Shri Babulal Rughnathdas Patel, Unjha V. The Income tax Officer, Patan Ward - 4, Unjha

ITA 429/AHD/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5113 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 20-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R P MAURYA
• Keywords: Presumptive income; Peak credit
• Section: 68; 144

Judgement Text

, SMC IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ./ I.T.A. NO. 429/AHD/2017 ( ASSESSMENT YEAR : 2008-09) SHRI BABULAL RUGHNATHDAS PATEL, C-41, SARDARNAGAR SOCIETY, MAKTUPUR, UNJHA -384170 / VS. THE INCOME TAX OFFICER, PATAN, WARD-4, UNJHA ./ ./ PAN/GIR NO. : AOYPP4840F ( APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI NEELKANTH KHANDELWAL, A.R. / RESPONDENT BY : SHRI R. P. MAURYA, SR.D.R. DATE OF HEARING 18/07/2018 !'# / DATE OF PRONOUNCEMENT 02/08/2018 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE CIT(A), GANDHINAG AR (CIT(A) IN SHORT), DATED 19.12.2016 ARISING IN THE ASSESSMENT ORDER DATED 29.01.2016 PASSED BY THE ASSESSING OFFICER (AO) UND ER S. 144 R.W.S. ITA NO. 429/AHD/17 [SHRI BABULAL R. PATEL VS. ITO] A.Y. 2008-09 - 2 - 147 OF THE INCOME TAX ACT, 1961 (THE ACT) CONCERNIN G ASSESSMENT YEAR 2008-09. 2. BY WAY OF ITS GROUNDS OF APPEAL, THE ASSESSEE H AS CHALLENGED THE ADDITIONS OF RS.11,91,000/- MADE BY THE AO BY W ORKING OUT PEAK OF THE CASH DEPOSITS IN THE BANK. 3. WHEN THE MATTER WAS CALLED FOR HEARING, THE LEAR NED AR FOR THE ASSESSEE MR. NEELKANTH KHANDELWAL SUBMITTED AT THE OUTSET THAT BOTH THE AO & CIT(A) HAVE MISDIRECTED THEMSELVES ON FACT S AND LAW IN MAKING SUCH ADDITIONS WHICH WERE NOT WARRANTED AT A LL IN THE GIVEN SET OF FACTS. ADVERTING FURTHER, THE LEARNED AR RE FERRED TO THE SUBMISSIONS MADE BEFORE THE LOWER AUTHORITIES AND S UBMITTED THAT THE ASSESSEE IS A FARMER HAVING AGRICULTURAL LAND A T VILLAGE SANKHARI, DISTRICT PATAN, GUJARAT AND THE MAIN SOURCE OF INCO ME IS FROM AGRICULTURAL PRODUCE. THE MAIN PRODUCES ARE BAJARI , TOBACCO, ARENDA ETC. THE LEARNED AR SUBMITTED THAT COPY OF 7/12 AND FORM 8-A EVIDENCING PRODUCE FROM THE AGRICULTURAL TOGETH ER WITH STATE BANK AGRICULTURAL LOAN ACCOUNT STATEMENT WAS FURNIS HED BEFORE THE LOWER AUTHORITIES. THE LEARNED AR SUBMITTED THAT T HE CASH DEPOSITS MADE ARE VERY SMALL AND REPRESENTS PROCEEDS FROM SA LE OF AGRICULTURAL PRODUCE AND SOME AMOUNT OF RECEIPT IS ATTRIBUTABLE TO TRACTOR. THE LEARNED AR THUS SUBMITTED THAT FOR SU CH SMALL ACTIVITY ITA NO. 429/AHD/17 [SHRI BABULAL R. PATEL VS. ITO] A.Y. 2008-09 - 3 - OF AGRICULTURE, THE ASSESSEE IS COVERED BY THE PROV ISIONS OF SECTION 44AF OF THE ACT. THE ASSESSEE HAS SHOWN A NET PROF IT OF RS.74,000/- ON THE SALE OF AGRICULTURAL PRODUCES AND TRACTOR IN COME WHICH IS MORE THAN 5%. THE CASH DEPOSITS IN THE BANK ARE RE LATABLE TO THE AGRICULTURAL PRODUCE SALE AND RE-DEPOSITS OF THE WI THDRAWALS. IN THESE CIRCUMSTANCES, THE LEARNED AR SUBMITTED THAT THE INVOCATION OF SECTION 68 OF THE ACT AND MAKING ADDITIONS TOWARDS PEAK CREDIT WOULD NEGATE THE PROVISIONS OF SECTION 44AF OF THE ACT AND THUS NOT CALLED FOR. 4. THE LEARNED RELIED UPON THE ORDER OF THE AUTHORI TIES BELOW. 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. A PERUSAL OF THE RECORDS SHOW THAT IT IS THE CONSISTENT STAND OF THE ASSESSEE THAT THE CASH DEPOSITS ARE INTEGRALLY CONNECTED TO THE SALE PROCEEDS FROM AGRICULTURAL PRODUCE AND A TRACTOR INCOME. IT IS ALSO THE MATTER OF RECORD THAT THE ASSESSEE HAS DECLARED INCOME WHI CH IS COMPATIBLE WITH THE PROVISIONS OF PRESUMPTIVE TAXATION. THERE FORE, NO FURTHER OBLIGATION CAN BE FASTENED UPON THE ASSESSEE IN THE GIVEN SET OF FACTS. THE CASH DEPOSITS ARE THUS REQUIRED TO BE T REATED AS EXPLAINED IN THE LIGHT OF AGRICULTURAL PRODUCE INCOME. IN TH ESE FACTS, THE BENEFIT OF DOUBT, IF ANY, REQUIRES TO GO IN FAVOUR OF THE ASSESSEE. ITA NO. 429/AHD/17 [SHRI BABULAL R. PATEL VS. ITO] A.Y. 2008-09 - 4 - THEREFORE, THE ADDITION MADE UNDER S.68 OF THE ACT BY THE REVENUE AUTHORITIES REQUIRES TO BE SET ASIDE AND CANCELLED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. SD/- SD/- (RAJPAL YADAV) (PRADI P KUMAR KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 02/08/2018 TRUE COPY S. K. SINHA !'#' / COPY OF ORDER FORWARDED TO:- &. / REVENUE 2. / ASSESSEE (. )*+ , / CONCERNED CIT 4. ,- / CIT (A) /. 012 33*+4 *+#4 56) / DR, ITAT, AHMEDABAD 7. 289 : / GUARD FILE. BY ORDER / 4 /5 *+#4 56) THIS ORDER PRONOUNCED IN OPEN COURT ON 02/08/2018