Surendra Bharat Chaugale, Chikodi V. Pr. CIT, Hubli

ITA 37/PAN/2022

AI Insights

The case involves Surendra Bharat Chaugale, an agriculturist, who filed an income tax return declaring a total income of Rs.2,90,190, primarily from agricultural activities. The Pr. CIT, Hubli, exercised revisionary powers under section 263 of the Income-tax Act, 1961, questioning the lower percentage of agricultural expenses (14.26%) claimed against the receipts, which were expected to be around 35%. The Pr. CIT set aside the original assessment order, directing a fresh assessment, alleging that the assessee had earned undisclosed income by underreporting expenses. The Tribunal, however, found that the Assessing Officer had adequately addressed this issue during the original assessment, accepting the assessee's justification for the lower expenses due to personal involvement in agricultural activities and ownership of livestock, which reduced the need for higher agricultural spending.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 136946 (ITAT-PANAJI)
• Duration Of Justice: 1 year(s) 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Appeal Filed On: 16-05-2022
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P.S. SHIVSHANKAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI (AT e-Court, PUNE) BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER आयकर अपील सं. / ITA No.37/PAN/2022 नधा रण वष / Assessment Year : 2017-18 Surendra Bharat Chaugale, Patil Galli, Khadaklat, Chikodi, Karnataka – 591 228 PAN : ALIPB7444A Vs. The Pr. CIT, Hubli Appellant Respondent आदेश / ORDER PER R.S.SYAL, VP : This appeal by the assessee arises out of the order dated 26-03-2022 passed by the Pr.CIT, Hubli u/s.263 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment year 2017-18. 2. Briefly stated, the facts of the case are that the assessee is an agriculturist who filed his return declaring total income at Rs.2,90,190/-. Such income was in respect of interest. The assessee had shown gross agricultural receipts of Rs.48,57,345/- and expenses of Rs.6,93,000/-. The AO observed that the agricultural Assessee by Shri Pramod Vaidhya Revenue by Shri P.S. Shivshankar Date of hearing 11-09-2023 Date of pronouncement 13-09-2023 ITA No.37/PAN/2022 Surendra Bharat Chaugale 2 expenses were only 14.26%, which should have been at 35%. On being show caused, the assessee furnished explanation as to how he incurred lower expenses. The AO got satisfied and did not make any addition on this score. Thereafter, the ld. Pr.CIT exercising revisionary power u/s.263 held that the assessee claimed expenses at a lower level against the agricultural receipts and consequently earned undisclosed income. He set-aside the assessment order and directed the AO to frame the assessment afresh. Aggrieved thereby, the assessee has come up in appeal before the Tribunal. 3. After considering the rival submissions and perusing the relevant material on record, it is seen that the assessee is an agriculturist and has no business income. The only other minor income is in respect of bank interest. The ld. Pr.CIT has made out a case that the assessee declared lower expenses so as to enhance the amount of agricultural income. When the view so canvassed is seen in the backdrop of the fact that the assessee, an agriculturist, was having only agricultural income and no business income, such a presumption of depressing agricultural expenses and earning undisclosed income cannot meet with our concurrence. 4. Notwithstanding the above, the assessee made detailed submissions before the AO justifying the incurring of expenses at 14.26% by stating that both he and his wife were working in the ITA No.37/PAN/2022 Surendra Bharat Chaugale 3 fields personally, having 5 buffalows and 2 cows etc. and certain other things which saved the cost of agricultural spending. The ld. Pr.CIT has not controverted any of the submissions made by the assessee before the AO. Thus, it cannot be said that the AO adopted a legally and factually unsustainable view, which could have been subjected to revisionary proceedings. We order accordingly and set- aside the impugned order. 5. In the result, the appeal is allowed. Order pronounced in the Open Court on 13 th September, 2023. Sd/- Sd/- ( S.S.VISWANETHRA RAVI) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; िदनांक Dated : 13 th September, 2023 सतीश आदेश की ितिलिप अ ेिषत/Copy of the Order is forwarded to: 1. अपीलाथ / The Appellant; 2. थ / The respondent 3. The CIT concerned 4. DR, ITAT, Panaji Bench, Panaji 5. गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune ITA No.37/PAN/2022 Surendra Bharat Chaugale 4 Date 1. Draft dictated on 11-09-2023 Sr.PS 2. Draft placed before author 12-09-2023 Sr.PS 3. Draft proposed & placed before the second member JM 4. Draft discussed/approved by Second Member. JM 5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *