A NAGARAJU vs. THE INCOME-TAX OFFICER

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ITA/2/2010HC KarnatakaKAHC01009634201018 December 2018Bench: RAVI MALIMATH,K.NATARAJAN7 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the assessee failed to produce relevant material before the Assessing Officer in a timely manner. The material produced was also not relatable to the assessment year in question, and therefore, the Tribunal was justified in confirming the estimation.

What were the facts?

The assessee declared substantial agricultural income along with other income. The Assessing Officer added a significant portion of the declared agricultural income, bank interest, and cash deposits to the total income. The CIT(A) partly allowed the appeal, accepting 25% of the agricultural income, and the Tribunal dismissed the assessee's further appeal.

What were the issues?

Whether the Tribunal was justified in confirming the estimation of agricultural income and levying interest under Sections 234A, 234B, and 234C when the assessee failed to provide adequate material to the Assessing Officer.

Which sections of the Income-tax Act were involved?

Section 260-A,Section 234A,Section 234B,Section 234C

AI-generated summary — verify with the full judgment below

1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU

ON THE 18TH DAY OF DECEMBER, 2018

BEFORE

THE HON'BLE MR. JUSTICE RAVI MALIMATH

AND

THE HON’BLE MR.JUSTICE K.NATARAJAN

INCOME TAX APPEAL NO.2 OF 2010

BETWEEN:

SHRI A. NAGARAJU, EX.MLA, NO.282, 11TH CROSS, 2ND PHASE, MANJUNATHANAGAR, BANGALOER.

...APPELLANT

(BY SRI V. CHANDRASEKHAR, ADVOCATE FOR SRI M. LAVA, ADVOCATE)

AND:

THE INCOME-TAX OFFICER WARD 9(2), III FLOOR, JEEVAN SAMPAGIE BUILDING, MALLESHWARAM, BANGALORE-560 003.

... RESPONDENT

(BY SRI K. V. ARAVIND, ADVOCATE)

2 THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME-TAX ACT 1961, ARISING OUT OF ORDER DATED 21-08-2009 PASSED IN INCOME TAX APPEAL NO.413/BNG/2009, FOR THE ASSESSMENT YEAR 2005-2006, PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN; ALLOW THE APPEAL AND SET ASIDE THE ORDER PASSED BY THE INCOME TAX APPELLATE TRIBUNAL BANGALORE IN INCOME TAX APPEAL NO.413/BNG/2009,DATED 21-08-2009, IN THE INTEREST OF JUSTICE AND EQUITY.

*****

THIS INCOME TAX APPEAL COMING ON FOR THIS DAY, RAVI MALIMATH J., DELIVERED THE FOLLOWING:

JUDGMENT

The assessee is an individual. He filed his return of income for the asst. year 2005-2006 on 31.01.2007, declaring the total income of Rs.2,88,000/- and agricultural income of Rs.22,20,000/-. On selection of the case for scrutiny, Notices were issued to the assessee. Thereafter, the Assessing Officer added the following amounts to the return of income:

Income returned Rs. 2,88,000/- Add: Income from other sources i) Out of agri. Income Rs. 16,65,000/- ii) Bank Interest Rs. 1,07,003/- iii) Cash deposits Rs. 20,09,000/-

Total Income Rs. 40,69,003/-

2.

Aggrieved by the same, an appeal was filed before the Commissioner of Income tax (Appeals), wherein the appeal was partly allowed, while accepting 25% of the agricultural income declared by the appellant. Questioning the same, the matter was taken before the Tribunal. The Tribunal dismissed the appeal. Hence, the present appeal by the assessee.

3.

By the order dated 12.04.2010, the appeal was admitted to consider the following substantial questions of law: “a) Whether the Tribunal was justified in law in confirming the estimation made by the Assessing Officer in respect of agricultural income at 25% on the agricultural income

4 declared by the appellant on the facts and circumstances of the case and consequently gave a perverse finding?

b) Whether the Tribunal was justified in levying interest under Section-234 A, 234 B, and 234 C of the Act on the facts and circumstances of the case?”

4.

Sri.V.Chandrasekhar, learned counsel for the appellant contends that substantial material was placed before the Assessing Officer, which he has failed to consider. That the material with regard to the assessee’s ownership of 15 acres of land and other relevant material pertaining to the same was not at all considered by the Assessing Officer. The counsel has accordingly placed on record the said material before this Court.

5.

The same is disputed by the learned counsel for the revenue.

6.

We have considered the material placed before us. The assessee has addressed a letter dated 31.12.2007

5 to the Income tax Officer with regard to production of various material before him. The same includes the RTC extracts for 15 acres of land, the lease agreement for the land in question and various other documents.

7.

On perusal of the same, we firstly find that the documents have been produced on 31.12.2007. The order of the Assessing Officer was passed on 28.12.2007. There is even a noting in the order of the Assessing Officer that when the matter was listed on 18.12.2007, an adjournment was sought for upto 24.12.2007. That on 24.12.2007, neither the assessee appeared nor he complied with the requirements as per the communication dated 11.12.2007.

8.

Secondly, the so-called material was not produced before the impugned order was passed by the Assessing Officer. He has since passed the order on 28.12.2007. Therefore, the Assessing Officer cannot be blamed for non-consideration of the material. The assessee

6 has deliberately not appeared before the Assessing Officer or furnished the documents.

9.

Even on perusal of the material, it would indicate that the RTC produced was for the year 2007- 2008, which was not relatable to the assessment year in question. Therefore, even if such material would have to be reconsidered, the same would not aid the appellant, under any circumstances.

10.

For the aforesaid reasons, we do not see any reason as to why an additional opportunity should be granted to the assessee at this stage. We have considered the question of remanding the matter. However, keeping in view the conduct of the assessee and the futility of reconsidering the material before us, the same would not serve any purpose.

11.

Under these facts and circumstances, we are of the view that the Tribunal was justified in confirming the estimation made by the Assessing Officer in accepting

7 only 25% of the total ‘agricultural income’ declared by the assessee. The substantial question of law is accordingly answered in favour of the revenue and against the assessee.

The appeal is accordingly dismissed.

Sd/-

Sd/- JUDGE

JUDGE

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