SHRI PAWAN JAJOO,MUMBAI vs. INCOME TAX OFFICE (7)(4), MUMBAI

During the course of assessment proceedings for A.Y. 2019-20, the assessee was asked to explain the source of cash found and also to substantiate that ₹2 lacs belong to her sisters. The learned Assessing Officer also issued notice under Section 133(6) of the Act to Fakir Chand Lockers and Vaults Pvt. Ltd. on 12th April, 2021, asking for certain KYC information. However, no such information was received. The learned Assessing Officer questioned the assessee once again to file necessary details and assessee was given several opportunities. On 19th May, 2021, the assessee submitted that he is 04. engaged in agricultural activities and brokerage. The details were asked about these activities and its income such as, Mandi Bills, Purchase Invoices of the seeds and cultivation reports. The assessee was also asked the details about her sisters and when she deposited money with him. On submission of certain details, the learned Assessing Officer issued notice under Section 133(6) of the Act to his sisters, Anita Devi Baldeva [ sister of

For A.Y. 2019-20, with respect to the addition of ₹14 lacs he also upheld the addition for the reason that there is no plausible explanation of saving of the assessee of ₹12 lacs put in the locker. He further held that as the cash was found in the denomination of ₹2000/- notes which was only available after 8th December, 2016, could not have

Therefore, assessee aggrieved with appellate order is in appeal before us for all these years. The assessee submitted two paper books containing 73 pages and 32 pages before us. In paper book containing 32 pages of the submissions made before the lower authorities are enclosed. In paper book containing 73 pages, the assessee submitted that there is an agricultural land situated at village Rajdev Tehsil Dungargarh, District Bikaner, Rajasthan, wherein the assessee is part owner of 94.3 hectares of the land. The share of the assessee in the land is 1/7th. Therefore, he is owning 33.23 acres of land. For this, he submitted P-13-N statement of agricultural land holding. In those statements, the various agricultural produced were also mentioned.

For A.Y. 2013-14 to A.Y. 2018-19, he also submitted a statement of income which in fact were the copies of return originally filed. In the second paper book, he referred to page no.3 stating that he earned a meager agricultural income for all these years which were disbelieved by the learned Assessing Officer. He submitted that up to 2018-19, he has total agricultural income for all these six years amounting to ₹10,93,500/-. He further stated that he has also accumulated brokerage

Before us, he also submitted that [1] there is no notice issued to the assessee under Section 143(2) of the Act for A.Y. 2013-14 to 2018-19, and on this ground also the assessment order passed is invalid and [2] referred to the assessment orders and stated that agricultural income added in the hands of the assessee for earlier six years has once again being added in the hands of the assessee in A.Y. 2019-20, [3] He also challenged the fact that there is no incriminating material found during the course of search with respect to earlier years and therefore, for A.Y. 2013-14 to 2018-19, no addition could have been made in the hands of the assessee.

The learned Departmental Representative vehemently supported the order of the learned lower authorities and submitted that in absence of any substantial detail of agricultural activities, the agricultural income shown by the assessee has been correctly added as income from undisclosed sources in the hands of the assessee. Further, the argument of the assessee of ₹2 lacs received from his sisters is also unsubstantiated and merely an affidavit is filed. He further stated that even if the income of the assessee is considered to be out of his past savings, there is no explanation that how he came into the possession of

We have carefully considered the rival contentions and perused the orders of the lower authorities. We have also perused the paper books filed and arguments raised before us. The fact clearly shows that assessee is an individual earning income from brokerage and agricultural activity. In Locker no.104, with Fakir Chand Lockers and Vaults Pvt. Ltd. of New Delhi, assessee was found to be having that locker wherein cash of ₹14 lacs was found. The explanation of the assessee that cash of ₹12 lacs belongs to him out of his agricultural activities and past savings and further ₹ 2 lacs is given to him by his sisters. This explanation was disbelieved by lower authorities. We find that undoubtedly, the assessee has 1/7th share in agricultural land situated at village Rajdev Tehsil Dungargarh, District Bikaner, Rajasthan. The total land holding pertaining to the assessee is ₹33.24 acres . This land holding is undisputed. In the land records there are certain agricultural produce mentioned with respect to each of the year for past six years. The assessee has shown agricultural income in the range of ₹1.68 lacs to ₹1.98 lacs. With respect to the proof of sale of agricultural produce the assessee has also submitted the agricultural produce marketing committees receipts on sample basis. Undisputedly, assessee has not submitted complete details of the agricultural produce for all these years. However, on looking at the holding of the agricultural records of land holding, the agricultural produce mentioned there in and

Coming to the A.Y. 2019-20, where the additions of ₹14 lacs is made, the source is explained by the assessee being ₹ 12 lacs out of past savings. Source of this ₹ 12 lacs is stated to be an agricultural income of ₹10,93,500/- and balance of ₹1,06,500/- out of his saving from Petty Commission Activities. On looking at the income offered by the assessee for A.Y. 2013-14 till 2019-20, it is apparent that assessee has disclosed total income of commission and bank interest for all these years of approximately ₹10 lacs. Even after accounting for all expenditure out of this sum, the savings of only ₹1,60,000/- being 5% of his other income cannot be disbelieved. Therefore, the additions to the extent of ₹12 lacs in the hands of the assessee out of ₹14 lacs are explained.

Further, it is apparent that for A.Y. 2013-14 till A.Y. 2018- 19, no incriminating evidence is found during the course of search. On that basis also, there cannot be any addition in

It is also apparent that for all these assessment years, there is no reference of issue of notice under Section 143(2) of the Act. The assessments have framed under Section 153A of the Act but no notice under Section 143(2) of the Act has been issued.

However, as the addition stands deleted on the merits itself, there is no reason to deal with the other legal grounds of incriminating material as well as non-issue of notice under Section 143(2) of the Act, which are left open.

In the result, all 7 appeals filed by the assessee are allowed.