Vinod Katuwa, JAIPUR V. DCIT, UDAIPUR

ITA 382/JODH/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 82984 (ITAT-JODHPUR)
• Duration Of Justice: 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 28-08-2014
• Assessment Year: 2002-2003
• Appeal Filed On: 18-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAI SINGH
• Assessee Lawyers: RAHUL LAKHWANI
• Keywords: Unexplained investment; Salary income; Reason to believe; Reassessment proceedings
• Section: 234B; 147; 69; 148

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENCH : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO. 382 /JODH/2014 (A.Y. 200 2 - 03 ) SHRI VINOD KATUWA, C/O M/S. CHETAK COMPLEX, NAI ABADI, BANSWARA. VS. DCIT, CENTRAL CIRCLE - 1, UDAIPUR . PAN NO. AENPK 0467 J (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RAHUL LAKHWANI . DEPARTMENT BY : SHRI JAI SINGH - D.R. DATE OF HEARING : 2 8 / 0 8 /201 4 . DATE OF PRONOUNCEMENT : 24/ 0 9 /201 4 . O R D E R PER N.K. SAINI, A.M TH IS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 29 /0 4 /201 4 OF L D . CIT(A), CENTRAL, JAIPUR . THE FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL: 1. UNDER THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A), CENTRAL, JAIPUR IS NOT JUSTIFIED IN A) UPHOLDING THE ISSUANCE OF NOTICE U/S. 148 OF THE I.T. ACT FOR REOPENING OF THE COMPLETED ASSESSMENT, AND 2 B) IN NOT DECLARING THE REASSESSMENT PROCEEDINGS U/S. 147 OF THE I.T. ACT, 1961 AS ILLEGAL AND WI THOUT AUTHORITY OF LAW. 2. UNDER THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A), CENTRAL, JAIPUR HAS ERRED IN DECLARING THE INVESTMENT AMOUNTING TO RS. 4,89,000/ - MADE BY M/S. CHETAK COMPLEX AS UNEXPLAINED INVESTMENTS OF PURCHASE OF LAND U/S. 69 OF THE I.T. ACT, IN THE HANDS OF APPELLANT. 3. UNDER THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A), CENTRAL, JAIPUR HAS ERRED IN CONFIRMING THE TREATMENT OF AGRICU LTURE INCOME AMOUNTING TO RS. 6 1,782/ - AS INCOME FROM OTHER SOURCES. 4. THAT THE ORDER OF LD. CIT(A) CENTRAL, JAIPUR DATED 29/04/2014 IS ARBITRARY, PERVERSE AND BAD IN LAW. 5. UNDER THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) , KOTA HAS ERRED IN UPHOLDING THE LEVY OF INVESTMENT U/S. 234A AND 234 B. 6. THE APPELLANT CRAVES TO ALTER, AMEND AND MODIFY ANY GROUND OF APPEAL ON OR BEFORE THE DATE OF HEARING. 2 GROUND NOS. 4 & 6 ARE GENERAL IN NATURE, SO DO NOT R EQUIRE ANY COMMENTS ON OUR PART. GROUND NO. 1 WAS NOT PRESSED , THEREFORE, IT IS DISMISSED AS NOT PRESSED. 3. VIDE GROUND NO. 2, THE GRIEVANCE OF THE ASSESSEE RELATES TO THE SUSTENANCE OF ADDITION OF RS. 4,89,000/ - U/S. 69 OF THE I.T. ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT IN SHORT) . 4. FACTS RELATING TO THIS ISSUE, IN BRIEF, ARE THAT THE ASSESSEE FILED THE RETURN OF INCOME DECLARING TOTAL INCOME OF RS. 1,42,005/ - AND AGRICULTURAL INCOME OF RS. 2,12,322/ - ON 31/03/2003 . LATER ON, THE CASE WAS REOPENED U/S. 148 OF THE ACT BY RECORDING THE FOLLOWING SATISFACTION: - 3 DURING THE COURSE OF ASSESSMENT PROCEEDINGS IN THE CASE OF SHRI RAVINDRANATH BHANDARI FORA.Y. 2002 - 03, IT HAS COME TO NOTICE THAT SHRI RAVINDRA NATH BHANDARI AND SHRI VINOD KATUWA JOINTLY PURCHASED LAND WORTH RS. 9.78 LACS AT DAHOD ROAD BY INVESTING RS. 4.89 LACS EACH. SHRI VINOD KATUWA, AN EMPLOYEE OF RAJASTHAN BANK HAS FILED HIS RETURN OF INCOME FROM SALARY AT RS. 142005/ - AND AGRICULTURE INCO ME AT RS. 212322/ - . THE ASSESSEE ALONGWITH THE RETURN OF INCOME HAS NOT ENCLOSED COPY OF CAPITAL ACCOUNT OR BALANCE SHEET. IN ABSENCE OF SUCH DOCUMENTS IN HIS RETURN OF INCOME, ACCUMULATION OF CAPITAL, SOURCES INVESTMENT ETC. IS NOT VERIFIABLE FROM RECORD. NO DETAILS REGARDING OWNERSHIP OF AGRICULTURE LAND, AGRICULTURE ACTIVITIES EARNED OUT, YIELD OBTAINED FROM THE FIELD, SALE OF YIELD IN MARKET AND EARNING INCOME THERE FROM ETC. HAS EVER BEEN FURNISHED BY THE ASSESSEE. U NDER THE CIRCUMSTANCE I HAVE REASON TO BELIEVE THAT THE INVESTMENT IN LAND AMOUNT OF RS. 4.89 LACS IS NOTHING BUT UNEXPLAINED MONEY OF THE ASSESSEE FROM UNDISCLOSED SOURCES. INCOME SHOWN FROM AGRICULTURAL ACTIVITIES IN ABSENCE OF CORROBORATIVE EVIDENCE BROUGHT ON RECORD IS NOTHING BUT INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES. THUS SUBSTANTIAL INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. 5. DURING THE COURSE OF ASSESSMENT PROCEEDINGS , THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE AND SHRI R.N. BHANDARI JOINT LY PURCHASED THE LAND WOR TH RS. 9 . 7 8 LAC INCLUDING REGISTRATION CHARGES AT DAHOD ROAD BY INVESTING RS. 4.89 LAC EACH . THE ASSESSING OFFICER ASKED THE ASSESSEE AB O UT THE SOURCE OF INVESTMENT ALONG WITH DOCUMENTARY EVIDENCES. IN RESPONSE, THE ASSESSEE SUBMITTED AS UNDER: - LAND LOCATED AT THE DAHOD ROAD, BANSWARA WAS JOINTLY PURCHASED ALONGWITH SHRI R.N. BHANDARI AT RS. 9.78 LACS FOR THE PURPOSE OF BUSINESS IN PARTNERSHIP IN THE NAME OF CHETAK COMPLEX AND THE SAID INVESTMENT HAS BEEN DISCLOSED AND CONSI DERED TO BE THE BUSINESS INVESTMENT IN THE BALANCE SHEET OF THE FIRM FOR A. Y. 2002 - 03. COPY OF BALANCE SHEET OF CHETAK COMPLEX, BANSWARA ENCLOSED FOR YOUR KIND PERUSAL, IT MAY KINDLY BE NOTICED THAT THE UNDERSIGNED VINOD KATUWA AND SHRI R.N. BHANDARI ARE EQUAL PARTNERS IN THE FIRM AND MU L TI STORY BUILDING HAS BEEN CONSTRUCTION AND SOLD IN THE SUBSEQUENT YEARS. 4 THE ASSESSING OFFICER AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE OBSERVED THAT IN THE SALE AGREEMENT ITSELF, THE DETAILS OF PA YMENTS MADE WERE ALSO MENTIONED WHICH CLEARLY INDI C ATED THAT RS. 5 LAC WERE PAID BY THE ASSESSEE THROUGH CHEQUE AGAINST THE PURCHASE AND THE ASSESSEE FAILED TO EXPLAIN THE SOURCE OF THE SAID AMOUNT . H E , THEREFORE, ADDED RS. 5 LAC U/S. 69 OF THE ACT CONSIDERING THE SAME AS UNEXPLAINED INVESTMENT. 6 . BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND SUBMITTED AS UNDER: - PROVISION OF SECTION 69 OF THE ACT NOT APPLICABLE 1. WITH THE PERUSAL OF THE PROVISION OF SECTION 69 OF THE ACT IT IS CLEAR THAT IT IS APPLICABLE IN CASES WHERE IN AN INVESTMENT HAS BEEN MADE BY THE ASSESSEE. AS PER THE FACTS OF THE CASE AS DISCUSSED HEREIN ABOVE IT IS CLEAR THAT NO INVESTMENT HAS BEEN MA DE BY THE ASSESSEE. THE AMOUNT OF RS 5 LACS WHICH THE ASSESSING OFFICER IS TREATING AS UNEXPLAINED INVESTMENT IS IN FACT NEVER BEEN INVESTED BY THE APPELLANT. IT WAS M/S CHETAK COMPLEX THE PARTNERSHIP BETWEEN THE APPELLANT AND MR R. N. BHANDARI WHO MADE TH E INVESTMENT FROM THE FUNDS RECEIVED ON ACCOUNT OF AIR BOOKING OF THE PROPOSED PROJECT. NOW, AS NO INVESTMENT HAS BEEN MADE BY THE APPELLANT SO A QUESTION OF MAKING ADDITION ON ACCOUNT OF UNEXPLAINED INVESTMENT IN THE HANDS OF THE APPELLANT CANNOT ARISE AT ALL. SOURCE OF MAKIN G INVESTMENT IS DULY EXPLAINED 2. ANY ADDITION U/S 69 CAN BE MADE ONLY IN CASES WHERE IN THE SOURCE OF MAKING INVESTMENT IS UNEXPLAINED. WITHOUT PREJUDICE TO ABOVE, FOR THE TIME BEING EVEN IF IT IS ACCEPTED THAT THERE WAS N O PARTNERSHIP EXISTING, (HOWEVER APPELLANT DOES NOT ACCEPT THIS ASSERTION OF THE LD AO AT ALL) THE SOURCE OF MAKING INVESTMENT FOR THE PURCHASE OF THE LAND IS DULY EXPLAINED. THE PAYMENT OF RS 5 LACS WAS MADE IN CASH FROM THE DULY ACCOUNTED FOR 5 ADVANCE BOO KING RECEIPTS OF FIRM M/S CHETAK COMPLEX. HENCE, THE APPELLANT HAS DULY DISCHARGED HIS ONUS OF PROVING THE SOURCES OF INVESTMENT; ON THIS ACCOUNT THE ADDITION MADE BY THE LD AO FOR A DULY EXPLAINED TRANSACTION IS GROSS INJUSTICE TO THE APPELLANT AND DESERV ES TO BE DELETED. ASSERTION OF THE LD AO THAT THERE WAS NO PARTNERSHIP AS ON THE DATE OF PURCHASE OF LAND IS INCORRECT . 3. IT IS AN ESTABLISHED LEGAL POSITION THAT PARTNERSHIP IS NOT NECESSARILY CREATED BY AN AGREEMENT IN WRITING. IT COULD BE BY ORAL AGREEMENT ALSO OR AN AGREEMENT CAN BE INFERRED BY THE CONDUCT OF THE PARTIES. ON PERUSAL OF THE RECITAL CLAUSE OF THE SALE DEED IT IS CLEAR THAT THE APPELLANT AND MR R. N BHANDARI PURCHASED THE LAND JOINTLY. THE RECITAL CLAUSE OF THE PARTNERSHIP DEED PROVIDES THAT THE LAND WAS PURCHASED JOINTLY AND NOW THEY ARE FORMALLY INCORPORATING THE SAME IN THE PARTNERSHIP BY DOCUMENTING THE SAME IN A PARTNERSHIP DEED. THE STATEMENT OF AFFAIRS OF FIRM FOR THE YEAR 2001 - 2002 SHOW RECORDING OF THE LAND IN THE PARTNERSHIP FIRM AND THE BALANCES OF THE FY 2001 - 2002 HAS BEEN CARRIED FORWARD AS OPENING BALANCE FOR THE YEAR 2002 - 03. 4. WITH ALL THE ABOVE EVIDENCES IT IS APPARENT THAT THE RELATION OF THE PARTNERSHIP DULY EXISTED AS ON THE DATE ON WHICH INVESTMENT IN QUESTION WAS MADE. HENCE, THE ASSERTION OF THE LD AO THAT THERE IS NO PARTNERSHIP EXISTING AS ON THE DATE OF ENTERING INTO SALE DEED IS INCORR ECT. REGISTRATION IS NOT A CRITERION FOR THE CREATION OF THE PARTNERSHIP FIRM 5. THE LD AO HAS MADE THE ASSERTION THAT AS THE PARTNERSHIP GOT REGISTERED WITH THE REGISTRAR OF FIRM AS LATE AS ON 13.08.2002, THEN HOW IT CAN HAPPEN THAT THE FIRM ENTERED INTO A C ONTRACT OF PURCHASE OF LAND ON 19.09.2001. 6. THE LD AO HAS GROSSLY ERRED IN NOT APPRECIATING THE LEGAL PROVISIONS OF THE INDIAN PARTNERSHIP ACT, 1932, WHICH IS THE PRINCIPAL LAW GOVERNING AND REGULATING THE PARTNERSHIP FORM OF BUSINESS. AS PER SECTION 58 OF THE PARTNERSHIP ACT, A FIRM MAY BE REGISTER ED AT ANY TIME; NOT MERELY AT THE TIME OF ITS FORMATION. THE REGISTRATION OF THE PARTNERSHIP FIRM IS NOT COMPULSORY UNDER PART VII OF THE INDIAN PARTNERSHIP ACT, HOWEVER REGISTRATION BRINGS ADVANTAGE TO A FIRM. NOW, THE FACT THAT THE APPELLANT MADE AN APPL ICATION FOR THE REGISTRATION OF THE FIRM WITH THE REGISTRAR AS ON 12.08.2002 DOES NOT INFER THAT THERE WAS NO RELATION OF THE PARTNERSHIP ON 6 19.09.2001. THEREFORE, THE VERY OWN BASIS OF TAKING THE STAND THAT THERE WAS NO PARTNERSHIP FIRM IS INCORRECT. 7. IN L IGHT OF THE ABOVE SUBMISSIONS APPELLANT HUMBLY PRAY BEFORE YOUR GOOD SELF TO DELETE THE IMPUGNED ADDITION MADE BY THE LD AO OF THE AMOUNT PAID ON PURCHASE OF LAND AS AN UNEXPLAINED INVESTMENT IN THE HANDS OF THE APPELLANT. 7 . THE LEARNED CIT(A), AFTER C ONSIDERING THE SUBMISSIONS OF THE ASSESSEE, OBSERVED THAT THE ASSESSEE AND SHRI R.N. BHANDARI PURCHASED THE LAND FOR RS. 8,55,000/ - ON 19/09/2001 AND THE SELLER RECEIVED RS. 3,55,000/ - IN CASH AND RS. 5,00,000/ - VIDE CHEQUE DATED 19/09/2001 FROM THE ASSESSEE. HE FURTHER OBSERVED THAT THE LAND WAS PURCHASED IN INDIVIDUAL CAPACITY AND SUBSEQUENT LY IT WAS TRANSFERRED TO THE FIRM M/S. CHETAK COMPLEX ON 12/08/2002 I.E. THE DATE ON WHICH THE FIRM CAME INTO EXISTENCE A ND COMMENCED ITS COMMERCIAL ACTIVITY. THE LD. CIT(A) POINTED OUT THAT THE ASSESSEE CLAIMED VIDE SUBMISSIONS DATED 28/04/2014 THAT THE SOURCE OF RS. 5,00,000/ - FOR PURCHASE OF LAND WAS THE AMOUNT RECEIVED BY M/S. CHETAK COMPLEX AS ADVANCE FROM P ROPOSED BUYERS FOR SALE IN THE PROPOSED COMPLEX BUT NO UNIT WAS ALLOTTED TO THE SAID PROPOSED BUYERS AS THEIR BOOKINGS WERE CANCELLED . THE LD. CIT(A) OBSERVED THAT NAMES OF THOSE PERSONS WERE NOT MENTIONED, THEREFORE, THE SAID CONTENTION WAS NOT ACCEPT ABLE . THE LD. CIT(A) POINTED OUT THAT THE ASSESSING OFFICER HIMSELF HAD OBSERVED THAT BOTH SHRI R.N. BHANDARI 7 AND THE ASSESSEE INVESTED RS. 4.89 LAC EACH ON PURCHASE OF THIS LAND, BUT THE ADDITION OF RS. 5 LAC WAS MADE ON THE BASIS OF THE NOTING IN THE SALE DEED WHEREIN IT HAD BEEN MENTIONED THAT THE SELLER RECEIVED RS. 5 LAC ON 19/09/2001 VIDE CHEQUE NO. 694348 OF BANK OF RAJASTHAN AND SUBSEQUENTLY THE SELLERS SUBMITTED A LETTER DATED 01/06/2001 THAT THE CHEQUE N. 694348 FOR RS. 5 LAC DATED 19/09/2001 WAS RETURNED ON RECEIVING CASH. THE LD. CIT(A) POINTED OUT THAT THE COPY OF BANK ACCOUNT OF THE ASSESSEE REVEALED THAT DURING THE RELEVANT PERIOD, NO CORRESPONDING WITHDRAWALS OF RS. 5 LAC WERE REFLECTED THEREIN. HE THEREFORE, RESTRICTED THE ADDITION T O RS. 4.89 LAC BEING HALF OF THE TOTAL INVESTMENT INSTEAD OF RS. 5 LAC . NOW THE ASSESSEE IS IN APPEAL. 8 . LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND FURTHER SUBMITTED THAT THE SIMILAR ADDITIONS MADE IN THE HANDS OF THE PARTNER SHRI R.N. BHANDARI WAS DELETED BY THE LD. CIT(A) VIDE ORDER DATED 28/12/2007 PASSED IN APPEAL NO. 358/IT/UDR/2007 - 08 , COPY OF WHICH IS PLACED AT PAGE NOS. 12 TO 19 OF THE ASSESSEES PAPER BOOK. IT WAS FURTHER STATED THAT AGAINST THE SAID ORDER OF THE LD. CIT(A), THE DEPARTMENT PREFERRED AN APPEAL BEFORE THE ITAT JODHPUR BENCH IN I.T.A.NO. 464/JU/2008 , BUT THE SAME WAS DISMISSED VIDE ORDER DATED 27/11/2008, COPY OF WHICH IS P L ACED AT PAGE 8 NOS. 1 TO 11 OF THE ASSESSEES PAPER BOOK . IT WAS FURTHER STATED THAT THE AMOUNT OF RS. 5 LAC ADDED BY THE ASSESS ING OFFICER ON THE BASIS OF NOT ING IN THE SALE DEED WAS NOT JUSTIFIED PARTICULARLY WHEN THE CHEQUE OF RS. 5 LAC WAS RETURNED BY THE SELLER AND IT WAS NEVER PRESENTED TO THE BANK. HE DREW OU R ATTENTION TOWARDS PAGE NO. 28 OF THE ASSESSEES PAPER BOOK WHICH IS A COPY OF CONFIRMATION BY THE ICICI BANK WHEREIN IT IS STATED THAT THE CHEQUE DATED 19/19/2001 FOR RS. 5 LAC WAS NOT PRESENTED IN THEIR BANK AND WAS NOT CLEAR ED . HE FURTHER SUBMITTED THAT THE FIRM M/S. CHETAK COMPLEX A PARTNERSHIP FIRM BETWEEN THE ASSESSEE AND SHRI R.N. BHANDARI MADE THE INVESTMENT FROM THE FUNDS RECEIVED ON ACCOUNT OF AIR BOOKING OF THE PROPOSED PROJECT AND THIS FACT HAD BEEN SUBSTANTIATED BY THE AFFIDAVIT OF THE SELLER. THEREFORE, NO INVESTMENT TOWARDS THE SAID AMOUNT WAS MADE BY THE ASSESSEE IN HIS INDIVIDUAL CAPACITY AS SUCH THE PROVISIONS OF SECTION 69 OF THE ACT WERE N O T APPLICABLE. IT WAS CONTENDED THAT THE INVESTMENT IN LAND WAS DULY EXPLAINED AND THE PAYMENT WAS MADE IN CASH FROM THE DULY ACCOUNTED FOR ADVANCE BOOKING RECEIPTS OF THE FIRM M/S. CHETAK COMPLEX, THEREFORE, THE ADDITION SU S TAINED BY THE LD. CIT(A) WAS NOT JUSTIFIED . 9 . IN HIS RIVAL SUBMISSIONS, LEARNED D.R. REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW . 9 10 . WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. IN THE PRESENT CASE, IT IS NOTICED THAT THE ASSESSEE ENTERED INTO A PARTNERSHIP FIRM WITH SHRI R.N. BHANDARI AND PURCHASED THE LAND FOR THE FIRM M/S. CHETAK COMP LEX FOR A SUM OF RS. 9.78 LAC . HOWEVER, T HE ASSESSING OFFICER MADE THE ADDITION OF RS. 5 LAC ON THIS BASIS THAT THE SAID AMOUNT WAS PAID BY THE ASSESSEE THROUGH CHEQUE, BUT HE IGNORED TH IS FACT THAT THE SELLER OF THE LAND FILED A LETTER STATING THEREIN THAT THE CHEQUE WAS RETURNED AND THE ICICI BANK ALSO ISSUED A CONFIRMATION STATING THEREIN THAT CHEQUE OF RS. 5 LAC WAS NOT PRESENTED AND CLEARED BY THEIR BANK. THEREFORE, THE ADDITION OF RS. 5 LAC MADE BY THE ASSESSING OFFICER WAS NOT JU STIFIED. IN THE PRESENT CASE, THE LD. CIT(A) SUSTAINED THE ADDITION OF RS. 4.89 LAC ONLY ON THIS BASIS TH A T THE ASSESSEE WAS HAVING 50% SHARE IN THE LAND COSTING RS. 9.78 LAC AND FAILED TO EXPLAIN THE SOURCE OF INVESTMENT. HOWEVER, THE ASSESSEE EXPLAINED THAT THE LAND WAS PURCHASED FOR THE FIRM M/S. CHETAK COMPLEX AND THE AMOUNT WAS RECEIVED FROM THE FIRM, WHO IN TURN REC E IV ED THE ADVANCES FROM THE CUSTOMER. THE SIMILAR ADDITION WAS ALSO MADE IN THE HANDS OF ANOTHER PARTNER SHRI R.N. BHANDAR I , B UT THE SAID ADDITION HAS BEEN DELETED BY THE LD. CIT(A) VIDE ORDER DATED 28/12/2007 AND THE APPEAL AGAINST THE SAID ORDER WAS DISMISSED BY THE 10 ITAT VIDE ORDER DATED 27/11/2008 . THEREFORE, THE ADDITION IN THE HANDS OF THE ASSESSEE WAS NOT JUSTIFIED AS THE SIMILAR ADDITION IN THE HANDS OF THE CO - OWNER OF THE ASSESSEE IN THE SAME LAND HAS ALREADY BEEN DELETED. IN THAT VIEW OF THE MATTER, THE ADDITION SUSTAINED BY THE LD. CIT(A) IN THE HANDS OF THE ASSESSEE IS DELETED. 11 . NEXT ISSUE VIDE GROUND NO. 3 REL ATES TO THE SUSTENANCE OF ADDITION OF RS. 61,782/ - MADE BY THE ASSESSING OFFICER BY CONSIDERING THE SAME AS INCOME FROM OTHER SOURCES . 12. FACTS RELATING TO THIS ISSUE, IN BRIEF, ARE THAT THE ASSESSEE DECLARED AGRICULTURAL INCOME OF RS. 2,12,322/ - FROM AGRICULTURAL OPERATION CARRIED OUT ON THE AGRICULTURAL LAND. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE AGRICULTURAL INCOME DECLARED BY THE ASSESSEE WAS NOT SUPPORTED WITH ANY CORROBORATIVE EVIDENCE AND THE SAME REMAINED UNVERIFIABLE. HE ALSO OBSERVED THAT THE ASSESSEE HAD DECLARED AGRICULTURAL INCOME OF RS. 1,50,550/ - IN THE EARLIER YEAR. THEREFORE, THE AGRICULTURAL INCOME FOR THIS YEAR WAS RESTRICTED TO RS. 1,50,550/ - AND THE BALANCE AMOUNT OF RS. 6 1,782/ - ( RS. 2,12,322/ - ( - ) RS. 1,50,550/ - ) WAS TREATED AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES. 11 13 BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND SUBMITTED AS UNDER: - 6.2 THE AR OF THE APPELLANT ATTENDED THE APPELLATE PROCEEDINGS AND FILED THE FOLLOWING SUBMISSIONS: NO OBJECTION RAISED AGAINST THE DOCUMENTS PLACED ON RECORDS BY THE APPELLANT 1. IN ORDER TO DISCHARGE HIS ONUS REGARDING CARRYING OUT THE AGRICULTURE ACTIVITY THE APPELLANT SUBMITTED BEFORE THE LD A O FOLLOWING DOCUMENTS: A. POA DATED 23.02.1985 ISSUED IN THE FAVOUR OF THE APPELLANT EVIDENCING OWNERSHIP OF THE LAND. B. GIRDHAVARI REPORT ISSUED FROM THE OFFICE OF THE TEHSILDAR AS EVIDENCE OF THE AGRICULTURE ACTIVITIES AND YIELD OBTAINED FROM THE FIELDS. C. INCO ME TAX RETURNS OF THE EARLIER YEARS EVIDENCING THE CARRYING OUT OF OPERATIONS BY THE APPELLANT. THE LD AO NEVER QUESTIONED THE GENUINENESS OF THESE DOCUMENT OR OBJECTED THE ENTRIES RECODED IN THESE DOCUMENTS. WITH THE PERUSAL OF THESE DOCUMENTS IT IS LOUD AND CLEAR TH A T THE ASSESSEE WAS ENGAGED IN CARRYING OUT THE AGRICULTURAL ACTIVITIES AND EARNING INCOME THEREOF. HENCE , THE ACTION OF THE LD. AO OF MAKING ANY ADDITIONS BY REJECTING THE, CLAIM OF THE APPELLANT OF THE QUANTUM OF INCOME EARNED ON CARRYING OUT AGRICULTURE ACTIVITY IS UNSUSTAINABLE AND ILLEGAL. ALLE G ATION OF THE AO THAT DETAILS REGARDING THE YIELD OBTAINED HAS NOT BEEN FURNISHED IS INCORRECT 2. THE LD AO HAS ALLEGED THAT THE APPELLANT HAS NOT MENTIONED ANY DETAILS REGARDING THE YIELD OBTAINED FROM THE FIELDS. THE APPELLANT IN THIS REGARD HUMBLY SUBMITS THAT THE LD AO HAS GROSSLY ERRED IN OVERLOOKING THE ENTRIES MADE IN THE GIRDHAVARI REPORT MADE AVAILABLE TO THE LD AO. GIRDHAVARI REPORT IS A RECORD MAINTAINED AT THE OFFICE OF TEHSILDAR WHERE IN DET AILS REGARDING THE YIELD OBTAINED FROM THE LANDS SITUATED IN THE AREA OF THE JURISDICTION OF THE TEHSILDAR ARE MAINTAINED. WITH THE PERUSAL OF THE ENTRIES MADE IN THE GIRDHAVARI RECORDS IT IS CLEAR THAT WHICH TYPE OF YIELDS WERE OBTAINED BY THE APPELLANT F ROM THE LAND. HENCE, THE VERY OWN BASIS OF MAKING THE IMPUGNED ADDITION IS NOT EXISTING IN THE PRESENT CASE HENCE THE ACTION OF THE LD AO OF TREATING THE DISCLOSED AGRICULTURE INCOME AS 12 UNDISCLOSED INCOME IS PERVERSE. APPELLANT HAS DISCHARGED HIS ONUS 3. WITH THE DISCUSSION IN ABOVE PARA IT IS CLEAR BY MEANS OF DIFFERENT DOCUMENTS SUCH AS POA, GRIDHAVARI REPORT AND PREVIOUS YEAR ROI THE APPELLANT HAS DISCHARGED HIS O NUS SO AS TO PROVE THE SOURCE OF EARNING AGRICULTURE INCOME. YOUR GOOD SELF WILL APPRECIATE THA T EARNING A MEAGRE INCOME FROM SUCH A HUGE SIZE OF FERTILE LAND CAN NOT BE QUESTIONED. HENCE, THE ACTION OF THE LD AO OF MAKING ARBITRARY ADDITION BY DISALLOWING THE CLAIM OF AGRICULTURE INCOME NEEDS TO BE DELETED. 14 THE LEARNED CIT(A), AFTER CONSIDERIN G THE SUBMISSIONS OF THE ASSESSEE, OBSERVED THAT THE ASSESSEE WAS REQUIRED TO MAINTAIN RECORDS FOR AGRICULTURAL INCOME AND IN ABSENCE OF ANY EVIDENCE OR RECORD REGARDING THE EXPENDITURE INCURRED OR SALE OF CROPS THE MERE FACT THAT CERTAIN CROPS WERE GROWN AS PER THE GIRDAWARI WAS NOT SUFFICIENT INFORMATION FOR ARRIVING AT THE NET AGRICULTURAL INCOME. ACCORDINGLY, THE ADDITION MADE BY THE ASSESSING OFFICER OF RS. 61,782/ - AS INCOME FROM OTHER SOURCES WAS CONFIRMED. NOW THE ASSESSEE IS IN APPEAL. 15 LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND FURTHER SUBMITTED THAT THE AGRICULTURAL INCOME IN THE EARLIER YEAR WAS ACCEPTED, SO THERE WAS NO OCCA S ION TO DOUBT THE AGRICULTURAL INCOME FOR THE YEAR UNDER CONSIDERATION . IT WAS FURTHER STATED THAT THE GIRDAWARI REPORT ISSUED BY THE OFFICE OF THE 13 TEHSILDAR AS AN EVIDENCE OF THE AGRICULTURAL ACTIVITIES AND YIELD OBTAINED FROM FILED , WAS FURNISHED BEFORE THE AUTHORITIES BELOW AND THIS FACT WAS ACCEPTED THAT THE ASSESSEE WAS INVOLVED IN AGRICULTURAL ACTIVITIES. THEREFORE, THE ADDITION SUSTAINED BY THE LD. CIT(A) WAS NOT JUSTIFIED PARTICULARLY WHEN THE BASIS OF CALCULATION OF AGRICULTURAL INCOME DISALLOWED WAS NOT BROUGHT ON RECORD. 16 IN HIS RIVAL SUBMISSIONS, LEARNED D.R. SUPPORTED THE ORDER OF THE AUTHORITIES BELOW. 17 WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. IN THE PRESENT CASE, IT IS NOTICED THAT THE ASSESSING OFFICER AS WELL AS LD. CIT(A) ACCEPTED THIS FACT THAT THE ASSESSEE WAS ENGAGED IN AGRICULTURAL ACTIVITIES AND WAS EARNING AGRICULTURAL INCOME . THE ASSESSEE DECLARED AGRICULTURAL INCOME AT RS. 2,12,322/ - BUT THE ASSESSING OFFICER ACCEPTED THE SAME AT RS. 1,50,550/ - ONLY ON THIS BASIS THAT A SIMILAR INCOME WAS ACCEPTED IN THE EARLIER YEAR, HOWEVER, HE HAS NOT BROUGHT ANY MATERIAL ON RECORD TO SUBSTANTIATE THAT REMAINING INCOME OF RS. 6 1,782/ - WAS THE INCOME FROM OTHER SOURCES AND NOT AGRICULTURAL INCOME . SIMILARLY, THE LD. CIT(A) WHILE CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER HAS NOT 14 BROUGHT ON RECORD ANY MATERIAL TO SUBSTANTIATE TH A T THE SAID INCOME WAS IN FACT AN INCOME FROM OTHER SOURCES AND NOT AGRICULTURAL INCOME . IN OUR OPINION, THE ADDITION MADE BY THE ASSESSING OFFICER AND SUSTAINED BY THE LD. CIT(A) IS ONLY A PRESUMPTION BASIS WHICH IS NOT TENABLE IN THE EYES OF LAW. ACCORDINGLY, THE SAME IS DELETED . 18 THE LAST GRIEVANCE OF THE ASSESSEE VIDE GROUND NO. 5 RELATES TO THE LEVY OF INTEREST U/S. 234A & 234B OF THE ACT. AS REGARDS TO THIS GROUND, IT WAS COMMON CONTENTION OF BOTH THE PARTIES THAT IT IS CONSEQUENTIAL IN N A TURE. WE ORDER ACCORDINGLY. 19 IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ( ORDER PRONOUNCED IN THE COURT ON 24 TH SEPTEMBER , 201 4) . S D/ - SD/ - ( HARI OM MARATHA ) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 24 TH SEPTEMBER , 201 4 . VR/ - COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE LD. CIT 4. THE CIT(A) 5. THE D.R SR. PRIVATE SECRETARY , ITAT, JODHPUR .