NIRBHAYA SINGH,UJJAIN vs. INCOME TAX OFFICER 1(1), UJJAIN

Feeling aggrieved by appeal-order dated 13.12.2023 passed by learned Commissioner of Income-Tax (Appeals), NFAC, Delhi [“CIT(A)”] which in turn arises out of assessment-order dated 25.10.2016 passed by learned ITO, 1(1), Ujjain [“AO”] u/s 144/147 of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2009-10, the assessee has filed this appeal on following grounds:

The brief facts are such that the assessee-individual is stated to be engaged in doing agricultural work only. The AO, based on an information from A.I.R. that the assessee has made a total cash deposit of Rs. 15,00,000/- in Narmada Malav Gramin Bank during the previous year 2008-09 relevant to AY 2009-10, issued notice u/s 148 followed by notice u/s 142(1) to assessee. However, finding no response from assessee, the AO ultimately passed assessment-order u/s 144 r.w.s. 147 of the Act assessing the entire deposits of Rs. 15,00,000/- as income from undisclosed sources.

Still not satisfied by the relief given by CIT(A), the assessee has come in next appeal before us.

Ld. AR for assessee drew our attention to the submission made by assessee in first-appeal recorded by CIT(A) in Para No. 4.0 of his order, re- produced above. Referring to same, Ld. AR explained that the assessee is an agriculturist and the sole source of income is agriculture from about 22 bighas of irrigated land. So far as the source of deposits in bank a/c is concerned, the assessee explained two sources to CIT(A) in Point 10 of his submission, namely (i) the assessee sold part of his agricultural land for Rs. 6,50,000/- (correct figure is Rs. 6,50,500/-) on 21.03.2009 for which advance of Rs. 6,00,000/- was received on 15.10.2008, and (ii) remaining cash was deposited out of early years’ savings and agricultural income. The assessee also submitted copy of registered sale-deed to CIT(A). However, while adjudicating first-appeal, the CIT(A) has only given benefit of funds available from agricultural income to the extent of Rs. 7,50,000/- only. The CIT(A) has not given benefit of sale-proceed of agricultural land by saying that no documentary evidence was filed. Ld. AR submitted that the CIT(A)’s stand that no documentary evidence of sale of land was filed, is contrary to the record because the assessee actually filed sale-deed and also mentioned so in the submission filed to CIT(A). Ld. AR pointed out that the assessee has filed a copy of the same deed in Paper-Book at Page 8-12 and makes a limited prayer to allow the benefit of sale-proceed of Rs. 6,50,500/- mentioned therein.

Ld. DR for revenue supports the orders of lower-authorities but however leaves the issue for the wisdom of bench.

We have considered submissions of both sides and perused the orders of lower-authorities as also the documents in Paper-Book. After a careful consideration, we find that as per Para No. 5.4 of CIT(A)’s order, the assessee has made deposits of Rs. 15,00,000/- in bank a/c on different dates, namely Rs. 6,50,000 (17.10.2008), Rs. 90,000 (17.10.2008), Rs. 10,000 (20.10.2008) and Rs. 7,50,000 (Rs. 23.03.2009). The CIT(A) has already accepted availability of funds to the tune of Rs. 7,50,000/- from agricultural income. The assessee has filed copy of registered sale-deed dated 21.03.2009 and Page 2 thereof shows the receipt of Rs. 6,50,500/- in cash prior to sale-deed, the same is scanned and re-produced below for an immediate reference:

On perusal, we find that the assessee has received sale consideration of Rs. 6,50,500/- in cash prior to sale-deed i.e. before 21.03.2009 and, thus, the assessee is having available source for further explaining deposits to the extent of Rs. 6,50,500/-. Being so, we are inclined to grant a further relief of Rs. 6,50,500/- to assessee out of the addition of Rs. 7,50,000/- sustained by CIT(A). The AO is directed to modify assessment-order accordingly. The assessee succeeds partly in this appeal.

Resultantly, this appeal is allowed partly.