECESSARY DETAILS AND 21 HAS SUBMITTED LEDGER COPY OF THESE PARTIES DURING ASSESSMENT PROCEEDINGS OR NOT, THE COPIES OF LEDGER ACCOUNTS OF VARIOUS CONCERNS/INDIVIDUALS TO WHOM APPELLANT HAS SOLD ON CREDIT BASIS AGRICULTURAL PRODU CE DURING F.Y. 08-09 AMOUNTING TO RS.4,28,43,545/-, WER E FORWARDED TO THE AO. THE AO HAS CONFIRMED IN THE REMAND REPORT THAT ALL THE ABOVE MENTIONED PARTIES HAVE SUBMITTED COPY OF LEDGER ACCOUNT OF M/S BRISK AGRO IN THEIR BOOKS OF ACCOUNTS, COPY OF BANK STATEME NTS AND IN SOME CASES, COPIES OF ITRS. THE AO HAS IN FA CT, NOT POINTED OUT ANY DIFFERENCE ETC. IN THE STATEMENT SUBMITTED BY THE PARTIES IN RESPONSE TO NOTICE U/S 13 3(6) AND THE DETAILS SUBMITTED DURING ASSESSMENT PROCEEDINGS. HE HAS ALSO MENTIONED THAT FROM THE PERUSAL OF LEDGER ACCOUNT AS WELL AS ASSESSMENT REC ORD, THERE IS CREDIT SALE IN RESPECT OF UMA TRADING COMPANY AND KRISHNA TRADING COMPANY AND THERE IS NO BALANCE OUTSTANDING IN OTHER ACCOUNTS. AS REGARDS THE FACT THAT PARTIES DID NOT ATTEND IN RESPONSE TO NOTICE ISSUED FOR PERSONAL DEPOSITION, IT IS SEEN THAT NO NOTICE ISSUED BY THE AO WAS RECEIVED BACK UNDELIVERED. IT SHOWS THAT ADDRESSES OF THE PARTIES A RE 22 GENUINE. HOWEVER, THE FACT REMAINED THAT THEY DID NOT RESPOND TO THE SUMMONS ISSUED BY THE ASSESSING OFFI CER, PARTICULARLY IN REGARD TO THE VERIFICATION OF IDENTITY CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS INCLUDING THE BANKING TRANSACTIONS. HOWEVER, THEY HAVE CONFIRMED THE SAID TRANSACTIONS WITH OTHER EVIDENCES. MOREOVER, THE AO HAS NOT MADE ANY OTHER INDEPENDENT ENQUIRY TO DISPROVE THE IDENTITY, CAPACITY AND GENUINENESS OF SUCH TRANSACTIONS, AS ESTABLISHED BY THE RESPECTIVE LEDGER ACCOUNTS FILED BY THE SAID PARTIES, BANK STATEMENT AND IN SOME CASES, COPIES OF ITRS AS WELL. THEREFORE, THE DISSATISFACTION RECORDED BY THE AO IN TH IS REGARD IS PRIMARILY BASED ON SURMISES AND CONJECTUR ES AND NOT ON THE BASIS OF PROPER APPRAISAL OF EVIDENCE AND THEREFORE, NOT ON THE BASIS OF SUFFICIENT RECORDS. TH E ACTION OF THE ASSESSING OFFICER IS ALSO NOT JUSTIFIED MERELY ON INSPECTORS REPORT REGARDING NON CONDUCT OF AGRICULTURAL OPERATIONS BY THE APPELLANT COMPANY IN THE YEAR UNDER APPEAL, AS THE CONTENTS OF THE SAID REPORT HAVE BEEN EFFECTIVELY CONTROVERTED BY THE APPELLANT COMPANY & WHICH HAS NOT BEEN OUT RIGHTLY REJECTED BY THE AO. THEREFORE, ADDITION ON ACCOUNT OF AGRICULTURAL 23 RECEIPTS AS HAS BEEN TREATED BY THE AO AS INCOME FROM UNDISCLOSED SOURCES IS FOUND TO BE BASED ON UNSUBSTANTIATED MATERIAL ON RECORD & THEREFORE, CANNOT BE SUSTAINED, PARTICULARLY WHEN THE ASSESSEE HAS FIL ED THE RELEVANT DETAILS WITH EVIDENCE BEFORE THE AO IN AN EFFECTIVE MANNER. THEREFORE, THE PLEA OF THE APPELLAN T IS ACCEPTED & THE AO IS HEREBY DIRECTED TO DELETE THE ADDITION OF RS.7,16,28,089/- ON ACCOUNT OF HIS TREATI NG SUCH INCOME AS INCOME FROM UNDISCLOSED SOURCES. 6.1 AFTER PERUSING THE AFORESAID FINDINGS OF THE LD. CIT(A), WE ARE OF THE VIEW THAT ASSESSEE COMPANY IS CARRYING ON THE BUSINESS OF DEVELOPMENT OF LAND AS DEVELOPERS, SALE/PURCHASE OF PLOTS, CULTIVATING & SELLING AGRICULTURAL PRODUCTS & DEALIN G IN SHARES. IT CLAIMED AGRICULTURAL INCOME AMOUNTING TO RS.3,56,94,7 54/- AS EXEMPT INCOME U/S 10 OF THE ACT, AS PER ITS COMPUTATIO N FOR F.Y. 2008-09, RELEVANT TO THE A.Y. 2009-10. WHILE CALCULA TING NET AGRICULTURAL INCOME, THE ASSESSEE COMPANY HAS DISCLO SED GROSS RECEIPTS OF RS.7,16,28,089/- & CLAIMED VARIOUS EXPE NSES AT RS.3,24,07,640/- (DIRECT & INDIRECT) & THEREFORE, THE N.P. RATIO WAS WORKED OUT AT 45.24% APPROXIMATELY ON SUCH AGRICULTUR AL INCOME. ON BEING ASKED, THE ASSESSEE COMPANY FILED DETAILS O F LAND, THAT THE ASSESSEE COMPANY USED FOR CULTIVATION ALONG WITH NAME S, ADDRESSES 24 OF FARMERS FROM WHOM THE LANDS WERE TAKEN ON LEASE FOR AGRICULTURAL PURPOSES ALONG WITH MASTIPUT TEHSIL, KHATA NO. AREA ETC . IT ALSO SUBMITTED COPIES OF LEASE DEED EXECUTED ON DECEMBER 1 5, 2008 WITH THE 136 FARMERS. THE ASSESSEE COMPANY ALSO SUBMI TTED COPIES OF OWNERSHIP DOCUMENTS IN RESPECT OF LESSORS AND ALSO STATED THAT LAND RENT/CESS/REVENUE TAX ETC WAS TO BE PAID BY THE L ESSOR AS PER THE LAND LEASE AGREEMENT (CLAUSE NO.6). THE AO, HOWE VER, ISSUED COMMISSION TO THE CONCERNED AUTHORITIES AT ORISSA & GO T AN ENQUIRY REPORT, CONDUCTED BY THE LOCAL INCOME TAX OFFICE AT J EYPORA, ORISSA, BASED ON ITO/ITI REPORT WHERE THE LOCAL ENQUIRIES AT VILLAGE MASTIPUT REVEAL THAT TWO PERSONS HAVING CONFIRMED THAT THE N O SUCH CULTIVATION ACTIVITY WAS UNDERTAKEN BY THE APPELLANT COMPANY. ONE OF THEM HAPPENED TO BE SARPANCH SH. JEENABANDHU JANI OF THE VILLAGE MASTIPUT, WHO HAS HOWEVER FURNISHED A CERTIFI CATE DATED 28.12.2011 THROUGH THE ASSESSEE COMPANY BEFORE THE A O, STATING THAT VARIOUS VEGETABLES LIKE GOBI, BRINJAL, SHIMLA M IRCH & TOMATO ETC ARE BEING GROWN IN THE VILLAGE MASTIPUT & ITS SURROUND ING AREAS FOR SO MANY YEARS & ONE COMPANY NAMED BRISK AGRO FARMS DID CULTIVATE VEGETABLES IN THE VILLAGE MASTIPUT. HENCE, NO T SUCH CREDENCE CAN BE GIVEN TO HIS STATEMENT. THE OTHER PER SON WHO THE INSPECTOR OF INCOME TAX, MET WITH MR. BISWASION TAKRI S/O SH. D.N. ISWARDAN, WHO HAPPENED TO BE THE HUSBAND OF MRS. D.N. BADASEBA, 25 WHO STATED THAT MRS. D.N. BADASEBA (SPOUSE), MRS. D.N. SUBASINI LILY, MRS. D.N. CHANDRIKA RATNAVATI ESTANA & MRS. D. N. CHRISTINA LULSI ARE FOUR SISTER WHO ARE HAVING APPROXIMATELY F IFTY ACRES OF LAND AS AGRICULTURAL PROPERTY, THROUGH HAVING THEIR OWN RESP ECTIVE FAMILIES, HOWEVER, HAVE BEEN CULTIVATING THE LANDS JOI NTLY & THAT THEY HAVE NOT SIGNED ANY AGREEMENT WITH ANY COMPANY OR OUTSIDER. HOWEVER, THE I.T.I RECORDED THE STATEMENT OF THE HUSBAND OF MRS. D.N. BADNSEBA & WHAT PRECLUDED HIM FROM RECORDING ST ATEMENT OF THE LESSOR HERSELF IS NOT CLEVER. IN ANY CASE, EVEN MRS. D.N. BADASEBA HAS HERSELF FURNISHED A DULY SWORN AFFIDAV IT TO THE EFFECT THAT SHE DID EXECUTE LEASE DEED AGREEMENT DATED 15.12. 2008 WITH THE ASSESSEE COMPANY & RECEIVED A SUM OF RS.24,905/- VIDE CHEQUE NO.217116 WHICH COULD NOT BE CONTROVERTED BY THE ASSES SING OFFICER. THEREFORE, THE STATEMENT GIVEN BY MR. BISWASIO N TAKRI IS NOT RELIABLE & MOREOVER, THERE MIGHT BE CONFUSION IN HIS MIND AS THE ASSESSEE UNDER TOOK CULTIVATION IN THE F.Y. 2008-09, WHILE THE STATEMENT OF THE TWO PERSONS WERE RECORDED BY ITI IN THE F.Y. 2011- 12 I.E. AFTER APPROXIMATELY THREE YEARS. WE FURTHER N OTE THAT THE ASSESSING OFFICER ALSO RELIED UPON EXTRACTS OF DOWNL OADS FROM WWW.KZNDAE.GOV.ZA/LINK CLICK ASPX? FILETICKET FOR LE NGTH OF GROWING PERIOD FOR CROPS & EFFECTS OF TEMPERATURE & ALSO EXT RACTS DOWNLOADED FROM ORISSA TOURISM SITE REG. CLIMATE IN ORISSA & IT HAS 26 BEEN MENTIONED IN ORISSA TOURISM SITE THAT WINTER IS NOT VERY SEVER EXCEPT IN SOME AREAS IN KORAPUT (TEHSIL KORAPUT IN WHI CH MASTIPUT MANJA EXISTS) & PHULBANI WHERE MINIMUM TEMPERATURE MA Y DROP TO 3-4C & CROPS SUCH AS CABBAGE, LETTUCE, ONION & POTATO , THE ENTIRE CROPS MIGHT BE READY FOR HARVESTING WITHIN A FEW DAYS, BUT USUALLY DOWN OVER A LONGER PERIOD. MOREOVER, THE APPELLANT HA D TAKEN THE TOTAL AREA AS PER LEASE AGREEMENT OF 2100.55 ACRES B Y SIGNING LEASE AGREEMENT WITH 136 FARMERS. THE AO ALSO RELIED UPON A NEWS ARTICLE FROM NATIONAL DAILY THE HINDU WITH A CAPTION ED TITLE THIS FARMER EARNS RS.22 LAKH A YEAR FROM 2.1 ACRES OF LA ND IN DODDABALLAPUR, BANGALORE SUBURB. GOING BY AO ANALOG Y, ASSESSEE COULD HAVE EARNED OVER 220 CRORES IN A YEAR. THEREF ORE NOT MUCH RELIANCE CAN BE PLACED ON SUCH ARTICLES & DOWNLOADS WHICH ARE IN EFFECT SUPPORTING THE CASE OF ASSESSEE ONLY. MOREOVER , THE ASSESSEE HAS CITED NUMBER OF DOCUMENTARY EVIDENCE IN SUPPORT OF THE CLAIM. FURTHER, THE ASSESSEE HAS MADE TOTAL SALE OF RS. 7,1 6,28,089/- DURING THE UNDER ASSESSMENT. PARTY WISE DETAILS OF S ALE MADE IS AS UNDER:- M/S UMA TRADING COMPANY - RS. 2,30,00,960 M/S KRISHNA TRADING COMPANY- RS. 1,76,27,110 M/S DIWAKAR ANIL KUMAR SAINI - RS. 5,44,000 M/S PRADEEP KUMAR PRAHLAD KUMAR RS. 5,21,675/- M/S OM PRAKASH SANDEEP KUMAR- RS. 4,62,400/- M/S SHANTI SWARUP SUNIL KUMAR- RS. 6.87,400/- RS.4,28,43,545/- 27 6.1.1 WE FURTHER NOTE THAT THE BALANCE SALE OF APPRO X. 40% IS MADE IN CASH. OUT OF THE ABOVE PARTIES, EXCEPT M/S UMA TRAD ING COMPANY AND KRISHAN TRADING COMPANY THE OTHER CONCERNS CLEARE D THERE BALANCE DURING THE YEAR UNDER ASSESSMENT. THE ASSESSE E STATED TO HAVE FILED RELEVANT DETAILS OF ALL THE ABOVE MENTION ED PARTIES BEFORE THE AO DURING ASSESSMENT PROCEEDINGS. FOR VERIFICATI ON PURPOSES AND AS TO WHETHER THE APPELLANT HAS FILED NECESSARY DETAILS AND HAS SUBMITTED LEDGER COPY OF THESE PARTIES DURING ASSESSM ENT PROCEEDINGS OR NOT, THE COPIES OF LEDGER ACCOUNTS OF V ARIOUS CONCERNS/INDIVIDUALS TO WHOM ASSESSEE HAS SOLD ON C REDIT BASIS AGRICULTURAL PRODUCE DURING F.Y. 08-09 AMOUNTING TO RS.4,28,43,545/-, WERE FORWARDED TO THE AO. THE AO H AS CONFIRMED IN THE REMAND REPORT THAT ALL THE ABOVE MENTIONED PARTI ES HAVE SUBMITTED COPY OF LEDGER ACCOUNT OF M/S BRISK AGRO IN THEIR BOOKS OF ACCOUNTS, COPY OF BANK STATEMENTS AND IN SOME CAS ES, COPIES OF ITRS. THE AO HAS IN FACT, NOT POINTED OUT ANY DIFFERE NCE ETC. IN THE STATEMENT SUBMITTED BY THE PARTIES IN RESPONSE TO NOTICE U/S 133(6) OF THE ACT AND THE DETAILS SUBMITTED DURING ASSESSMEN T PROCEEDINGS. AO HAS ALSO MENTIONED THAT FROM THE PERUSAL OF LEDGER ACCOUNT AS WELL AS ASSESSMENT RECORD, THERE IS CREDIT SALE IN RESPECT OF UMA TRADING COMPANY AND KRISHNA TRADING COMPANY AND THE RE IS NO BALANCE OUTSTANDING IN OTHER ACCOUNTS. AS REGARDS TH E FACT THAT 28 PARTIES DID NOT ATTEND IN RESPONSE TO NOTICE ISSUED FO R PERSONAL DEPOSITION, IT IS SEEN THAT NO NOTICE ISSUED BY THE AO WAS RECEIVED BACK UNDELIVERED. IT SHOWS THAT ADDRESSES OF THE PAR TIES ARE GENUINE. HOWEVER, THE FACT REMAINED THAT THEY DID NOT RESPOND TO THE SUMMONS ISSUED BY THE ASSESSING OFFICER, PARTICU LARLY IN REGARD TO THE VERIFICATION OF IDENTITY CREDITWORTHINESS AND GE NUINENESS OF THE TRANSACTIONS INCLUDING THE BANKING TRANSACTIONS. HOWEVER, THEY HAVE CONFIRMED THE SAID TRANSACTIONS WITH OTHER EVIDE NCES. MOREOVER, THE AO HAS NOT MADE ANY OTHER INDEPENDENT ENQ UIRY TO DISPROVE THE IDENTITY, CAPACITY AND GENUINENESS OF SUCH TRANSACTIONS, AS ESTABLISHED BY THE RESPECTIVE LEDGER ACCOUNTS FILED BY THE SAID PARTIES, BANK STATEMENT AND IN SOME CASES , COPIES OF ITRS AS WELL. THEREFORE, THE DISSATISFACTION RECORDED BY THE AO IN THIS REGARD IS PRIMARILY BASED ON SURMISES AND CONJE CTURES AND NOT ON THE BASIS OF PROPER APPRAISAL OF EVIDENCE AND THER EFORE, NOT ON THE BASIS OF SUFFICIENT RECORDS. THE ACTION OF THE ASS ESSING OFFICER WAS ALSO NOT JUSTIFIED MERELY ON INSPECTORS REPORT RE GARDING NON CONDUCT OF AGRICULTURAL OPERATIONS BY THE ASSESSEE C OMPANY IN THE YEAR UNDER APPEAL, AS THE CONTENTS OF THE SAID REPORT HAVE BEEN EFFECTIVELY CONTROVERTED BY THE ASSESSEE COMPANY AND WHICH HAS NOT BEEN OUT RIGHTLY REJECTED BY THE AO. THEREFORE, ADDI TION ON ACCOUNT OF AGRICULTURAL RECEIPTS AS HAS BEEN TREATED BY THE AO AS 29 INCOME FROM UNDISCLOSED SOURCES WAS FOUND TO BE B ASED ON UNSUBSTANTIATED MATERIAL ON RECORD AND THEREFORE, CAN NOT BE SUSTAINED, PARTICULARLY WHEN THE ASSESSEE HAS FILED THE RELEVANT DETAILS WITH EVIDENCE BEFORE THE AO IN AN EFFECTIVE MA NNER. THEREFORE, LD. CIT(A) HAS RIGHTLY ACCEPTED THE PLEA OF THE ASSESSEE AND DIRECTED THE AO TO DELETE THE ADDITION OF RS.7,16,2 8,089/- ON ACCOUNT OF HIS TREATING SUCH INCOME AS INCOME FROM UNDISCLOSED SOURCES, WHICH DOES NOT NEED ANY INTERFERENCE ON O UR PART, THEREFORE, WE UPHOLD THE ACTION OF THE LD. CIT(A) ON TH E ISSUE IN DISPUTE AND REJECT THE GROUND RAISED BY THE REVENUE. 7. IN THE RESULT, THE REVENUES APPEAL STANDS DISMI SSED ORDER PRONOUNCED ON 26/02/2019. SD/- SD/- [N.K. BILLAIYA] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 26/02/2019 SRBHATNAGAR COPY FORWARDED TO: - 1. ASSESSEE - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES