SHRI JAGDEV SINGH,SIRSA vs. ITO WARD-3, SIRSA

It emerges that the assessee declared income of Rs.3.01 Lacs and agricultural income of Rs.2.72 Lacs. It transpired that the assessee deposited cash in its two bank accounts which were stated to be sourced out of earlier withdrawals, sale of agricultural produce and sale of agricultural land. Another advance of Rs.29.20 Lacs was stated to be received from Shri Maninder Singh as advance for sale of agricultural land. The same was confirmed by Shri Maninder Singh but still, Ld. AO added an amount of Rs.29.20 Lacs to the income of the assessee.

The Ld. CIT(A), after having considered assessee’s submissions, did not admit the appeal on delay. On merits also, it was observed that Shri Maninder Singh was having dairy income and agricultural income though he was not filing tax return. The payment was stated to be made out of agricultural income. However, the sale deed was not registered. On these facts, Ld. CIT(A) confirmed the assessment against which the assessee is in further appeal before us.

From the facts, it emerges that the assessee is an agriculturist and it earns agricultural income which has also been accepted by Ld. AO. The assessee is having sufficient landholding for which he has entered into agreement for sale with Sh. Maninder Singh and received advance of Rs.29.20 Lacs. The same has duly been confirmed by Sh. Maninder Singh. The advances have exchanged in cash as confirmed by the payer. The payer is also an agriculturist. In our considered opinion, the mere fact that the sale deed was not registered subsequently cannot vitiate the claim of the assessee since the assessee has duly discharged the onus of establishing the fact that the sum of Rs.29.20 Lacs was received as advance under an agreement to sell which is not in doubt. On these facts, we would hold that the impugned addition is not sustainable. We order so. 5. The appeal stand allowed. Order pronounced on 01-04-2025.