SHRI VISHNU MURLIDHAR PAWAR,,BURHANPUR vs. INCOME TAX OFFICER, BURHANPUR

PER MANISH BORAD, AM.

This appeal of Assessee pertaining to A.Y. 2008-09 is directed

against the order of Ld. Commissioner of Income Tax(Appeals)-

II, Indore (in short ‘CIT(A)’), dated 01.05.2017 which is arising

out of the order u/s 143(3) of the Income Tax Act

1961(hereinafter called as the ‘Act’) framed on 02.12.2010 by

ITO, Burhanpur.

Vishnu Murlidhar Pawar ITA No.564/Ind/2017 2. The assessee has raised following grounds;

“1. The Ld.CIT(A) has erred in upholding the income of Rs.5,20,830/- on account of alleged income from money lending. 2. It was proved before the Ld. Authorities that the assessee had provided the financial assistance for very short period to the small agriculturalist for regularizing the KCC accounts and no interest was earned by the assessee. All the agriculturalist have confirmed the same by the affidavit and the statements given before the Ld.A.O. 3. The addition made by the Ld.A.O may please be deleted. 4. The assessee prays to alter, amend, add or delete ant of the grounds of appeal”

that assessee is an individual having only source of income

from agriculture. The income tax return filed on 18.06.09.

Agriculture income of Rs.8,00,000/- was disclosed. Case

picked up for scrutiny on the basis of AIR information. Notice

u/s 143(2)of the Act was served upon the assessee. Necessary

details as called for were submitted. Ld.A.O on perusal of the

saving bank account held by the assessee with Bank of India,

Khaknar noticed that during the financial year under appeal

cash of Rs.53,89,500/- was deposited on various dates. There

were regular withdrawals also. It was contended by the

Vishnu Murlidhar Pawar ITA No.564/Ind/2017 assessee that interest free the alleged cash deposits are having

their source from agriculture income and accumulated income

of preceding years. It was also contended that loans were

given to friends and relatives for short period in order to help

them in their agriculture operations. Ld.A.O however took the

view that the assessee is engaged in money lending business

besides earning agriculture income. On the basis of bank

account and cash deposited at various dates, Ld.A.O

calculated a peak debit balance of Rs.4,65,024/- treating it as

undisclosed investment in money lending business. Ld.A.O

also calculated interest income of Rs.55,803/- on the alleged

unaccounted investment and made addition of Rs.5,20,827/-

to NIL income shown by the assessee. In the result

agriculture income assessed at Rs.8,00,000/- and total

income other than agriculture income at Rs.5,20,830/-.

Aggrieved assessee preferred appeal before Ld.CIT(A) but failed

to succeed as the view taken by the Ld.A.O was confirmed by

the Ld.CIT(A).

Vishnu Murlidhar Pawar ITA No.564/Ind/2017 5. At the outset Ld. Counsel for the assessee reiterated the

submissions made before the lower authorities and submitted

that there was sufficient source of cash deposited on various

dates at bank account and no addition was called for

unaccounted investment and he also submitted that no

interest income was earned.

argued and supported the orders of lower authorities and also

pointed out the details filed by the assessee at Page 1(e) to 1(i)

of the paper book providing complete person wise details of

amounts given and received back during the year.

placed before us. The assessee being the agriculturalist is

regularly earning income from agriculture. During the year

agriculture income of Rs.8,00,000/- has been assessed by the

Assessing Officer. There were regular transactions of cash

deposits and withdrawals as well as amounts given to various

persons for short period. Ld.A.O calculated undisclosed

investment amount of Rs.4,65,024/-. Apart from adding it to

Vishnu Murlidhar Pawar ITA No.564/Ind/2017 the income to the income of the assessee Ld. A.O also made

the addition for interest income of Rs.55,803/-.

opening balance of Rs.2,28,946/-. Assessee has declared

agriculture income of Rs.8,00,000/- during the year. It is also

not disputed that the assessee has been regularly earning

income from agriculture in the past. There is no material

available with the Revenue authorities to prove that the

assessee received cash from unexplained sources other than

agriculture income. However it is true that the assessee has

given short term advances to various persons and there are

around 19 persons to whom the assessee has paid the amount

on credit for short period not exceeding 12 months.

are of the considered view that as far as the addition on

unaccounted investment is concerned the assessee had

sufficient accumulated funds, opening bank balance as well as

income earned during the year which could justify the source

of the cash deposited on various dates and also to explain the

Vishnu Murlidhar Pawar ITA No.564/Ind/2017 source of alleged unaccounted investment of Rs.4,65,024/-

and in our view the same needs to be deleted. As regards the

interest income addition is concerned, we do not find any

reason to interfere in the findings of the lower authorities as

no plausible reasons have been given by the Ld. Counsel for

the assessee for giving such short term advances which are

ranging from 1 month to 6 month without changing any

interest and therefore the addition for alleged interest income

of Rs.55,083/- needs to be confirmed.

assesssee is partly allowed and Ground No.3 & 4 are general

in nature which needs no adjudication.

The order pronounced in the open Court on 17.10.2018.

Sd/- Sd/-

( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER �दनांक /Dated : 17 October, 2018 /Dev

Vishnu Murlidhar Pawar ITA No.564/Ind/2017 Copy to: The Appellant/Respondent/CIT concerned/CIT(A) concerned/ DR, ITAT, Indore/Guard file. By order Asstt.Registrar,I.T.A.T., Indore