K. S. RAGHUPATYHY,CHENNAI vs. ITO, WARD-1(1), ERODE

The assessee is an individual and the return of income for AY 2020-21 on 15.02.2021 declaring Nil income. The income of the assessee includes income from agriculture activities amounting to Rs. 35,15,310/- and loss from

The AO after perusing the details furnished by the assessee, sent notices u/s. 133(6) to three parties out of the 16 parties to whom the assessee has sold agriculture produces as per the details furnished by the assessee. Since the parties did not respond, the AO held that the gross agriculture receipts declared by the assessee are on the higher side. The AO therefore proceeded to made addition to the tune of Rs.13,31,756/- by re-computing the agriculture income. The relevant findings of the AO in this regard are extracted herein below: 6. From the above discussion and facts of the case, it is established that the assessee performed agricultural activities and earned agricultural income but shown his agricultural receipts amount purely on estimate basis except the receipts in respect of sale of sugarcane. In such event, the assessee should have estimated his agricultural receipts on the basis of prevailing market rate. The assessee shown his receipts of Rs. 25,00,000/- from 750 coconut trees. The production/yield of coconut tree is minimum 70 coconut and maximum 100 coconuts per tree per year and prevailing rate is between Rs. 20/- to 25/- per coconut. If in the case of the assessee, production of coconut is taken at 90 coconut per tree and rate is taken Rs. 25/-(which is maximum) per coconut, then total amount of sale of coconut from 750 tress comes to Rs. 16,87,500/- against Rs. 25,00,000/- shown by the assessee. When vide notice dated 05.09.2022, the assessee asked to furnish his justification in this regard, he has no explanation in this regard. As such, it is proved that the assessee shown his receipts from sale of coconut excess by an amount of Rs. 8,12,500/-, which 32.5% of receipts

Aggrieved, the assessee filed further appeal before the CIT(A), who confirmed the addition made by the AO. The assessee is in appeal before the Tribunal against the order of the CIT(A).

The Ld. Authorized Representative (AR) of the assessee submitted that the only ground for making the addition by the AO is that three of the parties to whom the A.O has issued Section 133(6) notice have not responded. The Ld. AR further submitted that the lower authorities have not considered the evidence submitted in the form of certificate from Village Administrative Officer certifying the yield in assessee's land for the reason that the certification only indicates the cultivation and does not substantiate that the quantity cultivated is sold. The Ld. AR also submitted that the basis on which the AO has made the addition is based on information available in the internet and not based on any proper documentation confirming that the yield declared by the assessee is in excess. The Ld. AR in this regard submitted a document published by the National Agriculture Development Programme where the yield of coconut for the year under consideration is declared to be 138 coconuts per tree per annum (page 39 of paper book). The Ld. AR further submitted that the report is available in the public domain and is an authentic

The Ld. Departmental Representative (DR), on the other hand, relied on the orders of the lower authorities.

We have heard the parties, and perused the material available on record. The assessee during the course of hearing has submitted a detailed breakup of the agriculture receipts from sale of various produce. The assessee also furnished the party wise break up along with PAN to whom the assessee has sold the produce. The A.O sent 133(6) notices to the parties and since no reply was received held that there is agriculture receipts declared by the assessee are not substantiated. Accordingly, the AO proceeded to re-compute the agriculture income whereby he reduced the agriculture receipts declared by the assessee and treated the difference as unexplained money u/s. 69A of the Act. From the perusal of the finding of the AO, we notice that the AO has assumed the yield of coconut per tree per annum as between 70 to 100 coconuts and has considered 90 coconuts per tree per annum as the yield which the assessee has actually earned. However, the A.O while doing so has not brought any material on record based on which the above yield was arrived at by the A.O. We further notice that the AO also proceeded to assume the excess amount of agriculture receipts with respect to other produces also based on the yield assumed for coconut. From the findings as recorded in the earlier part of this order, it is noticed that the entire process of re-computing the agriculture income/yield is based on the assumed number which is not substantiated by any evidence brought on record by the lower authorities. Before us, the Ld. AR drew our attention to the report from National Agriculture Development Programme which is reflecting a higher yield of

In the result, the appeal of the assessee is allowed.