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Income Tax Appellate Tribunal, Delhi Bench “F”, NEW DELHI
Before: SHRI AMIT SHUKLADr. B.R.R. KUMAR
PER B.R.R.KUMAR, ACCOUNTANT MEMBER :
This appeal has been filed by the assessee against the order of the ld. CIT(A)-36, New Delhi, dated 09.02.2018.
The assessee filed return of income on 26.09.2014 declaring total income at Rs. 35,41,120/-. During the assessment proceedings the assessee was asked to produce the following details :-
“1. Date of purchase of land and copy of sale deeds,Khasra and khatauni. Pleased also state correct particulars of location of land, surroundings and distance from river. District headquarters, distance from mandi samiti, food again market and railway station. 2. Details of area covered for each harvest.
3. True and correct particulars of herbs grown in the land.
Date wise sale of agricultural produce of herbs. 5. Details of parties along with names and addresses to whom agricultural produce have been sold. 6. Please produce vouchers of purchase of seeds. 7. Please furnish complete addresses, contact numbers, ledger accounts, PAN of following parties. 1. M/s. Sankalp Trading Company, Jhansi 2. M/s. Peetambra Herbs, Jhansi 3. M/s. Jai Maa traders, Jhansi 8. Please furnish technical/ agricultural details of preparing soil for herbs namely bhringaraj, Jatamasi, Arnimool, Kharenti, Kateri satavari, Naganvotba, Dhaturapancbang, Akarkara, Aliea/a. safed niusli, Adusa,Neern pattr, Pnyangu, Ashgadh. Aleovera(Gwaipadia),Baboolchal, Arjun Civil, Giloy, Pusbkarmmol, Ginger, Vidharamool, Nishoth, Given AMI A. 9. How is it possible that in one type of climate, you have grown all the above herbs, which individually require different soil, weather and climate. Please substantiate genuineness of growing all herbs in your land. Jatarnasi is grown on steep hills. How could you grow Jatarnasi in your land in Jhansi? Satavari in grown is sandy and red soil and needs specific range of temperature. How could you grow Satavari your land? Nagarmotha is grown in water borne and wet places. How could you grow Nagarmotha in your land ? 10. Please furnish details of expenses on fertilizers
and pesticides in each harvest as all the herbs required specific type of fertilizer and pesticides. 11. All the herbs require specific processing for the purpose of marketing and sale. Please furnish detaisl of such processes and expenses incurred in such processes. 12. Please substantial genuineness of Agriculture and Income.”
The assessee stated that she possessed 14.92 acres of land at Jhansi and carried out agricultural activity through her care taker employee. She supported the agricultural income through Khasra and Khatauni issued by local Tehsildar. It was stated that out of gross agricultural income of Rs. 28.56 lakh, the agricultural income of Rs. 21,74,000/- (77%) was carned from sale of Jaributi (Herbs). The balance agricultural of 23% was on account of agricultural produce of wheat, gram and ground nuts. It was stated that Jaributies were sold to certain parties of Jhansi on the bill book of Mrs. Poonam Sharma without any particulars of buying parties namely M/s. Sankalp Trading Company, Jhansi, M/s Jaima Traders. These bill books are self printed without any particulars of Sale Tax Number, VAT of the seller and buyer. There are no bills of the above entities M/s. Sankalp Trading Company, M/s. Peetambra herbs & M/s. Jaimaa Traders. These entities have no proff of identities and genuineness of business.
4. The AO asked the assessee to substantiate genuineness of agricultural operation of herbs, which are grown in certain specified climatic conditions not available in Jhansi thus, falsifying the theory of agricultural operation of the herbs.
5. The AO held that the assessee has failed to substantiate genuineness of agricultural operations of herbs, she has also failed to substantiate any process to make herbs saleable commodity. Herbs are not like vegetables, “kheton se nikala aur bazaar mein bech diya”. There are specific guidelines for maintaining distance between plants, their protection, application of specific fertilizers and post-agricultural production procedures before making sale. There are well defined procedures to process a particular herb and it is time taking process. If she could do so, she should take the technology to Agriculture Universities and ICAR so that the country is immensely benefited.
Holding thus,, the AO held that the agricultural income received from assessee cannot be accepted as genuine and treated it as income from business and profession.
The Ld. CIT(A) reduce the addition of Rs. 23.41 lakhs to 18.03 lakhs after re-computation of acrage of the land.
Aggrieved the assessee filed appeal before us
We have gone through the material before us. We find that the assessing officer went theoretically without any tangible material to disprove the claim of agricultural income. While the assessee has produced bills from three entities the AO has not conducted any enquiries to prove that the bills or fake or bogus. Had it been proved the case for providing incorrect, tampered evidences could have been made . The assessing Officer as well as revenue has also ignore the earlier history of the assessee from A.Y 1994-95 to A.Y. 2015-16 wherein earlier income declared by the assessee has been accepted under section 143(3) proceedings for various years. The details are as under :-
S. No. Assessment Year Agriculture Income Assessed u/s 143(3) 1. 1994-1995 168,046 2. 1995-1996 312,768 3. 1996-1997 445,892 143(3) 4. 1997-98 445,716 143(3)
1998-99 476,640 143(3) 6. 1999-00 499,704 7. 2000-01 505,690 8. 2001-02 571,498 9. 2002-03 626,508 10. 2003-04 864,030 143(3) 11. 2004-05 1,054,011 12. 2005-06 1,120,308 13. 2006-07 973,444 143(3) 14. 2007-08 998,289 143(3) 15. 2008-09 1,213,591 143(3) 16. 2009-10 1,311,842-200000 250/143(3) 17. 2010-11 1,361,184 18. 2011-12 1,542,392-100000 250/143(3) 19. 2012-13 1,681,396 143(3) 20. 2013-14 2,202,075 143(3) 21. 2014-15 2,341,597 Under appeal 22. 2015-16 25,92,275-150000 143(3)
Thus, on going through the entire facts and circumstances of the case, we hold that there is no tangible material collected by the revenue to prove or to treat the income declared by the assessee as income from business and profession but income from agriculture.
In the result, appeal of the assessee is allowed. Order pronounced in open court on 23rd day of November, 2021.