NEELAKANTH KUNTOJI BASAVARAJ ,BENGALURU vs. INCOME TAX OFFICER, WARD-6(2)(1), BANGALORE

There is a delay of 148 days in filing this appeal before the Tribunal. Assessee has filed an application for condonation of delay stating therein the reasons for the belated filing of this appeal. On perusal of the reasons stated for late filing of the appeal, we are of the view that no latches can be attributed to the assessee as there is sufficient cause for belated filing of this appeal. Hence, we condone the delay and proceed to dispose off the matter on merits.

The grounds raised read as follows:

Assessee, an individual, is engaged in the business of manufacturing of fabricated metal products. For the Assessment Year 2020-21, the return of income was filed under section 139(1) of the Act declaring total income of Rs.33,13,640/-. Assessee has also declared net agricultural income of Rs.27,76,000/-. The assessment was selected for limited scrutiny under CASS to examine the claim of receipt of agricultural income. During the course of assessment proceedings, the AO noticed that assessee had shown gross receipts from agricultural produce to the tune of Rs.48,54,000/- and expenditure incurred for earning the said agricultural income was shown at Rs.20,74,000/-. The AO issued several notices under section 142(1) of the Act. However, there was no response to the same by the assessee. Thereafter, show cause notice was issued to the assessee under section 144 of the Act, proposing to make an addition of the gross income of Rs.48,50,000/- as income from undisclosed source. In response to the show cause notice issued under section 144 of the Act, assessee filed online response stating assessee is directly owning 15 acres of cultivated area and also submitted some invoices for the sale of agricultural produces. Thereafter, in response to the notices issued by the AO, there was no compliance by the assessee.

Aggrieved by the Assessment Order, assessee preferred an appeal before the First Appellate Authority. The CIT(A) passed an ex-parte order since assessee did not respond to the several notices issued by the Office of the CIT(A) directing him to file the written submissions / evidences.

Aggrieved by the Order of the CIT(A), assessee has filed the present appeal before the Tribunal. Assessee has filed application for admission of additional evidence under Rule 29 of the Income Tax Rules, 1962. The additional evidence submitted by the assessee is affidavit of the assessee’s father stating therein that he was looking after the assessee’s agricultural property and had given a sum of Rs.27,76,000/- which was saved over the past three years, the RTC and Phanis of the agricultural land held by the assessee and his father is to the extent of Rs.23 acres and 34 guntas, etc. The learned AR submitted that AO has erred in stating that assessee is owner only to the extent of 9.41 acres of the land. It was submitted that assessee was owning more than 15 acres of land and about 8 acres is held by his father, the income from which the assessee was enjoying. It was further contended that assessee had disclosed only agricultural income of Rs.27,76,000/-, however, the addition made under section 68 of the Act on account of excess agricultural income is Rs.46,27,658/- which is unjustified and against the legal principles. It was submitted that assessee had produced various sales invoices which was not been properly taken note of by the AO nor the CIT(A).

The learned DR, on the other hand, supported the orders of the AO and the CIT(A).

We have heard the rival submissions and perused the material on record. Assessee in the return of income had disclosed agricultural income of

Assessee had filed an application under Rule 29 of the Income Tax Appellate Tribunal Rules, 1963. Assessee had produced in vernacular the RTC, Phanis, title deeds, etc., to claim that he is enjoying agricultural income from 23 acres and 34 guntas of land. Additional evidence now filed before the Tribunal goes to the root of the issue raised before the Tribunal and we deem it appropriate to admit the same. Since we have admitted the additional evidence, it is necessary that the matter be examined by the AO [since there has been no proper representation by the assessee before the AO nor the CIT(A)]. Therefore, the AO is directed to draw a fresh assessment by taking into consideration the evidence / material produced by the assessee, to prove his case that he was in receipt of net agricultural income of Rs.27,76,000/-.

Before concluding, it is to be mentioned that assessee has not responded to several notices issued from the Office of the AO as well as the CIT(A). We strongly deprecate the nonchalant attitude of the assessee. As a last opportunity and in the interest of justice and equity, we are restoring the matter to the files of the AO so that a proper assessment can be framed in the case. The assessee is directed to co-operate with the AO and shall not seek unnecessary adjournment. It is ordered accordingly.

In the result, appeal filed by the assessee is allowed for statistical purposes.