CHANNABASSAYYA JAGADEESH ,TUMKUR vs. INCOME TAX OFFICER, WARD-1 & TPS , TUMKUR

Before going to the merit of the case first we proceeds with the Application for condonation of delay. There is a delay of 140 days in filing the appeal before this Tribunal. The assessee explained the delay by way of condonation petition stating that the appellant completely unaware of passing of order since the same was categorised as SPAM in the email box. After receiving the call from the income tax department regarding the recovery of demand, during the last week of March, 2024, the appellant came to know about such fact & immediately approached to the

The brief facts of the case are that the assessee being an individual is a non-filer of income tax return for the A.Y. 2017-18 either u/s. 139 or 142(1) of the IT Act, 1961. Since the assessee had not filed the return in response to the notice also, the assessment was proceeded with and concluded u/s. 144 of the IT Act, 1961 by making addition u/s. 69A of the IT Act as unexplained money as under: “Unexplained money not accepted as agricultural income - Rs.9,73,950/- Unexplained money not accepted as loan from Sri Mahesh - Rs.3,25.000/- Unexplained money with regard to transaction With Hanuman Saw Mills, Tumkur - Rs.2,51,373 Total Unexplained money u/s 69A of I.T.Act, 1961 - Rs.15,50,323/-“

Ground no. 1 raised by the appellant are general in nature and does not require adjudication. Hence dismissed.

Ground no. 2 relates to the disallowance of agricultural income of Rs. 9,73,950/- (12,23,950 - 2,50,000) and treated as not

During the course of assessment proceeding, the assessee vide letter dated 24.09.2019 has declared agricultural income of Rs.12,23,950/- whereas as claimed by the Ld.AO, the assessee vide letter dated 09.09.2019 had declared agricultural income of Rs.2,15,000/- while explaining the source of credit into the bank accounts. Before the Ld.AO, the assessee has furnished copies of RTC, certificate from Tahsildar stating that cultivation of land is done in 1.5 acres of land and also produced some copies of sales bills. The assessing officer observed that assessee had not furnished any substantial documentary evidence like details of cultivation of crops, sale of crops, expenditure incurred etc to prove that the assessee earned an agricultural income of Rs. 12,23,950/- during the Financial Year 2016-17. In the absence of details and documentary evidence, the huge agricultural income of Rs.12,23,950/- with a land holding of 3.38 acres was not accepted and accordingly concluded by estimating the income derived by the assessee from agricultural activity amounting to Rs.2,50,000/- as income from agriculture.

The Ld.CIT(A) on the other hand, held that as the appellant had not filed his return of income for A.Ys. 2016-17, 2017-18 and 2018-19 & the appellant had also not filed the complete details and supporting documents relating to the huge agricultural income, upheld the order of Ld.AO. Before us, the Ld.AR vehemently argued that the assessee is a pure

We have heard the rival submissions and perused the material on record.

It is an undisputed fact that from the copies of RTC furnished by the assessee, it is seen that the total land holding is 3.38 acres in survey nos. 195, 196 & 197, Kumbhathanahalli, Guluru Hobli, Tumkur Taluk and the crop cultivated is coconut. We also cannot brush aside the fact that a certificate from Tahsildar stating that cultivation of land is done in 1.5 acres of land and some sale bills were also produced before the assessing officer during the course of assessment proceeding. As the assessee could not furnish details of cultivation of crops, sale of crops,

Ground no. 3 relates to addition of Rs.3,20,000/- which was received as a loan from relative Mr. Mahesh. During the course of assessment proceeding, the assessee had stated that one of the source for cash deposit was loan obtained from Shri Mahesh amounting to Rs.3,25,000/- who had given interest free loan. The confirmation letter along with the PAN of Shri Mahesh is also furnished before the Ld.AO. But the Ld.AO on the ground that Shri Mahesh is also a non-filer of income tax return and the assessee has not produced any documentary evidence to prove the source of income and credit worthiness of Shri Mahesh and accordingly treated the entire amount of Rs. 3,25,000/- as not accounted for by the assessee and hence brought to tax as unexplained money u/s. 69A of the IT Act. The Ld.CIT(A) on the ground that appellant’s claim is not found plausible and mere filing the confirmation of lender is not sufficient to establish the identity, genuineness and credit worthiness of the lender dismissed this ground of appeal. Aggrieved by the order of the Ld.CIT(A), the assessee is before us.

Ground no. 4 relates to addition of Rs.2,51,373/- as unexplained credit in the bank account which is a cheque reversal entry as claimed by the assessee. During the course of the assessment proceeding, the assessee has stated that the source of deposit of Rs.2,51,373/- is from Sri Hanuman Saw Mills, Tumkur who has purchased wood from the assessee on credit. The assessee has also furnished copy of credit bill dated 14.03.2017 issued by Sri Hanuman Saw Mills for Rs. 2,51,373/-. Except these as the assessee had not furnished any details / documentary evidence for the above transaction and accordingly an amount of Rs.2,51,373/- was treated as not accounted for and brought to tax as unexplained money u/s. 69A of the IT Act, 1961. Before the Ld.CIT(A), the appellant claimed that the amount of Rs.2,51,373/- credited to the bank of the appellant is nothing but reversal of the cheque due to the

Before us, the Ld.AR of the assessee vehemently argued that this was the cheque bounced and reversed in the Bank Account of the Assessee on account of insufficient funds or due to technical reasons on account of transactions of wood purchase from M/s Hanuman Saw Mills. The dishonoured Cheque was reversed in the bank and the same was erroneously considered as a fresh credit & treating the same as Unexplained and prayed to delete this addition confirmed by the authorities below. The Ld.DR on the other hand, supported the order of the authorities below. We have heard the submissions and perused the material on record.

We are of the opinion that in the interest of justice and equity and as prayed by the Ld.AR of the assessee, we deem it fit to remit this issue to the file of Ld.AO for examining the same by verifying the bank accounts as well as the credit bill after giving an opportunity of being heard to the assessee. Accordingly, the ground no. 4 is also partly allowed for statistical purposes.