JIVRAJBHAI DHANJIBHAI PATEL,GANDHINAGAR vs. THE ITO, WARD-1, MEHSANA

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ITA 2611/AHD/2025Status: DisposedITAT Ahmedabad22 May 2026AY 2017-186 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal due to the assessee's circumstances. It held that the CIT(A) erred in estimating agricultural income without proper basis and that the assessee had sufficiently demonstrated agricultural activity and income.

What were the facts?

The assessee, an illiterate farmer, filed an appeal late due to his consultant not informing him of the CIT(A) order. The CIT(A) had partly confirmed the addition of agricultural income, treating a portion as income from other sources.

What were the issues?

Whether the delay in filing the appeal should be condoned, and whether the CIT(A) was justified in estimating agricultural income and treating a portion as income from other sources.

Which sections of the Income-tax Act were involved?

Section 250,Section 270A,Section 10(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD

Before: SMT. ANNAPURNA GUPTA & SHRI SIDDHARTHA NAUTIYAL

For Appellant: Shri Chirag Raval, AR, Shri Girish Parihar, Sr.DR
For Respondent: Shri Girish Parihar, Sr.DR
Hearing: 23/03/2026Pronounced: 22/05/2026

PER ANNAPURNA GUPTA, AM:

The present appeal has been filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals), ADDL/JCIT(A)-9, Mumbai (hereinafter referred to as “CIT(A)”) dated 28.10.2024 passed under Section 250 of the Income Tax Act,

ITA No.2611/Ahd/2025 [Jivrajbhai Dhanjibhai Patel vs. ITO] A.Y. 2017-18 - 2 – 1961 (hereinafter referred to as the “Act”) and relates to Assessment Year (A.Y.) 2017-18.

2.

The appeal is delayed for filing by 360 days before us. The assesse has filed an application seeking condonation of the delay. The reasons for the delay are stated on oath in the form of duly notarized affidavit contending that the delay occurred on account of the fact that he was a farmer, illiterate person, doing agricultural activity, not having any knowledge of Income Tax Law, appellate procedures or statutory limitation that he had engaged a Consultant to handle his appellate matter who did not inform him about passing of the CIT(A) order. That he became aware of the same only on receipt of the penalty notice u/s.270A of the Act dated 19.12.2025 and, therefore, immediately thereafter he filed appeal before us on 26.12.2025 resulting in a delay of 360 days. He further contended that if the appeal is not entertained, it would cause grave injustice, since, it would result in assessment of his taxable income at Rs.11,47,379/- as opposed to Nil taxable income returned by him, which would be grossly unjustified and would have serious financial repercussion on him, a poor illiterate farmer. The Ld. DR opposed the condonation of delay.

3.

Considering the averments of the assessee as above and noting the fact that the assessee is a farmer and illiterate person doing agricultural activity, we find that the assessee has adduced reasonable cause for the delay in the filing of the present appeal

ITA No.2611/Ahd/2025 [Jivrajbhai Dhanjibhai Patel vs. ITO] A.Y. 2017-18 - 3 –

before us on account of being not informed about the passing of the appellate order by his Tax Consultant. Even otherwise, we agree with the assessee that not entertaining the assessee’s appeal on account of technicalities of non-condonation of delay would result in the assessee being liable to pay taxes on income of Rs.11.47 Lakhs that too without being heard. In the interest of justice, therefore, and noting the assessee to have adduced sufficient cause for the delay, we condone the delay of 360 days in the filing of the present appeal before us.

4.

Taking up the appeal for adjudication, the grounds raised by the assessee read as under:

“1. Erroneous and Unsustainable Disallowance of Agricultural Income of Rs.11,47,379/- by the learned CIT(Appeals): - On facts and in law, the learned Commissioner of Income Tax (Appeals) has erred in partly confirming the addition by treating a sum of Rs.11,47,379/- as "Income from Other Sources, despite accepting that the appellant was holding agricultural land and carrying out agricultural activities. The leamed CIT(A), >erred in law in resorting to estimation of agricultural income at a fixed rate per hectare, without any provision under the Income-tax Act, 1961 authorising such arbitrary estimation, and without bringing any cogent material on record to justify the same. failed to appreciate that agricultural income is exempt under section 10(1) of the Income-tax Act, 1961, and once the agricultural activity and landholding are accepted, the declared agricultural income cannot be partly re-characterised as income from other sources merely on estimation.

ITA No.2611/Ahd/2025 [Jivrajbhai Dhanjibhai Patel vs. ITO] A.Y. 2017-18 - 4 –

➤ erred in sustaining the addition without demonstrating that the balance amount represented income falling under the head "Income from Other Sources" or that it was derived from any non-agricultural source. ➤ erred in law and on facts in not granting complete relief, despite the assessment being framed on assumptions and inferences rather than on legally sustainable evidence. The impugned order is vitiated for want of proper appreciation of evidence, as the sale bills of agricultural produce and details of agricultural expenses were not rejected in entirety, nor was any adverse finding recorded to disprove the genuineness of agricultural operations. The action of the learned CIT(A) in sustaining the addition is arbitrary. excessive, and contrary to the principles of natural justice, and has resulted in serious prejudice to the appellant.”

5.

Briefly stated, the assessee had filed return of income disclosing exempt agricultural income amounting to Rs.20,49,379/-, which claim of the assessee was denied by the AO and the entire income treated as taxable under the head ‘income from other sources’ on account of the assessee having allegedly failed to have discharged his onus of substantiating his claim of having earned agricultural income to the said extent.

6.

Ld. CIT(A), however, appreciated all the evidences filed by the assessee and held that the assessee did earn agricultural income, but, he resorted to estimation of the agricultural income on the basis of the agricultural land holding of the assessee estimating it as Rs.2Lakhs per hectare of the land held and since the assessee was found to hold 4.51 hectares of land, he estimated the agricultural income earned by the assessee at Rs.9,02,000/-.

ITA No.2611/Ahd/2025 [Jivrajbhai Dhanjibhai Patel vs. ITO] A.Y. 2017-18 - 5 – The balance amount of Rs.11,47,379/- was treated as ‘income from other sources’.

7.

Aggrieved by the order of the Ld. CIT(A), the assessee has come up in appeal before us.

8.

We have heard both the parties and have gone through the order of the authorities below.

9.

The issue for adjudication is whether the Ld. CIT(A) has rightly held the agricultural income earned by the assessee to be Rs.9,02,000/- as opposed to Rs.20,49,379/- claimed by the assessee. The facts which are not disputed is that the assessee was found to be the owner of the agricultural land of 4.51 hectares. The assessee had produced sales bills of Rs.26,77,685/- of agricultural produce and had produced bills of purchase of seeds, fertilizers etc. amounting in all to Rs.13,44,766/-. The above facts are noted in the order of the Ld. CIT(A) itself. The above facts categorically demonstrate that the assessee was an agriculturist and had earned agricultural income. Even the Ld. CIT(A) accepts this fact. The only issue is with regard to the quantum of agricultural income earned by the assessee. The Ld. CIT(A) has resorted to assumption by applying a rate of Rs.2Lakhs of agricultural land of 4.51 hectares. Clearly, there is no basis that the Ld. CIT(A) for applying the said rate. We fail to understand how, therefore, the estimation was justified. Considering that the

ITA No.2611/Ahd/2025 [Jivrajbhai Dhanjibhai Patel vs. ITO] A.Y. 2017-18 - 6 –

assessee had demonstrated the fact of being an agriculturist and having earned agricultural income, I find no reason to reject the assessee’s claim of having earned agricultural income of Rs.20,49,379/-. The addition confirmed by the Ld.CIT(A) of Rs.11,47,379/- is, accordingly, deleted.

10.

In the result, appeal filed by the assessee is allowed.

This Order pronounced on 22/05/2026

Sd/- Sd/- (SIDDHARTHA NAUTIYAL) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated 22/05/2026 S. K. SINHA True Copy आदेश क� �ितिल�प अ�े�षत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. ��यथ� / The Respondent. 2. संबंिधत आयकर आयु� / Concerned CIT 3. आयकर आयु�(अपील) / The CIT(A)- 4. 5. �वभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad गाड� फाईल / Guard file. 6. आदेशानुसार/ BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad

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