PUSHPA SOHANLALJI FOMRA,CHENNAI vs. ITO, NON CORPORATE WARD 12(3), CHENNAI

This appeal is filed by the assessee, aggrieved by the order of the Learned Commissioner of Income Tax(A)-13, Chennai dated 05.06.2017 pertaining to assessment year 2013-14.

The first issue raised in this appeal for adjudication is with regard to treatment of agricultural income as undisclosed cash credit.

The brief facts of the case are that during the Assessment Year 2013-14, the Assessee had admitted agricultural income earned of `6,50,000/- from a land situated at Sriperambadur B-Village. In the course of scrutiny, the Assessee was asked to furnish relevant documents pertaining to the agricultural income earned and the assessee accordingly furnished the documents including the Adangal for the Fasli Year 1425(01/07/2015 to 30/0/2016), issued by the VAO on 20/08/2015 as proof of agricultural income. The assessee further explained that the agricultural is from Paddy and was sold locally.

Before the Bench, the ld.A.R submitted that the assessee produced all requisite documents relevant to agricultural income earned including the Adangal issued on 20/08/2015 for the Fasli Year 1425(01/07/2015 to 30/0/2016). Subsequently, the ld. Assessing Officer summoned the VAO u/s.131 of the Act and recorded a sworn statement stating that the lands are barren lands and no agricultural activities were carried out in the financial year 2012-13. Later, the VAO cancelled the Adangal issued on 20/08/2015 stating that the Adangal does not belong to the Financial year 2012-13. It was submitted by the ld.A.R that the assessee was not given an opportunity to cross examine the submissions of the VAO and the ld. Assessing Officer decided the case against the assessee at the back of the assessee. Further, the ld.A.R submitted that in the earlier year, the agriculture income was accepted by the Department and only from the present assessment year, it was not accepted. According to him, thee should a consistency in income tax proceedings for each assessment year, the ld. Assessing Officer cannot take a different view on the same set of facts.

On the other hand, ld.D.R relied on the order of lower authorities and submitted that the assessee had not produced any relevant evidence to prove that the assessee carried on agricultural operations in the said land owned by the assessee and assessee has to furnish relevant documents pertaining to the agricultural income earned.

I have heard both the parties and perused the material on record. Admittedly, in this case, the owning of agricultural land is not disputed by the lower authorities. Further, it is also undisputed fact that in earlier years, the declared the agricultural income, which was accepted by the ld. Assessing Officer. But, only in this assessment year under consideration, the same income was not accepted as agricultural income. There was a statement recorded from VAO u/s.131 of the Act and principles of natural justice requires to provide proper opportunity to be given to the party to cross examine the submissions of the VAO, if such third party statements relied upon by A.O to complete the assessment. Hence, in the interest of justice, I am inclined to remit the entire issue to the file of ld. Assessing Officer to give copy of sworn statement recorded from VAO u/s.131 of the Act to assessee and also to consider the agricultural income declared by the assessee in earlier assessment years to come to conclusion for present assessment year on this issue. With this observation, I remit the issue to the file of ld. Assessing Officer for fresh consideration.

The next issue is with regard to taxing of interest income.

In the result, the appeal of assessee is partly allowed for statistical purposes.