K PRATAP REDDY ,HYDERABAD vs. INCOME TAX OFFICER, WARD-1, SURYAPET

The assessee’s first and foremost substantive grievance in the instant appeal seeks to reverse both the lower authorities’ action disallowing his agricultural income claim of Rs.6,25,000/- to the extent of Rs.3,75,000/-; thereby granting part relief of Rs.5,000/- per acre only. It is not in dispute that this assessee owns more than 50 acres of land; although stated to be in dry area. The fact also remains that possibility of agricultural income per se cannot be ruled out and more so when both the lower authorities have themselves accepted the same @5,000/- per acre. I deem it appropriate in these facts and circumstances that the assessee deserves to be granted a relief of Rs.5,000/- per acre over and above Rs.2.5 lakhs accepted in the course of assessment with a rider that the same shall not be treated as a precedent. The assessee gets further relief of Rs.2.50 lakhs in all and the remaining disallowance/addition component of Rs.1,25,000/- only is sustained. This ground is taken as partly accepted in foregoing terms.

Next comes interest income addition of Rs.12,96,750/-. Learned departmental representative stated very fairly that there has been an agreement executed amongst the assessee and the alleged buyers Shri K.Bhaskar Rao and Shri T.V.G.Sudershan which has not been adequately examined in the CIT(A)’s order. I therefore deem it appropriate to restore the latter back to the Assessing Officer for afresh factual verification as well as in light of the corresponding development in AY.2011-12 as per law.

This assessee’s appeal is treated as partly allowed in above terms.