A.N. Kumar Raju, Bangalore V. ITO, Bangalore

ITA 579/BANG/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 2048 (ITAT-BANGALORE)
• Duration Of Justice: 6 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2009
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 11-11-2009
• Assessment Year: 2005-2006
• Appeal Filed On: 05-06-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: JACINTA ZIMIK VASHAI
• Assessee Lawyers: H A K RAO
• Keywords: Unexplained cash credit; Principle of natural justice
• Section: 68; 144; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI K.P.T. THANGAL, VICE PRESIDENT AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NOS. 522 & 579/BANG/2009 ASSESSMENT YEAR : 2005-06 A.N. KUMAR RAJU, 164, 28 TH MAIN, J.P. NAGAR, 2 ND MAIN, BANGALORE 560 078. : APPELLANT VS. THE INCOME TAX OFFICE, WARD 4(3), BANGALORE. : RESPONDENT APPELLANT BY : SHRI H.A.K. RAO RESPONDENT BY : SMT. JACINTA ZIMIK VASHAI O R D E R PER A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER THESE TWO APPEALS OF THE ASSESSEE AN INDIVIDUAL ARE DIRECTED AGAINST THE ORDERS OF THE CIT(A)-II, BANGALORE, FOR THE ASSESSMENT YEAR 2005-06. ITA NO: 522/09 U/S 144 OF THE ACT : 2. THE ASSESSEE HAS RAISED SIX GROUNDS OF APPEAL. THE GROUND NOS:1 AND 6 ARE GENERAL AND NO SPECIFIC ISSUES INVO LVED WHICH, IN OUR CONSIDERED VIEW, DO NOT SURVIVE FOR ADJUDICATION. IN THE REMAINING GROUNDS, ITA NO.522 & 579 /BANG/ PAGE 2 OF 12 THE ESSENCE AND SUBSTANCE OF THE ISSUES, FOR THE SA KE OF CONVENIENCE, ARE REFRAMED IN CONCISE MANNERS AS UNDER: THE CIT(A) HAS ERRED IN CONCLUDING (I) RS. 8 LAKHS RECEIVED FROM BALASUBRAMANYA, VENDOR OF THE PROPERTY SOLD TO THE ASSESSEE FOR OBTAINING DD TOWARDS STAMP DUTY AND REGISTRATION CHARGES WAS UNEXPLAINED AMOUNT OF THE ASSESSEE; (II) THE HUF OF THE ASSESSEE WAS NOT IN A POSITION TO AD VANCE RS.6 LAKHS AS ON 1.7.04; (III) THE ASSESSEE HAD NOT EXPLAINED THE SOURCES OF INVES TMENT OF RS.85 LAKHS IN PURCHASE OF A HOUSE; & (IV) THAT THE AGRICULTURAL INCOME FROM 22 ACRES OF LAND WOULD BE ONLY RS.50000/- AS AGAINST RS.1 RETURNED. ITA NO: 579/09 U/S 154 OF THE ACT : 3. IN THIS APPEAL, EVEN THOUGH THE ASSESSEE HAS RAI SED FOUR GROUNDS, THE CRUXES OF THE ISSUES ARE THAT (I) THE AO ERRED IN CONCLUDING IN THE ORDER PASSED U/S 154 OF THE ACT AS A VALID ORDER AND ALSO BY INCREASING THE INCOME BY RS.22 LAKHS WHICH IS CONTRARY TO THE EVIDENCE ADDUCED; & (II) THE CIT(A) ERRED IN HOLDING RS.5 LAKHS WAS THE UNEX PLAINED INVESTMENT IN THE PURCHASE OF A HOUSE FOR 85 LAKHS. 4. THE FACTS OF THE ISSUES, IN BRIEF, ARE THAT THE ASSESSEE HAD FURNISHED A ROI ADMITTING A TOTAL INCOME OF RS.2.48 LAKHS PLU S INCOME FROM AGRICULTURE AT RS.1 LAKH. IN THE ABSENCE ANY COMPL IANCE TO THE NOTICES ISSUED, THE AO CONCLUDED THE ASSESSMENT U/S 144 OF THE ACT. WHILE DOING SO, HE HAD BROUGHT TO TAX THE FOLLOWING AMOUNTS: ITA NO.522 & 579 /BANG/ PAGE 3 OF 12 1. INVESTMENTS MADE IN PURCHASE OF PROPERTY PURPORTED TO BE OUT OF PAST SAVINGS RS.220 0000 2. CASH DEPOSITS IN THE ACCOUNT WITH VIJAYA BANK 9288000 3. MUNICIPAL TAXES & REPAIRS CLAIMS TOGETHER 298170 4. INTEREST CLAIM FOR HAVING PAID ON THE RECEIPTS OF SECOND PROPERTY 189000 5. INCOME FROM AGRICULTURE AS UNEXPLAINED CASH CREDITS OF 100000 ACCORDINGLY, THE AO HAD DETERMINED THE TOTAL INCOME AT RS.1.02 CRORES. 5. AGGRIEVED, THE ASSESSEE HAD APPROACHED THE CIT(A ) FOR REDRESSAL. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE A ND ALSO THE REMAND REPORT OF THE AO, THE CIT(A) HAD UPHELD THE STAND O F THE AO ON THE FOLLOWING ITEMS FOR THE REASONS SET-OUT IN THE IMPU GNED ORDER WHICH ARE SUMMARIZED CONCISELY: I. R.N.SUBRAMANYA CASH OF RS.8 LAKHS : 3.5. I HAVE VERIFIED THE CASH BOOK AND BANK STATE MENTS AND IT HAS REVEALED THAT AN AMOUNT OF RS.800000/- WAS ENTERED IN THE CA SH BOOK ON 18/5/04. OUT OF THAT, AN AMOUNT OF RS.550000/- WAS DEPOSITED IN THE BANK ACCOUNT WITH VIJAYA BANK, SOUTH END ROAD BRANCH ON 19/5/04 AND T HE BALANCE AVAILABLE AS ON 23/5/04 WAS ONLY RS.554629/-, OUT OF THAT DD FOR RS.546000/- WAS PURCHASED FOR LOAN REPAYMENT AND BALANCE REMAIN RS. 8620/-ONLY WHEREAS DD HAS BEEN PURCHASED FOR RS.761000/- FOR STAMP DUT Y AND REGISTRATION AND CASH PAYMENT OF RS.86000/- WAS MADE. FROM THE CASH BOOK, NO FURTHER WITHDRAWALS APPEAR DURING THE MONTH OF MAY, 04, FOR PURCHASE OF DD FOR STAMP DUTY AND REGISTRATION CHARGES, TOTALING TO RS .847000/-. THUS, FROM THESE ENTRIES, THE SOURCE OF DEPOSIT OF RS.800000/- ARE UNEXPLAINED. THEREFORE, THE ADDITION IS CONFIRMED. II. HUF ACCOUNT - RS.6 LAKHS: AFTER SCRUTINIZING THE DETAILS FILED SUCH AS INCOME -TAX RETURNS OF HUF AND LEDGER ACCOUNT, THE CIT(A) HAS OBSERVED THUS -, 3.10. AS PER LEDGER ACCOUNT RS.360200 IS SHOWN AS PAYMENTS TO HUF THROUGH THE SB ACCOUNT NO.20442 WITH VIJAYA BANK. AFTER CLOSE VERIFICATION WITH THE BANK STATEMENT, THE FOLLOWING POINTS EMERG E: ITA NO.522 & 579 /BANG/ PAGE 4 OF 12 - AMOUNT SHOWN TOWARDS SELF WITHDRAWALS NOT AS PAYMEN TS TO HUF OR CLEARING; - CHEQUE NUMBER MENTIONED IN THE LEDGER ACCOUNT IS NO T APPEARING IN THE BANK STATEMENT; - AMOUNT PAID OF RS.2 LAKHS AS SELF WITHDRAWALS NO CHEQUE APPEARS IN THE BANK STATEMENT. IN VIEW OF THE FACT THAT THE NATURE AND SOURCES ABO UT THE ALLEGED RECEIPT IN CASH ARE NOT PROVED, THE APPELLANT DID NOT PRODUCE PRIMARY EVIDENCE LIKE LOAN CONFIRMATION AND ALSO BOOKS OF ACCOUNT TO SUBS TANTIATE HIS CLAIM. THUS, THE CASH RECEIPT OF RS.600000/- IS CONSIDERED AS UN EXPLAINED. III. INVESTMENT IN PROPERTY [RS.85 LAKHS] RS.5 LAKH S: 3.16. THUS, IT MAY BE SEEN THAT TRANSACTION WITH R.N. BALASUBRAMANYA APPEARED AS INVESTMENT IN PROPERTY RS.500000/- CLAI MED TO BE PAID VIDE CHEQUE NO:863358 DT: 24/5/04. SUBSEQUENTLY, THE AP PELLANT CLAIMED TO HAVE RECEIVED A SUM OF RS.800000/- AS CASH ON 1/7/04. F ROM HIS WRITTEN SUBMISSION, IT TRANSPIRES THAT THE APPELLANT HAD IS SUED TWO CHEQUES (I) NO.863358 FOR RS.500000/- ON 9.7.04 AND NO.863359 F OR RS.300000/- ON 9.7.04. IN VIEW OF THIS FACT, IT IS NOT CLEAR THAT CHEQUES ISSUED BEARING NO.863358 FOR REPAYMENT OF RS.800000/-, OR IT REPRE SENT PAYMENT TO R.N. BALASUBRAMANYA TOWARDS PAYMENT OF PURCHASE CONSIDER ATION OF THE PROPERTY. FURTHER, IT WAS CLAIMED THAT HE PAID CAS H OF RS.500000/- DURING THE FY 03-04. HOWEVER, NO DETAILS WERE FURNISHED I N SUPPORT OF THIS CLAIM. THE FACTS STATED ABOVE THE APPELLANT HAS NOT EXPLAI NED THE INVESTMENT SATISFACTORILY, HENCE, INVESTMENT TO THE EXTENT OF RS.500000/- REMAINS CONSIDERED UNEXPLAINED, THEREFORE, THE ADDITION OF RS.500000/- IS HEREBY CONFIRMED. IV. AGRICULTURAL INCOME: RS. 1 LAKH: .AT THE TIME OF APPEAL HEARING ALSO, THE APPELLAN T COULD NOT FURNISH DOCUMENTARY EVIDENCE. HOWEVER, CONSIDERING HIS LAN D HOLDINGS, THE ESTIMATE OF INCOME FROM AGRICULTURE IS RESTRICTED T O RS.50000/-. 6. DISENCHANTED WITH THE RELIEF ALLOWED BY THE CIT (A), THE ASSESSEE HAS COME UP WITH THE PRESENT APPEAL. THE LD. AR R EITERATED MORE OR LESS WHAT HAS BEEN CONTENDED BEFORE THE FIRST APPELLATE AUTHORITY. BUTTRESS HIS ARGUMENT, HE CAME UP WITH A VOLUMINOUS PAPER BOOK C ONTAINING 1 115 PAGES WHICH CONSIST OF, INTER ALIA, COPIES OF (I) L ETTER FROM VIJAYA BANK ITA NO.522 & 579 /BANG/ PAGE 5 OF 12 REGARDING ISSUANCE OF THREE DDS, PASS SHEET OF THE VIJAYA BANK, S.E.ROAD BRANCH, (II) LEDGER EXTRACT OF AGRL. INCOME AND EXP . (III) CASH BOOK FOR THE PERIOD UNDER DISPUTE, (IV) LOAN ACCOUNT OF VIJAYA B ANK AND STATEMENT FROM BANK, (V) HUF A/C AS PER BOOKS OF THE ASSESSEE ETC. , 6.1. ON THE OTHER HAND, THE LD. D R WAS VERY EMPHAT IC IN HER RESOLVES THAT THE FIRST APPELLATE AUTHORITY HAD, IN FACT, DE LIBERATED THE ISSUES IN AN EXHAUSTIVE MANNER AND HAD CONFIRMED THE STAND OF TH E AO FOR THE REASONS SET OUT IN THE IMPUGNED ORDER WHICH IS UNDER APPEAL . IT, WAS, THEREFORE, PLEADED THAT THE IMPUGNED ORDER OF THE LD. CIT (A) DOESNT REQUIRES ANY INTERFERENCE WHICH MAY BE SUSTAINED IN TOTO. SHE H AS ALSO PLACED RELIANCE ON THE RULING OF HONBLE HIGH COURT OF ALLAHABAD RE PORTED IN 304 ITR 239 TO DRIVE HOME HER POINT. 7. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND ALSO PERUSED THE RELEVANT RECORDS. WE HAVE ALSO GONE TH ROUGH THE VOLUMINOUS PAPER BOOK FURNISHED BY THE LD. A.R. I. R.N.SUBRAMANYA CASH OF RS.8 LAKHS: 7.1 WITH REGARD TO THE CASH OF RS.8 LAKHS, THE CONC LUSION OF THE CIT(A) WAS THAT THERE WAS NO FURTHER WITHDRAWALS FROM THE CASH BOOK OF THE ASSESSEE DURING MAY 2004 FOR PURCHASE OF DD, STAMP DUTY ETC., AND THUS THE SOURCE OF DEPOSIT OF RS.8 LAKHS WAS UNEXPLAINED . AS COULD BE SEEN FROM THE PAPER BOOK (ON PAGE 89) F URNISHED, THE VIJAYA BANK IN ITS LETTER DATED: 14.8.2009 HAD CONFIRMED T HAT ITA NO.522 & 579 /BANG/ PAGE 6 OF 12 WE HAVE ISSUED 3 DDS ON 23.5.2004 AS MENTIONED BEL OW, OUT OF RS.63 LAKHS LOAN GIVEN BY US AND BY DEBIT OF RS.5,46,000/- TO Y OUR S.B.ACCOUNT NO.20442 WITH OUR BRANCH ON THE SAME DATE: (I) DD NO.977454 RS.6000000 IN FAVOUR OF R.N.SUBRAMAN YA (II) DD NO:977452 RS. 761000 SUB-REGISTRAR, BANGALORE, (III) DD NO:977453 RS. 85000 S.R. KENGERI, BANGALORE THUS, IN OUR CONSIDERED VIEW, THE SOURCE OF DEPOSIT OF RS.8 LAKHS STANDS VINDICATED. SINCE THIS PIECE OF INFORMATION WAS NO T FURNISHED/BEFORE THE AO DURING THE ASSESSMENT OF PROCEEDINGS, IN THE INTERE ST OF NATURAL JUSTICE AND EQUITY, THIS ISSUE IS REMITTED BACK ON THE FILE OF THE AO FOR A FRESH LOOK IN CONFORMITY WITH THE BANKS LETTER REFERRED SUPRA. IT IS ORDERED ACCORDINGLY. II. HUF ACCOUNT - RS.6 LAKHS: 8. THE CIT(A), FOR THE REASONS SET-OUT IN THE IMPU GNED ORDER AND ALSO EXTRACTED IN THIS ORDER [ PARA NO: 5. II SUPRA], HA D CONSIDERED THIS AS UNEXPLAINED AND CONFIRMED THE ADDITION. 8.1 THE CONTENTION OF THE ASSESSEE WAS THAT THE HUF [A.N.KUMAR RAJU HUF] HAD A TAXABLE INCOME AND THAT OUT OF INCOME OF HUF, HE HAD UTILIZED RS.6 LAKHS ON 1.7.04 FOR HAVING DEPOSIT MA DE BY HIM IN HIS BANK ACCOUNT WITH VIJAYA BANK. 8.2 IT WAS CONTENDED BY THE LD. D R PRESENT THAT TH E SAID SUM OF RS.6 LAKHS HAD NOT GONE OUT IN LEDGER ACCOUNT OF HUF. 8.3 THE HUF IS BEING ASSESSED TO TAX FROM THE AY 19 98-99 ONWARDS AND WE HAVE PERUSED SARAL FORMS AND ASSESSMENT ORD ERS PASSED FOR THE AYS 2002-03, 03-04 ETC. [ON PAGES 71 79 OF PB] DE TERMINING ITS INCOMES AT RS.2.30 LAKHS AND RS,2.88 LAKHS (INCLU.AGRL.INC OME OF RS.1.80 LAKHS) ITA NO.522 & 579 /BANG/ PAGE 7 OF 12 RESPECTIVELY. SINCE THE ASSESSEE BEING A KARTA OF HUF HAVING CONSIDERABLE INCOME, IN OUR UNANIMOUS VIEW, THE UTI LIZATION OF A SUM OF RS.6 LAKHS BY THE ASSESSEE FROM THE INCOME OF THE H UF CANNOT BE DISBELIEVED. ON 1.7.04, THE HUF HAD CASH ON HAND OF RS.6 LAKHS (PAGE 114 OF PB). IN VIEW OF THE MATTER, WE ARE OF THE FIRM VIEW THAT THE SOURCE OF RS.6 LAKHS STANDS EXPLAINED AND, ACCORDINGLY, DELET E THE SAME. 8.4 WE HAVE ALSO DULY CONSIDERED THE FINDING OF THE HONBLE HIGH COURT OF ALLAHABAD IN THE CASE OF BANARSI PRASAD V. CIT REPORTED IN 304 ITR 239 WHEREIN THE HONBLE COURT HAD RULED THAT IF THE ASSESSEE FAILED TO FURNISH THE INFORMATION ABOUT THE SOURCE FROM WHICH HIS WIF E AND MINOR SON OBTAINED MONEY FOR INVESTING WITH THE ASSESSEE, THE MERE EXPLANATION REGARDING THE SOURCE OF THE RECEIPT OR CREDITS IN T HE ACCOUNT BOOKS OF THE ASSESSEE, VIZ., THAT HE RECEIVED THE MONEY FROM HIS WIFE AND MINOR SON, IS FAR FROM 'SATISFACTORY'. WHEN THE CREDITS WERE RECEIVED BY THE ASSESSEE FROM CLOSE RELATIVES LIKE HIS NON-EARNING WIFE AND MINOR SON, THE EXPLANATION TO BE FURNISHED UNDER SECTION 68 IN ORDER TO QUALIFY A S 'SATISFACTORY' WOULD REQUIRE TO DISCLOSE THE SOURCE OF THE DEPOSITOR FOR ESTABLISHING THE 'CAPACITY' OF THE CREDITOR. 8.5 WITH RESPECTS, WE WOULD LIKE TO POINT OUT THAT THE RULING CITED BY THE LD.D.R DOESNT FIT TO THE ISSUE ON HAND WHICH IS ON THE DIFFERENT FOOTING AND THUS DISTINGUISHABLE . III. INVESTMENT IN PROPERTY [RS.85 LAKHS] RS.5 LAKH S: 9. WITH REGARD THE PAYMENT OF RS.5 LAKHS, WE ARE AG AIN REPRODUCING THE FINDING OF THE CIT(A) TO CLEAR THE AIR, AS UNDE R: ITA NO.522 & 579 /BANG/ PAGE 8 OF 12 3.16. THUS, IT MAY BE SEEN THAT TRANSACTION WITH R.N. BALASUBRAMANYA APPEARED AS INVESTMENT IN PROPERTY RS.500000/- CLAI MED TO BE PAID VIDE CHEQUE NO:863358 DT: 24/5/04. SUBSEQUENTLY, THE AP PELLANT CLAIMED TO HAVE RECEIVED A SUM OF RS.800000/- AS CASH ON 1/7/04. F ROM HIS WRITTEN SUBMISSION, IT TRANSPIRES THAT THE APPELLANT HAD IS SUED TWO CHEQUES (I) NO.863358 FOR RS.500000/- ON 9.7.04 AND NO.863359 FOR RS.300000/- ON 9.7.04 . IN VIEW OF THIS FACT, IT IS NOT CLEAR THAT CHEQU ES ISSUED BEARING NO.863358 FOR REPAYMENT OF RS.800000/-, OR IT REPRE SENT PAYMENT TO R.N. BALASUBRAMANYA TOWARDS PAYMENT OF PURCHASE CONSIDER ATION OF THE PROPERTY . FURTHER, IT WAS CLAIMED THAT HE PAID CASH OF RS. 500000/- DURING THE FY 03-04. HOWEVER, NO DETAILS WERE FURNISHED I N SUPPORT OF THIS CLAIM. THE FACTS STATED ABOVE THE APPELLANT HAS NOT EXPLAI NED THE INVESTMENT SATISFACTORILY, HENCE, INVESTMENT TO THE EXTENT OF RS.500000/- REMAINS CONSIDERED UNEXPLAINED, THEREFORE, THE ADDITION OF RS.500000/- IS HEREBY CONFIRMED. 9.1 IT WAS CONTENDED BEFORE US THAT THE PURCHASERS [THE ASSESSEE AND HIS WIFE] HAVE PAID THE SALE CONSIDERATION OF RS.85 LAKHS IN THE FOLLOWING MANNER [ SOURCE: SYNOPSIS OF ARGUMENTS DT:11.11.09 ] : (A) DD NO:977454 DT: 23.5.04 VIJAYA BANK, S.E.ROA D BRANCH RS.6000000 (B) CH.NO.258721 DT.30.10.03 UNION BANK OF INDIA , BLORE 1500000 (C) CH.NO.258722 DT.30.10.03 UNION BANK OF INDI A, BLORE 500000 (D) CH.NO.863358 DT.24.5.04 VIJAYA BANK, S.E.ROAD B RANCH 500000 IT WAS FURTHER CLAIMED THAT THE SAID CHEQUE HAS BE EN CLEARED ON 31.7.2007 AS VERIFIED BY THE CIT(A). 9.2 HOWEVER, ON A GLIMPSE OF THE IMPUGNED ORDER, W E FIND THAT THE LD. CIT(A) HAD OBSERVED THAT - 3.6. FURTHER, IT IS ALSO CLAIMED THAT AN AMOUNT OF RS.800000/- WAS RECEIVED FROM R.N.BALASUBRAMANYA ON 1.7.04 WHICH HAS BEEN REPAID. ON VERIFICATION, IT WAS SEEN THAT THE SAME WAS REPAID ON 9.7.04 VIDE CHEQUE NO.863358 AND 863359 FOR A SUM OF RS.500000 AND RS.300000 RESPECTIVELY. THUS, THIS TRANSACTION STANDS EXPLAI NED. 9.3 AS A MATTER OF FACT THE CHEQUE NO.863358 FOR RS .5 LAKHS WAS PAID TO BALASUBRAMANYA BEING PART PAYMENT TOWARDS STAMP DUT Y, REGISTRATION ITA NO.522 & 579 /BANG/ PAGE 9 OF 12 CHARGES (IN TERMS OF CLAUSE 9 OF DEED OF SALE, BALA SUBRAMANYA HAD AGREED TO BEAR THE STAMP DUTY, REGISTRATION CHARGES) AND T HE CHEQUE WAS REALIZED ON 9.7.04 (PAGE 91 OF PB) AND NOT ON 31.7.2007 AS CLAIMED BY THE LD.A.R. IT IS FOR AN ARGUMENT-SAKE WITHOUT CONCEDIN G THAT HOW THE BANK AUTHORITIES COULD HAVE CLEARED A CHEQUE ON 31.7.2007 WHICH WAS PURPORTED TO HAVE BEEN DATED 24.5.04 WHICH IS A MOOT QUESTION TO BE PROBED. THUS, IT IS ABUNDANTLY CLEAR THAT THIS CHEQUE WAS ISSUED ALO NG WITH CHEQUE NO.863359 FOR RS.3 LAKHS TO SQUARE UP THE RS.8 LAKH S PAID BY BALASUBRAMANYA. 9.4 HOWEVER, THE ASSESSEE IN HIS REJOINDER HAD SUBM ITTED BEFORE THE CIT(A) WHICH IS EXTRACTED FROM THE IMPUGNED ORDER O F THE CIT(A): (ON PAGE 9) 2.I HAD ALREADY GIVEN CAS H OF RS.5 LAKHS IN THE EARLIER YEAR ENDED ON 31.3.2004 . ON A PERUSAL OF THE ASSESSEES WRITTEN SUBMISSION O N REMAND REPORT OF THE ITO [PAGES 16 21 OF PB], WE COULD NOT FIND ANY ME NTION OF SUCH A CLAIM. EVEN AT THE TIME OF HEARING ALSO, NO DOCUMENTARY EV IDENCE HAS BEEN PLACED FOR OUR PERUSAL TO VOUCH SUCH A CLAIM. IN VIEW OF THE ABOVE, WE ARE OF THE UNANIMOUS VIEW THAT THIS ISSUE SHOULD BE REM ITTED BACK ON THE FILE OF THE AO WITH A SPECIFIC DIRECTION TO LOOK INTO THE C LAIM OF THE ASSESSEE WITH REFERENCE TO THE DOCUMENTARY EVIDENCE SUCH AS PASS SHEET OF THE BANK, LEDGER ACCOUNT ETC., WHICH WILL BE FURNISHED BY THE ASSESSEE AND TO TAKE APPROPRIATE ACTION IN ACCORDANCE WITH LAW AFTER AFF ORDING A REASONABLE OPPORTUNITY TO THE ASSESSEE OF BEING HEARD. IN THE MEANWHILE, THE ASSESSEE, THROUGH HIS A R, IS ADVISED TO FURNISH TH E PROOF BY WAY OF ITA NO.522 & 579 /BANG/ PAGE 10 OF 12 DOCUMENTARY EVIDENCE AT HIS POSSESSION TO THE AO FO R HIS/HER VERIFICATION. IT IS ORDERED ACCORDINGLY. IV. AGRICULTURAL INCOME: RS. 1 LAKH: 10. THE GROUSE OF THE ASSESSEE IS THAT THE CIT(A) E RRED IN CONCLUDING THAT THE ASSESSEES AGRICULTURAL INCOME FROM 22 ACR ES OF LAND WOULD BE ONLY RS.50000 AS AGAINST RS.1 LAKH CLAIMED. 10.1 AT THE OUTSET, WE WOULD LIKE TO POINT OUT T HAT THE ASSESSMENT IN QUESTION WAS CONCLUDED U/S 144 OF THE ACT IN THE AB SENCE OF ANY COMPLIANCE AND, THUS, THE AO TREATED THE ENTIRE AGR ICULTURAL INCOME CLAIMED BY THE ASSESSEE AS UNEXPLAINED CASH CREDITS. HOWEV ER, THE CIT (A) WAS MAGNANIMOUS IN HIS VIEW AND ADMITTED THE INCOME FRO M AGRICULTURE AT RS.50000/-, EVEN THOUGH NO DOCUMENTARY EVIDENCE WAS ADVANCED. 10.2 WE HAVE PERUSED THE EARLIER ASSESSMENT ORD ERS OF THE ASSESSEE PLACED IN THE PAPER BOOK. FOR THE AY 2003-04, THE ASSESSEE HAD A CLAIM OF RS.5 LAKHS WHICH WAS SLASHED TO RS. 3.67 LAKHS I N THE ASSESSMENT. FOR THE AY 2004-05, THE ASSESSEE HIMSELF HAD CLAIMED AN INCOME OF RS.1 LAKH ONLY. FOR THE AY 2006-07 THE ASSESSEE HAD RETURNED THE AGRL. INCOME AT RS.60000/- WHICH WAS GRACED BY THE AO. NO DOUBT, T HE ASSESSEE HAS OWNED AROUND 18 ACRES AND THE MAIN CROPS BEING BANA NAS, POTATO, GREEN VEGETABLES ETC. WHICH ARE SHORT TERM AND SEASONED P RODUCES. FROM THE ASSESSEES OWN ESTIMATION, THE YIELD FROM SUCH PROD UCES ARE RATHER IN DESCENDING ORDER OF RS.5 LAKH, RS.1 LAKH, RS.60,000 /- . WE ARE OF THE CONSIDERED VIEW THAT THE CIT (A) WAS FULLY JUSTIFIE D IN ARRIVING AT A FIGURE OF ITA NO.522 & 579 /BANG/ PAGE 11 OF 12 RS.50000/- WHICH REQUIRES NO INTERFERENCE AT THIS S TAGE. IT IS ORDERED ACCORDINGLY. ITA NO: 579/09 U/S 154 OF THE ACT : 11. IN THIS APPEAL, THE ASSESSEE HAS RAISED TW IN ISSUES, NAMELY: (I) THE AO ERRED IN CONCLUDING THAT THE ORDER PASSED U/ S 154 OF THE ACT BY INCREASING THE INCOME BY RS.22 LAKHS AS A VA LID ORDER WHICH IS CONTRARY TO THE EVIDENCE ADDUCED; & (II) THE CIT(A) ERRED IN HOLDING RS.5 LAKHS WAS THE UNEX PLAINED INVESTMENT IN THE PURCHASE OF A HOUSE FOR 85 LAKHS. 11.1 WITH REGARD TO THE FIRST ISSUE, THE CIT( A) HAD OBSERVED THAT THE ISSUE HAD BEEN DECIDED WHILE DISPOSING OF THE APPEA L AGAINST THE ORDER PASSED U/S 144 OF THE ACT. 11.2 THE AO IN PAGE 7 OF HER REMAND REPORT [ON PAGE 13 OF PB] HAD SUBMITTED THAT ON PERUSAL OF THE SALE DOCUMENT IT IS SEEN THAT TH E AMOUNT OF RS.20,00,000/- HAS BEEN PAID TO THE VENDOR DURING THE FINANCIAL YE AR 2003-04 FOR THE PURCHASE OF PROPERTY NO.917, 9 TH CROSS ROAD, 2 ND PHASE, J.P.NAGAR, WARD NO.57, BANGALORE WHICH WAS REGISTERED ON 24.5.04 IN THE NAMES OF THE ASSESSEE A.N.KUMAR RAJ AND HIS WIFE SMT.PADMA KUMA R RAJU JOINTLY. THE SALE DEED STATES THAT AN AMOUNT OF RS.15,00000/ - HAS BEEN PAID BY WAY OF CHEQUE NO.258721 DT:31.10.03 AND RS.5,00,000/- V IDE CHEQUE NO.258722 DATED 30.10.03 DRAWN ON UNION BANK OF INDIA. THE CONCERNED BANK ACCOUNTS HAVE BEEN VERIFIED AND IT IS FOUND THAT TH E SAME HAS BEEN PAID IN THE PREVIOUS YEAR AND HENCE THE SAME MAY BE CONSIDERED. IN VIEW OF THE ABOVE, THE ADDITION OF RS.22 LAKHS I NCLUDED IN THE ORDER PASSED U/S 154 OF THE ACT STANDS DELETED. 11.3 IN RESPECT OF RS.5 LAKHS BEING UNEXPLAINED I NVESTMENT IN THE PURCHASE OF A HOUSE FOR 85 LAKHS, WE CONFIRM OUR FI NDING IN THE FOREGOING ITA NO.522 & 579 /BANG/ PAGE 12 OF 12 PARAGRAPH [PARAGRAPH NO.7.III] WHICH HOLDS GOOD. IT IS ORDERED ACCORDINGLY. 12. IN THE RESULT, THE ASSESSEES APPEALS ARE PARTLY ALLOWED . PRONOUNCED IN THE OPEN COURT ON THIS 30 TH DAY OF DECEMBER, 2009. SD/- SD/- ( K.P.T. THANGAL ) (A. MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 30 TH DECEMBER, 2009. DS/- COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE (1+1) BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE.