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Facts
The assessee, an agriculturist, deposited Rs. 16,90,000 in cash, claiming it as income from agricultural produce. The Assessing Officer (AO) added this amount under Section 69A for unexplained money, as the assessee could not prove the source to the AO's satisfaction. The CIT(A) upheld the addition, citing the lack of an agricultural income certificate.
Held
The Tribunal found the CIT(A)'s order perverse and bad in law, as the Department accepted the assessee was an agriculturist and earned income from agricultural produce. The Tribunal noted the Department failed to provide evidence of any other undisclosed income and that requiring an 'Agricultural Income Certificate' from a 'concerned authority' for every farmer is unrealistic. The addition was deemed arbitrary and malicious.
Key Issues
The key legal issue was whether cash deposits made by an agriculturist, claimed as income from agricultural produce, could be added as unexplained money solely due to the absence of an 'Agricultural Income Certificate' when the Department accepted the assessee's status as an agriculturist.
Sections Cited
Section 69A
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Income Tax Appellate Tribunal, RAIPUR BENCH “SMC”, RAIPUR
Before: SHRI PARTHA SARATHI CHAUDHURY
आदेश / ORDER
PER PARTHA SARATHI CHAUDHURY, JM
The present appeal preferred by the assessee emanates from the order of the Ld.CIT(Appeals)/NFAC, dated 01.12.2025 for the assessment year 2016-17 as per the grounds of appeal on record.
During the course of assessment proceedings, it was observed by the A.O that the assessee had made total cash deposits of Rs.16,90,000/-. The assessee submitted before the A.O that he is an agriculturist and the source of the said cash deposits is from selling of the agricultural produce in the local market. However, since the assessee was not able to prove his contentions to the satisfaction of the A.O, the A.O made an addition of Rs.16,90,000/- on account of unexplained money u/s. 69A of the Act.
That before the Ld. CIT(Appeals)/NFAC, the assessee had filed detailed written submissions explaining the cash deposits and reiterated that the source of money is from sale of agricultural produce in the local market. The Ld. CIT(Appeals)/NFAC admits that the assessee had deposited an amount in the bank account from agricultural income for the year under consideration but upheld the addition made by the A.O on the ground that the assessee has not submitted any agricultural income certificate from the concerned authority. In such premises of the 3 Shri Kamta Sahu Vs. ITO, Ward-1(2), Raipur (C.G.)
Ld. CIT(Appeals)/NFAC is perverse, arbitrary and bad in law since the Department has accepted that the assessee is an agriculturist and has earned income from sale of agricultural produce in the local market. The Department has not brought out any evidence to suggest any other undisclosed source of income by the assessee. The Revenue is harping upon non-furnishing of “Agricultural Income Certificate from the concerned authority.” It is hard to believe that such evidence exists at all since in the entire country majority of the people are having livelihood through farming and in such scenario, what is the concerned authority who can issue “Agricultural Income Certificate” to each of such persons, is rather anonymous and far beyond human probabilities.
The Ld.CIT(Appeals)/NFAC has not conducted any independent inquiry and rejected the submissions of the assessee without also bringing on record any further undisclosed sources of income. That when the Department accepts that the assessee is earing income from agricultural activities, when the Department has not brought on record any evidence regarding undisclosed sources of income, when the Department itself has not conducted any independent inquiry against the claim made as per written submissions filed by the assessee, in such scenario, making
In view of the aforesaid facts, I set-aside the order of the Ld. CIT(Appeals)/NFAC and direct the A.O to delete the addition from the hands of the assessee while giving effect of this order.
As per the above terms grounds of appeal of the assessee are allowed.
In the result, appeal of the assessee is allowed. Order pronounced in open court on 5th day of February, 2026.