HARDEEP SINGH KANDOLA,RATIA vs. ITO, FATEHABAD
1
IN THE INCOME TAX APPELLATE TRIBUNAL
“A” BENCH, CHANDIGARH
PHYSICAL HEARING
BEFORE HON’BLE SHRI RAJPAL YADAV, VICE PRESIDENT
AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
आयकर अपील सं. / ITA No.455/CHANDI/2025 (िनधाŊरणवषŊ / Assessment Year: 2011-12) & 2. आयकर अपील सं. / ITA No.456/CHANDI/2025 (िनधाŊरणवषŊ / Assessment Year: 2011-12) Shri Hardeep Singh Kandola Village Lamba Post Office Chimo Haryana 1250 051 बनाम/ Vs. ITO-Ward -1 Aaykar Bhawan, Sirsa Road Fatehabad (Haryana) 125 050 ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. ATNPK-2170-M (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent)
अपीलाथŎकीओरसे/ Appellant by :
Shri Ankit Kumar (Advocate) a/w Shri Lalit
Mohan (CA) – Ld. ARs
ŮȑथŎकीओरसे/Respondent by :
Shri Manav Bansal (CIT) a/w Shri Vivek
Vardhan (Addl. CIT) – Ld. DRs
सुनवाईकीतारीख/Date of Hearing
:
19-08-2025
घोषणाकीतारीख /Date of Pronouncement
:
02-09-2025
आदेश / O R D E R
Manoj Kumar Aggarwal (Accountant Member)
In these appeals for Assessment Year (AY) 2011-12, the assessee assails validity of revisionary juri iction u/s 263 as well as quantum addition made in consequential assessment as framed by Ld. AO. First, we take up quantum appeal ITA No.455/Chandi/2025 which 2
arises out of an order of learned Commissioner of Income Tax
(Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)]
dated 24-01-2025 in the matter of an assessment framed by Ld.
Assessing Officer [AO] u/s. 144 r.w.s. 263 of the Act on 15-03-2022. The said assessment has been framed consequent to revisionary order passed by Ld. Pr. Commissioner of Income Tax, Rohtak (Pr. CIT) u/s 263 on 12-03-2021. Having heard rival submissions and upon perusal of case records, the appeal is disposed-off as under.
2. The assessee was subjected to reassessment proceedings and an order was passed by Ld. AO u/s 143(3) r.w.s. 147 of the Act on 08-
11-2018. The case was reopened to examine the sources of cash deposits of Rs.56.62 Lacs as deposited by the assessee in his savings bank account. After examining assessee’s submissions and return of income, Ld. AO noted that the assessee was an agriculturist and part of the cash was deposited out of sale of agricultural land for Rs.18.50
Lacs. The assessee furnished all the evidences. Accordingly, returned income of Rs.1.35 Lacs with agricultural income of Rs.26.83 Lacs was accepted by Ld. AO.
3. The assessment was subjected to revision u/s 263 by Ld. Pr. CIT on 12-03-2021 on the ground that the assessee did not furnish copies of J-Form and copy of account with Arhtiya to support sale proceeds of agricultural proceeds. The assessee reflected income of 85% of gross receipts which was not logical. The Ld. AO failed to verify the same.
Accordingly, Ld. AO was directed to redo the assessment
In the consequential assessment order dated 15-03-2022, the assessee furnished various documents which were rejected by Ld. AO and finally the addition of Rs.26.50 Lacs was made to the income of the assessee. The Ld. CIT(A) confirmed the same against which the assessee is in further appeal before us. 5. From the case records, it emerges that the case of the assessee was specifically reopened to examine the sources of cash deposit. During regular assessment proceedings, the assessee furnished various documents in support of the same. After due consideration thereof, Ld. AO accepted the sources of cash deposits and framed the assessment. The Ld. Pr. CIT, while revising the assessment, has noted that the assessee and his father owned 50.11 acres of land. The agricultural land was sold on 25-05-2020 for Rs.18.50 Lacs which was purchased on 04-05-2010 for Rs.18.40 Lacs and therefore, there was no cash generation since sale consideration as well as purchase consideration was almost identical. The assessee is stated to have received sale proceeds of Rs.30,000/- per acre from cultivation of wheat and Rs.33,000/- per acre form cultivation of paddy. The assessee received sale proceeds of Rs.31.50 Lacs and reflected agricultural income of Rs.26.83 Lacs which was rejected on the ground that an agriculturist has to spend around 60% of the sale proceeds on various agricultural operation expenses. Further, the assessee did not file J-Form and the cash was deposited within short period of time. 6. Upon due consideration of material facts, we find that land holding of the assessee has not been disputed by lower authorities. The fact of 4
earning of agricultural income is also not in dispute. The observation that an agriculturist has to spend around 60% of the sale proceeds on various agricultural operation expenses is a general observation which does not discredit the claim of the assessee of earning of agricultural income. Another observation is that the agricultural land was sold on 25-05-2020 for Rs.18.50 Lacs which was purchased on 04-05-2010 for Rs.18.40 Lacs and therefore, there was no cash generation since sale consideration as well as purchase consideration was almost identical.
The said conclusion is fallacious observation since the source of purchase of property on 04-05-2010 was neither disputed not subject matter of impugned assessment year. The fact remains that the assessee sold the land in this year for Rs.18.50 Lacs and the sale proceeds were part source of impugned deposits in the bank and therefore, the sources, to that extent stood clearly explained by the assessee. On these facts, the impugned addition of Rs.26.50 Lacs could not be sustained in law. We order so. The assessee succeeds in this appeal. Consequently, the challenge to revisionary proceedings u/s 263, which is subject matter of ITA No.456/Chandi/2025, has been rendered infructuous and need not be gone into.
7. ITA No.455/Chandi/2025 stand allowed. ITA No.456/Chandi/2025
stands dismissed as infructuous.
Order pronounced on 02-09-2025. (RAJPAL YADAV) (MANOJ KUMAR AGGARWAL)
VICE PRESIDENT ACCOUNTANT MEMBER
Dated: 02-09-2025
आदेश की Ůितिलिप अŤेिषत /Copy of the Order forwarded to :
1. अपीलाथŎ/Appellant
2. ŮȑथŎ/Respondent
3. आयकरआयुƅ/CIT
4. िवभागीयŮितिनिध/DR
5. गाडŊफाईल/GF