Satinder Singh Khandpure P/o M/s Central Motors, Khandwa V. Assistant Commissioner of Income Tax Circle Khandwa, Khandwa

ITA 463/Ind/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 7047 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 10 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 15-04-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 21-06-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: K G GOYAL
• Section: 143(3)

Judgement Text

SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE HONBLE KUL BHARAT, JUDICIAL MEMBER AND HONBLE MANISH BORAD, ACCOUNTANT MEMBER ITA NO.463/IND/2017 ASSESSMENT YEAR 2013-14 ITA NO.464/IND/2017 ASSESSMENT YEAR 2013-14 REVENUE BY SHRI K.G. GOYAL ASSESSEE BY SMT. SHREYA JAIN, CA DATE OF HEARING 1 5 .0 4 .2019 DATE OF PRONOUNCEMENT 29 .0 4 .2019 SHRI SATINDER SINGH KHANDPURE P/O M/S. CENTRAL MOTORS, PANDHANA ROAD, KHANDWA VS. ACIT, CIRCLE, KHANDWA (APPELLANT) (RESPONDENT ) PAN NO.A TQPS2322E SHRI BHUPENDRA SINGH KHANDPURE, P/O M/S. CENTRAL MOTORS, PANDHANA ROAD, KHANDWA VS. ACIT, CIRCLE, KHANDWA (APPELLANT) (RESPONDENT ) PAN NO.A TQPS232 4C SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 2 O R D E R PER MANISH BORAD, AM. THE ABOVE CAPTIONED TWO APPEALS FILED AT THE INSTAN CES OF THE ASSESSEES PERTAINING TO ASSESSMENT YEAR 201 3-14ARE DIRECTED AGAINST THE ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-II (IN SHORT LD.CIT(A)], INDORE WHI CH IS ARISING OUT OF THE ORDER U/S 143(3) OF THE INCOME TAX ACT 1961(IN SHORT THE ACT) DATED 26.02.2016 FRAMED BY ACIT, K HANDWA. 2. AS THE ISSUES RAISED IN THIS TWO APPEALS ARE COMMO N, THEREFORE THESE WERE HEARD TOGETHER AND ARE BEING D ISPOSED OFF BY THIS COMMON ORDER FOR SAKE OF CONVENIENCE AN D BREVITY. 3. ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEALS; (I) SHRI SATINDER SINGH KHANDPURE ITA NO.463/IND/2017 ASSESSMENT YEAR 2013-14 1- THE LEARNED CIT (APPEALS) HAS ERRED IN CONFIRMIN G THE ADDITIONS MADE BY THE LEARNED ASSESSING OFFICER WHO HAS ASSES SED TOTAL INCOME OF RS. 63,86,894/ - AND AGRICULTURE INCOME O F RS. 8,29,346/- AGAINST RETURNED INCOME OF RS. 49,37,640 / - AND AGRICULTURE INCOME RS. 22,78,600/ -, WHICH IS WRONG ILLEGAL AND SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 3 UNWARRANTED. 2- THE LEARNED CIT(APPEALS) HAS ERRED IN CONFIRMIN G THE REDUCTION IN AGRICULTURE INCOME FROM 22,78,600/- TO 8,29,346/ - AND AGRICULTURE INCOME TREATED AS INCOME FROM OTHER SOU RCES RS. 14,49,254/-, WHICH IS WRONG ILLEGAL AND UNWARRANTED . 3- THE APPELLANT RESERVES TO ADD, ALTER OR DELETE ANY GROUND OF APPEAL AT THE TIME OF HEARING. (II) SHRI BHUPENDRA SINGH KHANDPURE ITA NO.464/IND/2017 ASSESSMENT YEAR 2013-14 1- THE LEARNED CIT (APPEALS) HAS ERRED IN CONFIRMIN G THE ADDITIONS MADE BY THE LEARNED ASSESSING OFFICER WHO HAS ASSES SED TOTAL INCOME OF RS. 63,71,510/- AND AGRICULTURE INCOME OF RS. 8,29,346/- AGAINST RETURNED INCOME OF RS. 49,22,257/- AND AGRI CULTURE INCOME RS. 22,78,600/-, WHICH IS WRONG ILLEGAL AND UNWARRA NTED. 2- THE LEARNED CIT(APPEALS) HAS ERRED IN CONFIRMIN G THE REDUCTION IN AGRICULTURE INCOME FROM 22,78,600/- TO 8,29,346/ - AND AGRICULTURE INCOME TREATED AS INCOME FROM OTHER SOU RCES RS. 14,49,254/-, WHICH IS WRONG ILLEGAL AND UNWARRANTED . 3- THE APPELLANT RESERVES TO ADD, ALTER OR DELETE ANY GROUND OF APPEAL AT THE TIME OF HEARING. 4. BRIEF FACTS OF THE CASE AS CULLED OUT FROM THE RECO RDS ARE THAT 133 ACRE OF AGRICULTURE LAND SITUATED AT G RAM SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 4 PIPLOD, TEHSIL KHANDWA IS JOINTLY CULTIVATED BY THR EE PERSONS NAMELY SHRI SATINDER SINGH, SHRI BHUPENDRA SINGH AND SMT. AMRIT KAUR. PRESENT APPEAL RELATES T O TWO ASSESSEES NAMELY SHRI SATINDER SINGH AND SHRI BHUPENDER SINGH. APART FROM NON AGRICULTURE INCOME EARNED BY BOTH THE ASSEESSEES WHICH IS NOT IN DIS PUTE, EXEMPTION HAS BEEN CLAIMED FOR AGRICULTURE INCOME O F RS.22,78,600/- BY EACH OF THE TWO ASSESSEES BEING 1/3 RD SHARE. DISALLOWANCE HAS BEEN MADE OUT OF THE AGRICULTURE INCOME BY TREATING SOME PORTION AS INCO ME FROM OTHER SOURCES. 5. FOR THE PURPOSE OF ADJUDICATION WE WILL T TAKE UP THE FACTS OF SHRI SATINDER SINGH KHANDPURE ITA NO.463/IND/2017. E-RETURN WAS FILED ON 30.09.2013 DECLARING INCOME OF RS.49,37,640/- AND AGRICULTURE INCOME OF RS.22,78,600/-. CASE SELECTED FOR SCRUTIN Y UNDER CASS FOLLOWED BY SERVING OF NOTICES U/S 143(2 ) AND 142(1). LD. A.O WHILE EXAMINING THE GENUINENESS OF THE AGRICULTURE INCOME OF RS.22,78,600/- CALLED FOR THE SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 5 DETAILS OF VOUCHERS AND AGRICULTURE PRODUCE. ASSESS EE IS THE OWNER OF 42 ACRES OF LAND. BILLS AND THE VOUCH ERS FOR AGRICULTURE PRODUCE OF RS.37,17,383/- FROM 133 ACRE OF LAND WERE PLACED BEFORE LD. A.O. ASSESSEE CLAIMED THAT IT HAS ALSO EARNED AGRICULTURE INCOME FROM SALE OF SOYABEAN, FRUITS AND VEGETABLES FOR WHICH NO MANDI RECEIPTS IS AVAILABLE. LD. A.O HOWEVER WAS NOT CONVINCED WITH THE SUBMISSIONS MADE BY THE ASSESSEE AND HE FOLLOWING THE JUDGMENT OF HONBLE PUNJAB AND HARYANA HIGH COURT IN THE CASE OF CIT V/S JARNAIL S INGH KARTA 316 ITR 160 (2009) COMPUTED THE AGRICULTURE INCOME AT RS.27,88,037/- AFTER DEDUCTING 25% OF THE GROSS RECEIPT AS AGRICULTURE EXPENSES. ONE THIRD O F RS.27,38,037/- I.E. RS.9,29,346/- WAS ACCEPTED AS AGRICULTURE INCOME IN THE HANDS OF THE ASSESSEE. T HE REMAINING AMOUNT I.E. THE AGRICULTURE INCOME SHOWN IN THE INCOME TAX RETURN AT RS.22,78,600/- MINUS AGRICULTURE INCOME OF RS.9,29,346/- COMPUTED BY LD. A.O THAT IS RS. 14,49,254/- WAS ADDED TO THE INCOME AS INCOME FROM OTHER SOURCES AND ASSESSED ACCORDINGLY. SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 6 6. AGGRIEVED ASSESSEE PREFERRED APPEAL BEFORE LD. CIT (A). HOWEVER LD. CIT(A) AFTER CONSIDERING THE SUBMISSION S OF THE ASSESSEE DISMISSED THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE AND CONFIRMED THE ADDITION OF RS.14,49,254/-. 7. NOW THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL . 8. LD. COUNSEL FOR THE ASSESSEE AT THE OUTSET SUBMITT ED THAT THE ISSUE IS COVERED BY THE DECISION OF CO-ORD INATE BENCH, INDORE IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010-11 VIDE ITA NO.360/IND/2015 DATED 19.10.2016 WHEREIN THE HONBLE TRIBUNAL HAS ACCEPTE D THE ASSESSEES CONTENTION OF HAVING SOME AGRICULTUR E INCOME NOT SUPPORTED BY ANY BILLS AND VOUCHERS LOOK ING TO THE LAND HOLDING OF THE ASSESSEE SUBJECT TO DISALLOWANCE OF 30% OF SUCH AGRICULTURE SALE NOT SUPPORTED BY BILLS. WORKING NOTE OF COMPUTATION OF AGRICULTURE INCOME HAS BEEN PLACED ON RECORD AFTER APPLYING THE DIRECTION OF THE HONBLE TRIBUNAL GIVE N FOR PRECEDING ASSESSMENT YEAR I.E. 2010-11. SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 7 9. ON THE OTHER HAND LD. DEPARTMENTAL REPRESENTATIVE VEHEMENTLY ARGUED SUPPORTING THE ORDERS OF LOWER AUTHORITIES. 10. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS PLACED BEFORE US. 11. THE ASSESSEES SOLE GRIEVANCE IS AGAINST THE FINDI NG OF BOTH THE LOWER AUTHORITIES TREATING THE AGRICULT URE INCOME OF RS.14,49,254/- AS INCOME FROM OTHER SOURC ES. THERE IS NO DISPUTE TO THE FACT THAT THE ASSESSEE A LONG WITH SHRI BHUPENDRA SINGH AND SMT. AMRIT KAUR OWNS 133 ACRES OF AGRICULTURE LAND AT TEHSIL KHANDWA USE D FOR AGRICULTURE OPERATIONS. ASSESSEE DISCLOSED THE NET AGRICULTURE INCOME OF RS.22,78,600/-. DURING THE CO URSE OF ASSESSMENT PROCEEDINGS ASSESSEE WAS ABLE TO PROD UCE THE PROOF OF SALE OF AGRICULTURE PRODUCE FOR RS.37,17,383/- (FOR TOTAL 133 ACRE OF LAND). AFTER DEDUCTION OF 25% OF INCIDENTAL EXPENSES THE NET INC OME SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 8 FOR 133 ACRE LAND WAS CALCULATED BY THE LD. A.O AT RS. 27,88,037/- AND 1/3 RD OF THIS AMOUNT COMES TO RS.9,29,346/- WHICH WAS ACCEPTED BY THE REVENUE AUTHORITIES AS THE SHARE OF THE AGRICULTURE INCOME BY THE ASSESSEE. HOWEVER THE ASSESSE CLAIMED EXEMPTION FO R AGRICULTURE INCOME OF RS.22,78,600/- THE DIFFERENC E (RS.22,78,600/- LESS SHARE OF INCOME OF AGRICULTURE INCOME COMPUTED BY THE LD. A.O AT RS. 9,29,346/-) WHICH COMES TO RS.14,49,254/- HAS BEEN TREATED AS INCOME FROM OTHER SOURCES BY BOTH THE LOWER AUTHORI TIES. LD. COUNSEL FOR THE ASSESSEE REFERRED TO THE DECISI ON OF CO-ORDINATE BENCH IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010-11 WHEREIN THE ISSUE WITH REGA RD TO SALE OF AGRICULTURE PRODUCTS WITHOUT BILLS AND VOUCHERS WAS CONSIDERED AND 30% OF SUCH SALES WAS TREATED AS INCOME FROM OTHER SOURCES BY THE TRIBUNA L OBSERVING AS FOLLOWS; 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE GO NE THROUGH THE ORDERS OF THE LOWER AUTHORITIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSEE HAS SHOWN AGRICULTURAL INCOME SALES AT RS. 15,60,000/- WHICH INCLUDES SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 9 RS.6,00,000/- INCLUDING RS.2,55,750/- BEING SALES O F WHEAT AND SOYABEAN SHOWN AT HIGHER PRICE AS COMPARED TO MANDI SALES. THESE SALES ARE IN THE NATURE OF ON SPOT SAL ES MADE EFFECTED OUTSIDE MANDI TO PRIVATE PARTIES. WE FIND THAT THE ASSESSEE HAS AGRICULTURAL LAND HOLDING AT 40 ACRES OF IRRIGATED AGRICULTURAL LAND. THE ASSESSEE HAS ALSO FILED CONFIRMATION OF PARTIES I.E. AGRICULTURIST, TO WHOM S ALES WAS MADE. THEREFORE, CONSIDERING THE CIRCUMSTANCES AND IN ABSENCE OF BOOKS OF ACCOUNTS IN RESPECT OF AGRICULT URAL PRODUCE BEING NOT MAINTAINED AND CASE LAWS AS RELIED ON BY THE ASSESSEE, IT WOULD BE REASONABLE TO ESTIMATE 30 OF THE SALES AMOUNTING TO RS.6,00,000/- TO PRIVATE PARTIES AS NO N- EXPLAINED AGRICULTURAL INCOME WHICH WOULD BE WORKED OUT TO RS.1,80,000/-. ACCORDINGLY, THE ADDITION OF RS. 1,8 0,000/- IS CONFIRMED AND THE BALANCE ADDITION OF RS.3,11,590/- I.E. [RS.4,91,590 RS. 1,80,000] IS DELETED. THIS GROU ND OF APPEAL IS THEREFORE, PARTLY ALLOWED. 12. IN THE LIGHT OF ABOVE DECISION OF THE CO-ORDINATE BENCH IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEA R 2010-11 AS WELL AS THE FACT THAT ASSESSEE HAS NOT DISPUTED THE INCURRING OF 25% OF GROSS AGRICULTURE INCOME AS INCIDENTAL EXPENSES FOR CARRYING OUT AGRICULTURAL OPERATIONS, AGRICULTURE INCOME OF THE ASSESSEE IS COMPUTED IN THE FOLLOWING MANNER; SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 10 S.NO. PARTICULARS AMOUNT 1 1/3 SHARE OF INCOME FROM THE SALE OF AGRICULTURE PRODUCE DULY SUPPORTED BY BILLS/ VOUCHERS RS.37,17,383/- LESS 25% OF EXPENSES = RS.27,88,037/-.1/3 SHARE OF ASSESSEE RS.9,29,346/ - 2 NET AGRICULTURE INCOME FROM SALE OF AGRICULTURE PRODUCE NOT SUPPORTED BY BILLS/VOUCHERS; AGRICULTURE INCOME DECLARED BY THE ASSESSEE RS.27,78,600/- LESS NET AGRICULTURE INCOME FROM SALE OF AGRICULTURE PRODUCE SUPPORTED BY BILLS/ VOUCHERS RS. 9,29,346/- GROSS SALES FIGURE FOR GOODS SOLD WITHOUT BILLS & VOUCHERS RS.18,49,254/- LESS:25% FOR INCIDENTAL SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 11 EXPENSES RS. 4,62,314/- RS.13,86,940/- LESS:30% DISALLOWANCE AS PER THE DECISION OF THE TRIBUNAL FOR A.Y. 2010-11 RS. 4,16,082/- RS.9,70,858/- 13. IN VIEW OF ABOVE THE AGRICULTURE INCOME OF THE ASSESSEE IS COMPUTED AT RS.19,00,204/- (RS.9,29,346 + 9,70,858/-). WE THEREFORE IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS RESPECTFULLY A PPLYING THE DECISION OF THE CO-ORDINATE BENCH IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010-11 ARE OF THE VIEW TH AT OUT OF THE TOTAL CLAIM OF AGRICULTURE INCOME OF RS.22,7 8,600/- WE ALLOW THE CLAIM OF AGRICULTURE INCOME AT RS.19,0 0,204/- AND CONFIRM THE ADDITION FOR INCOME OF RS.3,78,396/ - TO BE TREATED AS INCOME FROM OTHER SOURCES THEREBY PARTLY ALLOWING THE ASSESSEES APPEAL IN THE CASE OF SHRI SATINDER SINGH KHANDPURE, ITA NO.463/IND/2017. SATINDER SINGH & BHUPENDER SINGH ITANO.463 & 464/IND/2017 12 14. NOW WE TAKE UP APPEAL OF THE ASSESSEE SHRI BHUPEND RA SINGH KHANDPURE, ITANO.464/IND/2017. AS AGREED BY BOTH THE PARTIES ARE THAT THE FACTS AND FIGURES ARE THE SAME AND THE LAND IS JOINTLY OWNED BY THREE CO-OWNERS, WE THERE FORE APPLYING OUR OWN DECISION IN PARA 12 ABOVE PARTLY A LLOW THE ASSESSEES APPEAL BY RESTRICTING THE ADDITION FOR I NCOME FROM OTHER SOURCES AT RS.3,78,396/- AND ALLOW THE CLAIM OF AGRICULTURE INCOME AT RS.19,00,204/- AS AGAINST RS.22,78,600/- CLAIMED BY THE ASSESSEE. ASSESSEE GE TS PART RELIEF. 15. IN THE RESULT BOTH THE APPEALS OF TWO DIFFERENT AS SESSEES BEING ITA NO.463&464/IND/2017 ARE PARTLY ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 29.04.20 19. SD/- SD/- ( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER / DATED : 29 APRIL, 2019 /DEV COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER, ASSTT.REGISTRAR, I.T.A.T., INDORE