DEVENDRA ULFATSINGH YADAV,,NASHIK vs. INCOME-TAX OFFICER,, NASHIK

आदेश / ORDER

PER VIKAS AWASTHY, JM

This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeal)-1, Nashik dated 20.03.2017 for the assessment year 2009-10.

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indicates that the notice has been duly served on the assessee/appellant.

Despite service of notice, neither the assessee nor any Authorized

Representative of assessee has put an appearance. No letter seeking

adjournment has been received from the assessee/appellant either. It appears

that the assessee is not keen to pursue the appeal. Therefore, we are

proceeding to decide the appeal with the assistance of ld. DR and material

available on record.

is engaged in agricultural activities. On the basis of AIR information in

respect of purchase of land comprising in S.No.221/4C, Nashik during the

period relevant to the assessment year under appeal, the Assessing Officer

issued notice u/s.148 of the Income Tax Act, 1961 (hereinafter referred to as

‘the Act’). In response to the said notice, the assessee filed return of income

on 16.04.2014 declaring total income as ‘Nil’ and agricultural income of

Rs.3,04,600/-. In assessment proceedings, the Assessing Officer made

addition on following counts:

Sr. Grounds of addition made by Amounts No. Assessing Officer. (in Rs.) i. Unexplained cheque deposited in Rs.20,42,500/- the bank account ii. Unexplained cash deposited Rs.5,00,000/- iii. Unexplained investment made in Rs.12,07,835/- land iv. Income from undisclosed sources Rs.2,13,220/- introduced in the form of agricultural income

143(3) r.w.s. 147 of the Act, the assessee filed appeal before Commissioner of

Income Tax (Appeal). The Commissioner of Income Tax(Appeal) vide impugned

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order rejected the contentions of assessee and dismissed the appeal. Now, the

assessee is in second appeal before the Tribunal assailing the findings of

Commissioner of Income Tax (Appeal) by raising following grounds:

“1. On the facts and in the circumstances of the case and in law the Lower Authorities have erred in making addition of Rs.20,42,500/- on account of unexplained cheque deposit on various dates by disregarding appellants contention and explanation offered, the entire addition may kindly be deleted. 2. On the facts and in the circumstances of the case and in law the learned Assessing Officer erred in making addition of Rs.5,00,000/- on account of unexplained cash deposited in bank account by disregarding appellant contention that the amount is received on account of agricultural income, the addition may kindly be deleted. 3. On the facts and in the circumstances of the case and in law the learned Assessing Officer erred in making addition of Rs.12,07,835/- on account of unexplained investment made in land by disregarding explanation offered by the assessee and not considering the documentary evidences brought on record, the addition may kindly be deleted.

assessee along with other persons had entered into an agreement for

purchase of land admeasuring 1H 8R comprising in S.No.221/4C at Nashik

for total consideration of Rs.67,77,000/-. The purchasers of the land had also

incurred expenditure on account of cost of Nazrana. The assessee’s share of

investment in the land is Rs.11,35,864/-and share in Nazrana is

Rs.14,73,717/-. Thus, the total investment of the assessee in land is

Rs.26,09,582/-. During the course of assessment proceedings, assessee was

asked to explain the source of investment in land. The assessee explained

that the investment in land has been made from agricultural income and

gifts. However, the assessee could not substantiate the alleged gifts received

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from various persons. The assessee failed to prove identity, credit-worthiness

of the persons and genuineness of the transactions. Further, the assessee

received cheques from various persons which were credited in his bank

account maintained with Saraswat Bank, Nashik. However, the assessee

could neither furnish the details on the persons issuing cheques nor any

confirmation letters from them. Even before the Commissioner of Income Tax

(Appeal), the assessee failed to furnish any documentary evidence to

substantiate his claim, hence, the appeal of assessee was dismissed. The ld.

DR prayed for upholding the findings of Commissioner of Income Tax (Appeal)

and dismissing the appeal of assessee.

orders of Authorities below. The assessee in appeal before us has assailed

four additions confirmed by the Commissioner of Income Tax(Appeal):

(i) Unexplained cheque deposited in the bank account Rs.20,42,500/-

(ii) Unexplained cash deposited Rs.5,00,000/-

(iii) Unexplained investment in land Rs.12,07,835/-

(iv) Ad-hoc addition by treating Agricultural income as income from other sources Rs. 2,13,220/-

From perusal of the assessment order and impugned order, we observe

that the assessee has failed to discharge his onus in substantiating the

sources of investment in land. The assessee has failed to show that the funds

invested in purchase of land were generated from agricultural income or from

gifts. Before the First Appellate Authority, the assessee has also tried to put

across new plea of assessee receiving advances against sale of property. On

all these submissions made by the assessee, the Commissioner of Income Tax

(Appeal) has observed as under:

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“4.24 Adverting to the fact in the instant case, it is evident that the explanation offered by appellant is not satisfactory. The story of advances received against sale of property is a concocted one and in my view, a device to evade tax. The creditworthiness of parties from whom advance is received nor the genuineness of transaction is established by appellant either before AO or me. Thus the assessee has not discharged its onus to prove the cash credits in its accounts. 4.25 It is also to be borne in mind that assessee has not produced its land dealing account. The advance received against sale of property has to be shown in receipt. So it will anyway suffer the incidence of taxation. In this case, since the same is added u/s. 68 no further addition is being made as it will tantamount to double addition. 4.26 In view of the aforesaid, discussion the factual and legal matrix of the case, the addition of Rs.25,42,000/ - u/s.68 made by AO is in order and is upheld.

xxxxxxxxxxxxxxxxx 5.3 I have considered the facts of the case, the assessment order and the submissions of the appellant. No documentary proof is submitted for agriculture income. The land holding of less than 1 acre does not corroborate the amount of income that can be generated. With the kind of land holding the appellant possesses, the AO has rightly estimated the agriculture income to be Rs.5 lacs. The Assessing Officer in my opinion has been reasonable in its estimation and the same is upheld. Further the gift is also not proved. The Hon'ble S.C. in Roshan D. Hatti, supra & Mohan Kale, supra, has clearly held that onus is on the assessee to prove the gift. The assessee has not discharged its onus. Since the source of investment made are not explained by the appellant to the satisfaction not he has been able to explain the same to me, the addition of Rs.12,07,835/- is rightly made. I do not find any infirmity in the order of the Assessing Officer. Hence, is upheld. Ground is dismissed.”

From the reading of above findings and in the absence of any contrary

material on record, we are satisfied that the finding of Commissioner of

Income Tax (Appeal) are reasoned and justified. Thus, we see no reason to

interfere with the order of First Appellate Authority in upholding the

additions. Accordingly, grounds No. 1 to 3 raised in appeal by the

assessee are dismissed.

of Income Tax (Appeal) in making addition of Rs.2,13,220/- by treating 70%

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of agricultural income as income from other sources on ad-hoc basis. The

Commissioner of Income Tax (Appeal) has confirmed the findings of Assessing

Officer on this issue by observing as under:

“6.3 I have carefully considered the facts of the case, the assessment order and the submissions of the appellant. The appellant has not maintained expenses and receipt account for agriculture operation. Merely by producing some sale patties and 7/12 extract cannot be testimony of agriculture income. It is to be borne in mind that sale proceeds of agriculture produce does not by itself translates into income. Income is Receipt minus expenditure. In this case no details of expenditure is produced. Agriculture being labour intensive, in my view, in absence of production of details of expenditure incurred for agriculture operations, the estimation of agriculture income by Assessing Officer is in order and is upheld. The amount of Rs.1,52,820/ - is rightly added as income from other sources as it cannot be allocated under specific head as envisaged u/s.14 of the Act. Income from other sources is a residuary head of income i.e. income not chargeable under any other head is chargeable to tax under this head. The Assessing Officer has rightly taxed the amount of Rs.1,52,820/ - as income from other sources. Ground is dismissed.”

There is no material on record to controvert the findings of Commissioner

of Income Tax(Appeal). Hence, findings of Commissioner of Income

Tax(Appeal) on this issue are also confirmed. Accordingly, ground No. 4

raised in appeal by assessee is dismissed.

Order pronounced on Friday, the 22nd day of June, 2018

Sd/- Sd/- (डी. क�णाकरा राव/D. KARUNAKARA RAO) (�वकास अव�थी /VIKAS AWASTHY) लेखा सद�य/ACCOUNTANT MEMBER �या�यक सद�य/JUDICIAL MEMBER

पुणे / Pune; �दनांक / Dated : 22nd June, 2018 SB

7 ITA No.1312/PUN/2017 A.Y.2009-10

आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to :

अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT(Appeal)-1, Nashik. 4. The Pr. CIT-1, Nashik. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “एक-सद�य” ब�च, 5. पुणे / DR, ITAT, “SMC” Bench, Pune. गाड� फ़ाइल / Guard File. 6.

// True Copy // आदेशानुसार / BY ORDER,

�नजी स�चव / Private Secretary आयकर अपील�य अ�धकरण, पुणे / ITAT, Pune.