Shri Rajendra Shukla, Bhopal V. The Assitant Commissioner of Income Tax 3(1), Bhopal

ITA 570/IND/2010

• Counselvise Citation: 57022714 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 30-08-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 01-09-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ARUN DEWAN
• Assessee Lawyers: R N GUPTA
• Section: 143(3); 153A; 234B

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER 1. ITA NO.564/IND/2010 A.Y. 2006-07 2. ITA NO.565/IND/2010 A.Y. 2006-07 3. ITA NO.566/IND/2010 A.Y. 2006-07 4. ITA NO.567/IND/2010 A.Y. 2006-07 5. ITA NO.568/IND/2010 A.Y. 2006-07 6. ITA NO.569/IND/2010 A.Y. 2006-07 7. ITA NO.570/IND/2010 A.Y. 2006-07 1. SHRI PRAKASH SHUKLA BHOPAL PAN ACIPS-9732P 2. SMT. PRATIMADEVI SHUKLA BHOPAL PAN ACIPS-9729E 3. SHRI RAMESHCHAND SHUKLA BHOPAL PAN ACIPS-9734M 4. SHRI BHARAT SHUKLA BHOPAL PAN ACIPS-9733N 2 5. SHRI B.L. SHUKLA BHOPAL PAN ACIPS-9732P 6. SMT. NEELAM DEVI SHUILA BHOPAL PAN ACIPS-9739G 7. SHRI RAJENDRA SHUKLA BHOPAL PAN ACIPS-9731Q ... APPELLANTS VS ASSISTANT COMMISSIONER OF INCOME TAX 3(1) BHOPAL ... RESPONDENT APPELLANTS BY : SHRI R.N. GUPTA RESPONDENT BY : SHRI ARUN DEWAN DATE OF HEARING : 13.10.2011 DATE OF PRONOUNCEMENT : 13.10.2011 O R D E R PER JOGINDER SINGH THESE APPEALS HAVE BEEN FILED BY DIFFERENT ASSESSEE S ON COMMON GROUNDS. WE, THEREFORE, PROPOSE TO DISPOSE OF THESE APPEALS BY THIS CONSOLIDATED ORDER FOR THE SAKE OR CONVENIENCE. 3 THE ONLY GRIEVANCE RAISED IN THESE APPEALS PERTAINS TO AGRICULTURAL INCOME OF THE AMOUNTS AS DETAILED IN T HE GROUNDS OF APPEALS ON THE PLEA THAT LEARNED COMMISSIONER OF IN COME TAX (APPEALS) IS NOT JUSTIFIED IN NOT ACCEPTING THE AGR ICULTURAL INCOME SHOWN BY THE RESPECTIVE ASSESSEES FROM THE L AND OWNED AND TAKEN ON LEASE FROM DIFFERENT PERSONS. 2. DURING HEARING OF THESE APPEALS, WE HAVE HEARD S HRI R.N. GUPTA, LD. COUNSEL FOR ASSESSEE AND SHRI ARUN DEWA N, LEARNED SR. DR. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS IDENTICAL TO THE GROUNDS RAISED IN THE RESPECTIVE APPEALS BY FURTHER SUBMITTING THAT THERE WAS APPROX IMATELY 45 ACRES OF LAND TAKEN ON LEASE. ON A QUERY FROM THE BENCH AS TO WHAT LEASE RENT WAS PAID TO THE LAND OWNERS, IT WAS EXPLAINED THAT AGRICULTURAL PRODUCE EQUIVALENT TO THE AMOUNT OF RS. 1,60,000/- WAS PAID TO THE LAND OWNERS AS LEASE REN T. OUR ATTENTION WAS ALSO INVITED TO THE DECISION OF THE T RIBUNAL IN THE CASE OF SMT. SAMITA BINOD AND SMT. SIMI VISHNU (ITA NO. 88/IND/2010) WHEREIN THE AGRICULTURAL INCOME TO THE EXTENT OF RS. 22,000/- PER ACRE WAS DIRECTED TO BE ACCEPTED. FURTHER 4 ATTENTION WAS INVITED TO THE ASSESSMENT ORDER FRAME D U/S 153A READ WITH SECTION 143(3) OF THE ACT IN THE CASE OF SHRI MUKESH SHARMA WHEREIN IT WAS OBSERVED BY THE LEARNED ASSES SING OFFICER THAT AN INCOME OF RS. 20,000/- PER ACRE WAS DERIVED IN THE ASSESSMENT YEAR 2003-04 AND 2004-05. THIS ASSE RTION OF THE ASSESSEE WAS NOT CONTROVERTED BY THE REVENUE. HOWEVER, THE LEARNED SR. DR CONTENDED THAT IT DEPENDS UPON T HE AREA WHERE THE LAND IS SITUATED TO WHICH THE LD. COUNSEL FOR ASSESSEE CONTENDED THAT THE LAND IN THE CASE OF SHR I MUKESH SHARMA (ASSESSMENT ORDER) AS WELL AS SMT. SAMITA BI NOD AND SMT. SIMI VISHNU (ORDER OF THE TRIBUNAL) THE LANDS ARE SITUATED IN THE AREA OF BHOPAL. IT WAS ALSO CONTENDED THAT THE FACTS IN ALL THESE APPEALS ARE IDENTICAL. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON FILE. IN THE CASE OF SHRI PRAKASH SHUKLA (ITA NO. 564/IND/2010) THE FACTS IN BRIEF AR E THAT THE ASSESSING OFFICER DISALLOWED THE AGRICULTURAL INCOM E BY TREATING THE SAME AS TAXABLE. THE STAND OF THE ASSESSING OFF ICER IS THAT THOUGH AGRICULTURAL INCOME OF RS. 6 LACS HAS BEEN S HOWN BY THE 5 ASSESSEE BUT NO BOOKS OF ACCOUNT ARE MAINTAINED BY HIM. THE SHOWED AGRICULTURAL INCOME WAS ALSO FOUND TO BE TOW ARDS HIGHER SIDE. IN ITS RETURN THE ASSESSEE DISCLOSED AGRICULTURAL INCOME OF RS. 6 LACS FROM 57.76 ACRES OF FULLY IRRI GATED AGRICULTURAL LAND. BEFORE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) THE STAND OF THE ASSESSEE IS THAT AGRICUL TURAL ACTIVITIES WERE DULY CARRIED OUT BY THE ASSESSEE BUT THE SAME WERE DISCARDED BY THE ASSESSING OFFICER. IT WAS FURTHER CLAIMED THAT THE ASSESSEE BELONGS TO AN AGRICULTURAL FAMILY AND IN THE PAST FROM SEVERAL YEARS THE ASSESSEE FAMILY IS HAVING AG RICULTURAL INCOME AND THE SAME WAS SHOWN IN THE RETURNS OF RES PECTIVE YEARS. IT WAS FURTHER CLAIMED THAT IN PAST ASSESSM ENT YEARS THE AGRICULTURAL INCOME ALL ALONG HAS BEEN ACCEPTED. T HE RELEVANT PORTION OF SUCH CLAIM IS SUMMARISED AS UNDER :- ASSESSMENT YEAR INCOME SHOWN IN RETURN PARTICULARS OF ASSESSMENT REMARKS AREA OF AGRI LAND REMARKS TOTAL INCOME AGRI. INCOME TOTAL INCOME AGRI INCOME 2006-07 693230 600000 1373230 0 52.755 ACRE AGRI. INCOME RS. 600000 IS TREATED AS TAXABLE INCOME BY THE A.O. 6 2005-06 786980 320000 780980 320000 42.47 ACRES ORDER U/S 143(1) DATED 22.06.2006 - ACCEPTED 2004-05 738240 320000 738240 320000 42.47 ACRES ORDER U/S 143(1) DATED 8.11.2006 - ACCEPTED 2003-04 698979 320000 698980 320000 42.47 ACRES ORDER U/S 143(1) DATED 11.11.2003 - ACCEPTED 2002-03 633270 300000 633270 300000 42.47 ACRES ACCEPTED 2001-02 273513 280000 273513 280000 42.47 ACRES ACCEPTED THE FINDINGS OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ARE REPRODUCED HEREUNDER :- I HAVE GONE THROUGH THE ASSESSMENT ORDER AND SUBM ISSION OF THE LD. COUNSEL FURNISHED BEFORE ME ALONG WITH S UPPORTING EVIDENCE. THE APPELLANT WAS IN POSSESSION OF AGRIC ULTURAL LAND WHICH IS NOT DISPUTED BY THE A.O. THE ASSESSEE HAS SUPPORTED THE AGRICULTURAL INCOME BY SUBMITTING THE MANDI SAL E RECEIPT OF KRISHI UPAJ MANDI. COPY OF KHASRA NAKALS OF THE AG RICULTURAL LAND AND THE KOLI PATTA AGREEMENTS. ALL THESE DOCUM ENTS HAVE NOT BEEN DOUBTED AND THE GENUINENESS HAS NOT BEEN D ISPUTED. IT IS NOT THE FIRST YEAR IN WHICH THE ASSESSEE HAS INCOME SHOWN FROM AGRICULTURE BUT HE HAS THE SAID SOURCE OF INCO ME IN EARLIER YEARS ALSO IN WHICH SAID INCOME HAS BEEN ACCEPTED. THUS, THE DISALLOWANCE OF ENTIRE AGRICULTURAL INCOME SHOWN BY THE APPELLANT IS NOT JUSTIFIED. DURING THE YEAR THE AP PEAL HAS MADE SALES OF AGRICULTURAL PRODUCE AT RS.6,07,783/- AND THE NET INCOME SHOWN IS RS.6,00,000/- ON TOTAL LAND AT 52.7 5 ACRES OUT OF WHICH 7.65 ACRES IS SELF OWNED AND 45.11 IS THE LAND TAKEN ON LEASE. IT IS NOTICED FROM THE DETAILS FILED THAT T HE LAND IS IRRIGATED AND TWO CROPS ARE GROWN ON THEREON. AS REGARDS EXP ENSES IT WAS CONTENDED THAT MAJORITY OF THE EXPENSES HAVE BE EN INCURRED IN KIND BY WAY OF CROPS/GRAINS BUT THE APP ELLANT HAS NOT FURNISHED DETAILS REGARDING EXPENSES INCURRED ON SU CH AGRICULTURAL ACTIVITY. FURTHER, DURING THE ASSESSM ENT PROCEEDINGS THE APPELLANT HAS ALSO ACCEPTED THAT AG RICULTURAL INCOME IS SHOWN ON ESTIMATES ONLY. AS THE APPELLAN T HAS NOT 7 FURNISHED DETAILS AND SUPPORTING VOUCHERS FOR EXPEN SES INCURRED ALONG WITH COMPLETE DETAILS FOR THE SALE PROCEEDS, IN THESE CIRCUMSTANCES AGRICULTURAL INCOME CAN ONLY BE ESTIM ATED ON REASONABLE BASIS. IT IS PERTINENT TO NOTE THAT AGRICULTURAL INCOME SH OWN BY THE APPELLANT DURING THE LAST FIVE YEARS HAS BEEN ACCEP TED BY THE DEPARTMENT. IN PREVIOUS YEAR 2003-04 RELEVANT TO A .Y. 2004-05 AGRICULTURAL INCOME TO THE EXTENT OFRS. 3,20,000/- WAS DISCLOSED BY THE APPELLANT FROM 42.47 ACRES OF LAND OUT OF WH ICH 7.65 ACRES WAS OWNED BY HIM AND 34.82 WAS TAKEN ON LEASE . THE AGRICULTURAL INCOME SHOWN WAS RS. 7,500/- PER ACRE. THE AGRICULTURAL INCOME SHOWN BY THE APPELLANT WAS ACCE PTED BY THE A.O. IN THE ASSESSMENT COMPLETED U/S 143(3) OF THE INCOME TAX ACT. SINCE THEN THERE IS A GAP OF 2 TO 3 YEARS AND THE YIELD OF CROPS AS WELL AS PRICES OF AGRICULTURAL PROCEEDS HA VE RISEN CONSIDERABLY. IN VIEW OF THE SAME, THE AGRICULTURA L INCOME HAS INCREASED SINCE THEN AND, THEREFORE, IT WOULD BE FA IR AND REASONABLE TO ESTIMATE AGRICULTURAL INCOME @ RS. 8, 000/- PER ACRE PER ANNUM. AS THE APPELLANT DURING THE YEAR H AS CULTIVATED 52.75 LAND HENCE NET AGRICULTURAL INCOME ESTIMATED @ RS. 8,000/- PER ACRE WHICH COMES TO RS. 4,22,000/-. TH E BALANCE AMOUNT OF RS. 1,78,000/- (RS. 6,00,000 RS. 4,22,0 00) WILL BE TREATED AS THE APPELLANTS INCOME FROM OTHER SOURCE S AND WILL BE TAXED ACCORDINGLY. WE ARE ALSO REPRODUCING HEREUNDER THE CONCLUDING PA RT OF THE ORDER OF THE TRIBUNAL IN THE CASE OF SMT. SMITA BIN OD (ITA NO. 88/IND/2010) DATED 28 TH MARCH, 2011 :- THE RELEVANT PORTION OF THE ORDER OF THE TRIBUNAL DATED 28.3.2011 IS REPRODUCED HEREUNDER :- 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIE S BELOW AND THE DETAILED CHART OF PRODUCTION AND SALE OF VARIOUS PRODUCE LIKE WHEAT, CHANA, SOYA, PLACED ON RECORD DULY INDICATING THE MONTH OF PRODUCTION AND ALSO DATE OF SALE, RATE AT WHICH THE PRODUCE WA S SOOD. THE ASSESSEE HAD ALSO GIVEN DETAILED BREAK UP OF THE VARIOUS EXPENDITURE INCURRED FOR PRODUCIN G 8 THESE CROPS WHICH IN TITAL AMOUNTED TO RS. 1,99,500/-. THUS, THE TOTAL NBET INCOME OF RS. 6,21,270/- WAS SHOWN IN RESPECT OF LAND OF 18.86 ACRES IN RATANPUR AREA, BHOPAL, YIELDING AVERAGE RATE OF RS. 33,000/- PER ACRE. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ESTIMATED RS. 15,000/- PER ACRE. KEEPING IN VIEW THE DETAILS FURNISHED BY THE ASSESSEE AS NARRATED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IN HIS ORDER WHICH HAS NOT BEEN CONTROVERTED, IT WOULD BE MOST REASONABLE TO ESTIMATE THE INCOME AT RS. 22,000/- PER ACRE OF LAND FOR COMPUTING THE AGRICULTURAL INCOME SHOWN BY THE ASSESSEE WITH RESPECT TO VARIOUS CROPS. THE ASSESSING OFFICER IS DIRECTED TO RECOMPUTED THE AGRICULTURAL INCOME BY TAKING THE INCOME OF RS.22,000/- PER ACRE OF LAND. WE DIRECT ACCORDINGLY. 9. IN THE RESULT, THE APPEAL IS ALLOWED IN PART IN TERMS INDICATED ABOVE. 4. IF THE AFORESAID CONCLUSION DRAWN BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) AND THE ORDER OF THE TRIBUNAL ARE ANALYSED, WE FIND THAT THE LEARNED COM MISSIONER OF INCOME TAX (APPEALS) HAS NOT DISPUTED GROWING OF CROPS ON THE TOTAL LAND AT 52.75 ACRES (7.65 ACRES OWNED BY THE ASSESSEE AND 45.11 ACRES TAKEN ON LEASE). THE LEARN ED APPELLATE COMMISSIONER HAS ESTIMATED THE AGRICULTUR AL INCOME PER ACRE AT RS. 8,000/- PER ACRE PER ANNUM. NOW THE QUESTION ARISES WHETHER SUCH ESTIMATION IS FAIR AND REASONAB LE ? 9 WITHOUT COMING TO ANY CONCLUSION, THE OPINION OF TH E DEPARTMENT IN THE CASE OF SHRI MUKESH SHARMA (SUPRA ) WHEREIN THE INCOME HAS BEEN ESTIMATED AT RS. 20,000/- PER A CRE AND THE TRIBUNAL HAS DIRECTED SUCH ESTIMATION AT RS. 22 ,000/- PER ACRE IN THE CASE OF SMT. SMITA BINOD (SUPRA). IF T HESE ESTIMATIONS ARE KEPT IN JUXTAPOSITION WITH THE FACT S OF THE PRESENT APPEALS, WE FIND THAT FOR 45.11 ACRES (TAKE N ON LEASE) THE ASSESSEE HAS PAID LEASE RENT, THEREFORE, THE NE T AGRICULTURAL INCOME MAY BE LESSER. THE ASSESSEE IN HIS RETURN H AS CLAIMED THE AGRICULTURAL LAND PER ACRE ARE RS. 11,521/- FRO M THE IRRIGATED LAND, IN OUR VIEW, WHICH IS QUITE AND REASONABLE, T HEREFORE, WE DIRECT THE LEARNED ASSESSING OFFICER TO ALLOW THE A GRICULTURAL PRODUCTION AT THE RATE OF RS. 11,521/- PER ACRE. TH EREFORE, THE STAND OF THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) IS MODIFIED TO THIS EXTENT ONLY. 5 . SINCE THE IDENTICAL ISSUES ARE INVOLVED IN REMAININ G APPEALS, THEREFORE, OUR AFORESAID DECISION WILL BE APPLICABLE TO THESE APPEALS ALSO ON THE SAME TERMS AND CONDITIONS . 10 6. THE NEXT GROUND PERTAINS TO LEVY OF INTEREST U/S 234B AND 234D OF THE ACT. IN THE LIGHT OF THE ABOVE DECISIO N, THE SAME WILL BE CONSEQUENTIAL IN NATURE. ALL THESE APPEALS ARE DISPOSED OF IN THE AFORESAID MANNER. SD SD (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 13.10.2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE DN/-