The ACIT, Circle-2, JAMNAGAR V. Shri Bharatsinh Bhikhubha Jadeja (HUF), JAMNAGAR

ITA 379/RJT/2011

• Counselvise Citation: [2012] 120 COUNSELVISE.COM (IT) 0060 (ITAT-RAJKOT)
• Duration Of Justice: 10 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 19-07-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 07-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AVINASH KUMAR
• Keywords: Source of fund

Judgement Text

: : IN THE INCOME TAX APPELLATE TRIBULAL: RAJKOT BENCH: RAJKOT . .. . . . . . , , , , . .. . . . . . , , , , % % % % BEFORE SHRI T. K. SHARMA, JM AND SHRI D. K. SRIVAST AVA, AM ITA NO. 379/RJT/2011 / ASSESSMENT YEAR 2007-08 ASSTT. COMMISSIONER OF INCOME-TAX V. BHARATSINH B HIKHUBHA JADEJA, HUF CIRCLE-2, JAMNAGAR JAMNAGAR PAN: AABHJ7424E ASSESSEE BY: NONE REVENUE BY: SHRI AVINASH KUMAR DATE OF HEARING: 19.7.2012 DATE OF PRONOUNCEMENT: 31.8.2012 / // / ORDER . .. . . . . . /D. K. SRIVASTAVA: THE APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) ON 21.7.2011, ON THE FOLLOWING GROUNDS: 1. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN D ELETING THE ADDITION MADE BY THE AO AMOUNTING TO RS.10,35,156/- CLAIMED BY ASSESSEE AS AGRICULTURAL INCOME.. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE AO.. 3. IT IS THEREFORE PRAYED THAT THE ORDER OF THE CIT (A) BE SET ASIDE AND THAT OF THE AO BE RESTORED 2. THE ASSESSEE IS A HINDU UNDIVIDED FAMILY (HUF). HE FILED RETURN OF INCOME ON 7.3.2008 DECLARING, INTER-ALIA, AGRICULTU RAL INCOME AMOUNTING TO RS.10,35,156/- FOR RATE PURPOSES. THE ASSESSEE CLAI MED TO OWN 46 BIGHAS OF LANDS IN THE VILLAGE OF KALAVAD TALUKA OF JAMNAGAR DISTRICT FROM WHICH HE CLAIMED TO HAVE EARNED AGRICULTURAL INCOME OF RS.10 ,35,156/-. THE AO DID NOT BELIEVE THE CLAIM OF THE ASSESSEE FOR THE REASONS G IVEN BY HIM IN THE 2 ITA NO. 379/RJT/2011 ASSESSMENT ORDER. HE THEREFORE TREATED THE SAID SUM OF RS.10,35,156/- DECLARED BY THE ASSESSEE AS AGRICULTURAL INCOME AS NON-AGRIC ULTURAL INCOME AND TAXED THE SAME ACCORDINGLY. ON APPEAL, THE LD. CIT(A) HAS DEC IDED THE ISSUE IN FAVOUR OF THE ASSESSEE WITH THE FOLLOWING OBSERVATIONS: 6. I HAVE CAREFULLY CONSIDERED THE DISCUSSIONS MADE IN THE ASSESSMENT ORDER AND THE SUBMISSIONS OF THE APPELLA NT. APPELLANT'S SOURCES OF INCOME IS FROM INTEREST AND AGRICULTURAL INCOME. FROM THE VARIOUS DETAILS SUBMITTED DURING T HE COURSE OF APPELLATE PROCEEDINGS I HAVE FOUND THAT AS PER 7/12 LAND HOLDING. OF APPELLANT IS 46 BIGHAS AGRICULTURAL LAN D VIDE SURVEY NO.287/1,287/2 & 287/3. IT IS FOUND THAT THE DISTT. AGRI. OFFICER HAS GIVEN THE DATA OF AGRICULTURAL CROPS FOR A.YS. 2008-09 AND 2009-10, WHICH THE AO USED IN THE ASSESSMENT. APPEL LANT'S ASST.YEAR UNDER CONSIDERATION IS 2007-08. DATA USED BY THE AO IS NOT RELEVANT, AS IT SHOWS AREA OF KALAVAD AREA. APPELLANT IS SHOWING AGRICULTURAL INCOME SINCE A.Y. 2002-03. UPS AND DOWNS IN INCOME SHOWN AS PER CHART. IN A.Y. 2006-07 AGRICULTURAL EXPENSES INCURRED BUT NO SALES WERE MA DE AND THE GOODS LIED UNSOLD AS STOCK (THOUGH NOT SHOWN IN PER SONAL BALANCE-SHEET). FORM 7/12 SHOWS PRODUCTION OF COTTO N & GROUNDNUT IN AY 2007-08. IT WAS FOUND THAT CROPS OF THE YEAR 2005-06 AND 2006-07 WERE SOLD DURING THE YEAR AND T HUS SHOWN HIGH AGRICULTURAL INCOME. I HAVE FOUND THAT BILLS O F SALES OF AGRICULTURAL CROPS FILED BY THE APPELLANT WERE NOT DOUBTED BY THE AO AND NO CROSS VERIFICATION OF PURCHASERS WAS MADE . 3 ITA NO. 379/RJT/2011 SUMMARILY ON THE BASIS OF AVERAGE DATA OF KALAVAD S UCH ACTION CANNOT BE JUSTIFIED. CROSS CONFIRMATION OF PURCHASE S IS AVAILABLE AND' NOT DOUBTED BY THE AO. APPELLANT HAVE NO OTHER SOURCE OTHER THAN INTEREST INCOME OR AGRICULTURAL INCOME. UNEXPLAINED INCOME CANNOT BE EARNED OUT OF AIR. APPELLANT HAVIN G NO BUSINESS ETC. CANNOT SAID BE HAVE EARNED THIS UNEXPLAINED INCOME. 7/12 GIVEN BY REVENUE AUTHORITIES WAS NOT D OUBTED OR REJECTED BY THE AO. AO HAS NOT DOUBTED LAND HOLDING OF 46 BIGHAS. AGRICULTURAL EXPENSES ARE ALSO NOT DOUBTED AS BOGUS. HENCE THERE IS NO EVASION OF DOUBTING INCOME. HONB LE ITAT, RAJKOT BENCH IN THE CASE OF SMT. BHANABEN CHIMANLAL MALVIA IN ITA' NO. 1128/RJT/2004 DTD.30-12-0S HELD AS UNDER: 'ASSESSEE HAVING SUBMITTED A COPY OF LAND RECORDS I N RESPECT OF AGRICULTURAL LAND OWNED BY HER AND SALES BILLS OF AGRICULTURAL PRODUCE SOLD BY HER, GROWING OF AGRICU LTURAL PRODUCE AND IS SALES CANNOT BE DISBELIEVED AND, THE REFORE, REASONABLE AGRICULTURAL INCOME SHOWN BY THE ASSESSE E COULD NOT BE TREATED AS INCOME FROM UNDISCLOSED SOU RCES MERELY BECAUSE ASSESSEE HAS SHOWN AGRICULTURAL INCO ME FOR THE FIRST TIME AND THE LAND RECORDS SHOW A DIFF ERENT PRODUCE THAN WHAT WAS SOLD BY ASSESSEE.' IN VIEW OF THE ABOVE JUDGMENT OF THE HON'BLE ITAT A LSO THE AGRICULTURAL. INCOME SHOWN BY THE APPELLANT' CANNOT BE TREATED AS INCOME FROM' UNDISCLOSED SOURCES. THEREFORE, THE AD DITION OF RS.I0,35,156/- MADE BY THE AO BEING UNEXPLAINED INC OME IS, 4 ITA NO. 379/RJT/2011 HEREBY ORDERED TO BE DELETED. THESE GROUNDS OF APPE AL ARE ALLOWED. 3. AGGRIEVED BY THE ORDER PASSED BY THE CIT(A), THE DEPARTMENT IS IN APPEAL BEFORE THIS TRIBUNAL. 4. THE NOTICE OF HEARING WAS SENT TO THE RESPONDENT -ASSESSEE FIXING THE APPEAL FOR HEARING FIRSTLY ON 1.5.2012 AND THEREAFT ER ON 19.7.2012. ON 1.5.2012 HEARING WAS ADJOURNED TO 19.7.2012. ON 19.7.2012, N EITHER THE ASSESSEE NOR ANYBODY ON BEHALF OF THE ASSESSEE ENTERED THE APPEA RANCE BEFORE THIS TRIBUNAL. IN THIS VIEW OF THE MATTER, THE APPEAL FILED BY THE DEPARTMENT IS BEING DISPOSED OFF ON MERITS EX-PARTE QUA THE ASSESSEE AFTER HEARI NG THE LD. DR. 5. IN SUPPORT OF APPEAL, THE LD. DR MERELY SUPPORTE D THE ORDER PASSED BY THE AO. EVEN ON REPEATED QUERIES FROM US, HE COULD NOT POINT OUT ANY FACTUAL AND/OR LEGAL ERROR IN THE IMPUGNED ORDER OF THE CIT(A). 6. WE HAVE HEARD THE LD. DR, PERUSED THE ORDERS PAS SED BY THE AO AND CIT(A) AND ALSO THE MATERIALS AVAILABLE BEFORE US. THOUGH THE ASSESSEE CLAIMED TO POSSESS 46 BIGHAS OF LAND, HE COULD NOT HOWEVER ESTABLISH BEFORE THE AO THAT HE HAD CARRIED OUT PRIMARY AGRICULTURAL OPERATIONS OR ACTUALLY GENERATED AGRICULTURAL INCOME TO THE EXTENT CLAIMED BY HIM. T HE AO HAS TREATED THE AGRICULTURAL INCOME SHOWN BY THE ASSESSEE AS NON-AG RICULTURAL INCOME AND TAXED THE SAME ACCORDINGLY. THERE IS NO EVIDENCE ON RECOR D THAT THE ASSESSEE HAD GENERATED NON-AGRICULTURAL INCOME OF RS.10,35,156/- IN THE YEAR UNDER APPEAL. IF THE CLAIM OF THE ASSESSEE REGARDING AGRICULTURAL IN COME WAS FOUND TO BE INCORRECT OR HIS CLAIM IN THIS BEHALF WAS TO BE DIS BELIEVED, THE AO IN THAT CASE COULD HAVE REJECTED THE CLAIM OF THE ASSESSEE REGAR DING GENERATION OF 5 ITA NO. 379/RJT/2011 AGRICULTURAL INCOME AND RESULTANTLY IGNORED IT AND CONSEQUENTLY TAKEN NIL AGRICULTURAL INCOME. IT WAS NOT OPEN TO HIM TO TREA T THE AGRICULTURAL INCOME SHOWN BY THE ASSESSEE AS NON-AGRICULTURAL INCOME WITHOUT ANY EVIDENCE ON RECORD TO SHOW THAT THE AGRICULTURAL INCOME SHOWN BY THE ASSE SSEE WAS IN THE NATURE AND CHARACTER OF NON-AGRICULTURAL INCOME EXIGIBLE TO TA X. IN THIS VIEW OF THE MATTER, THE ACTION OF THE AO IN TAXING THE AGRICULTURAL INCOME SHOWN BY THE ASSESSEE AS NON- AGRICULTURAL INCOME IS HELD TO BE UNTENABLE. APPEAL FILED BY THE DEPARTMENT IS DISMISSED. * , 31 -08-2012 * ORDER PRONOUNCED ON 31 -08-2012 SD SD ( .. / T. K. SHARMA) ( .. / D. K. SRIVASTAVA) /JUDICIAL MEMBER / ACCOUNTANT MEMBER /RAJKOT: 31-08-2012. SRL/- * ** * /0 /0 /0 /0 10 10 10 10 / COPY OF ORDER FORWARDED TO:- 1. 4 / APPELLANT-. 2. /64 / RESPONDENT-. 3. : / CONCERNED CIT 4. :- / CIT (A). 5. 0 /, , / DR, ITAT, RAJKOT 6. / GUARD FILE. / BY ORDER , TRUE COPY SENIOR PRIVATE SECRETARY, ITAT, RAJKOT BENCH :