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Facts
The assessee, an individual, filed a return of income showing business income and a significant amount as agricultural income. The case was selected for limited scrutiny. The assessee claimed the agricultural income was wrongly included due to a copy-paste mistake by the tax consultant's junior accountant, stating they owned no agricultural land.
Held
The Tribunal, considering the totality of facts and in the interest of justice, decided to set aside the order of the CIT(A)/NFAC and remand the matter back to the Assessing Officer. The AO is directed to pass a fresh assessment order after providing a reasonable opportunity of hearing to the assessee.
Key Issues
Whether the agricultural income claimed by the assessee was genuinely earned or a result of a clerical error by the tax consultant, and if the additions made by the AO are justified.
Sections Cited
44AD, 143(2), 142(1), 144B, 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE
Before: SHRI MANISH BORAD & SHRI VINAY BHAMORE
Assessment Year : 2020-21 Sachin Bhagwanrao Joshi, Vs. ITO, Ward-1, Parbhani. At Post Chatori, Tq. Palam, Palam- 431506. PAN : AILPJ7265R Appellant Respondent Assessee by : Shri Bashiruddin Shaikh Revenue by : Shri Harshit Bari Date of hearing : 21.08.2025 Date of pronouncement : 30.10.2025 आदेश / ORDER
PER VINAY BHAMORE, JM:
This appeal filed by the assessee is directed against the order dated 25.10.2024 passed by Ld. CIT(A)/NFAC for the assessment year 2020-21.
Facts of the case, in brief, are that the assessee is an individual and had filed his return of income u/s 44AD on 31.03.2021 at an income of Rs.2,98,905/-. Assessee has also shown agricultural income of Rs.38,26,580/-. The case was selected for limited scrutiny to examine the issue of agricultural income shown by the assessee. Statutory notices u/s 143(2), 142(1) and show cause notice were issued to the assessee. In compliance to the above notices, the assessee submitted that the assessee is running a public service centre/Maha E Seva Kendra and also engaged in retail sales of other products. It was also replied by the assessee that he is neither in possession of any agricultural land nor having any agricultural income. Due to the copy paste mistake of the tax consultant office clerk/accountant, an amount of Rs.38,26,580/- was shown as agricultural income. Being unsatisfied with the reply of the assessee, the Assessing Officer completed the assessment u/s 143(3) r.w.s. 144B of the Act by determining total income of Rs.41,25,485/- as against the income returned by the assessee at Rs.2,98,905/-. The above assessed income includes addition of Rs.38,26,580/- as income from other sources.
Being aggrieved with the above assessment order, an appeal was filed before Ld. CIT(A)/NFAC. After considering the reply of the assessee, Ld. CIT(A)/NFAC dismissed the appeal filed by the assessee.
It is the above order against which the assessee is in appeal before this Tribunal.
5. Ld. AR appearing from side of the assessee submitted before us that the order passed by Ld. CIT(A)/NFAC is unjustified. Ld. AR further submitted that the assessee is only running a public service centre/ Maha E Seva Kendra and also engaged in retail sales of other products and income is disclosed as per the provisions of section 44AD of the Act. Regarding disclosure of agricultural income in the return of income, it was submitted by Ld. AR that due to inadvertent mistake of the junior/accountant of the tax consultant such an income was disclosed. Ld. AR further submitted that the assessee never owned any agricultural land and never possessed any agricultural land, therefore, question of having any agricultural income does not arise. Ld. AR also submitted that even in the bank accounts of the assessee no deposit was made. In support of all these contentions, Ld. AR produced an affidavit dated 24.05.2025 duly sworn in by the assessee wherein it is stated that the assessee do not own any agricultural land and the agricultural income in the return was disclosed by the staff of the tax consultant. Apart from above affidavit, another affidavit dated 21.05.2025 sworn in by junior of the tax consultant is also produced wherein it was accepted by him that due to his mistake the above impugned agricultural Rs.38,26,580/- and 40 acres of agricultural land was disclosed in the return. Accordingly, Ld. AR requested before the Bench to delete the addition of Rs.38,26,580/- as confirmed by Ld. CIT(A)/NFAC.
Ld. DR appearing from side of the Revenue relied on the orders passed by the subordinate authorities and requested to confirm the same.
We have heard Ld. Counsels from both the sides and perused the material available on record including the paper book furnished by the assessee as well as affidavits of the assessee and the junior of the tax consultant. In this regard, we find that the return of income was e-filed by the assessee. We also find that in subsequent assessment year i.e. in A.Y. 2021-22 also, an agricultural income of Rs.39,85,040/- was disclosed in the original return of income, however when scrutiny notice u/s 143(2) for assessment year 2020-21 was received the assessee revised the return of income for assessment year 2021-22 and agricultural income of Rs.Nil was disclosed. We also find that neither Assessing Officer nor Ld. CIT(A)/NFAC gave a finding that such an amount was deposited in the bank account of the assessee for the period under consideration or for subsequent period. Admittedly, no taxpayer should be taxed on an income which does not exist, however it is the duty of the assessee to prove it, since in the instant case assessee himself disclosed such an income.
In support of contention that due to the mistake of the junior of the tax consultant such agricultural income was disclosed two affidavits are produced before the bench respectively sworn in by the assessee as well as by junior of the tax consultant. Since both these affidavits were neither produced either before the Assessing Officer or before Ld. CIT(A)/NFAC, therefore falls in the category of additional evidences. We accept the request of Ld. AR to consider both the affidavits as an additional evidence.
Considering the totality of the facts of the case & in the interest of justice and without going into merits of the case, we deem it appropriate to set-aside the order passed by Ld. CIT(A)/NFAC & remand the matter back to the file of the Assessing Officer to pass assessment order afresh i.e. de novo after providing reasonable opportunity of hearing to the assessee. The assessee is also hereby directed to respond to the notices issued by the Assessing Officer in this regard and to produce relevant