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Income Tax Appellate Tribunal, PUNE BENCHES “SMC” :: PUNE
Before: MS. ASTHA CHANDRA & DR. DIPAK P. RIPOTE
ORDER
PER DR. DIPAK P. RIPOTE, AM:
This is an appeal filed by the Assessee against the order of ld.Commissioner of Income Tax(Appeal)[NFAC], u/sec.250 of the Act dated 23.02.2024.The Assessee has raised following grounds of appeal :
1. The learned CIT(A) erred in confirming the addition of Rs.9,06,000out of the total addition of Rs. 10,06,000 made by the A.O. towards alleged unexplained cash deposits in bank account during demonetization period without appreciating that the said cash deposits
Ashok Chandrabhan Khandave [A] were sourced out of agricultural income earned by the appellant and hence, the above addition made by the A.O. was not justified on facts and in law.
The learned CIT(A) failed to appreciate that the appellant individual is purely an agriculturist residing in rural area, owning around 11.50 acres of agricultural land under cultivation and the assessee had furnished documentary evidences in support of the agricultural income earned by him and hence, the above addition made by the A.O. was not justified on facts of the case and in law.
The learned CIT(A) ought to have appreciated that the A.O. had not brought any material on record to prove that the appellant agriculturist residing in rural area, had any other source of income apart from agriculture and hence, the A.O. was not justified in rejecting the explanation of the appellant and taxing the said cash deposits as unexplained income u/s 68 merely on the basis of suspicion and surmises.
4. Without prejudice to the above grounds, the appellant submits that the appellant had not maintained any books of accounts since he was not liable to maintain the same as per law and hence, the addition made by the A.O. by invoking the provisions of section 68 towards alleged unexplained cash credits made in books of accounts, was apparently unjustified in view of the law laid down by Hon’ble Jurisdictional High Court in CIT v. Bhaichand H. Gandhi [141 ITR 67 (Bom)] and hence, the said addition may please be deleted.
5. The appellant craves, leave to add, alter, amend and delete any of the above grounds of appeal.”
Ashok Chandrabhan Khandave [A]
2. At the outset of hearing, no one appeared on behalf of the assessee. No adjournment letter was filed.
2.1 We have heard ld.Departmental Representative for the Revenue and perused the records.
Findings & Analysis : 3. It is mentioned in the assessment order that the Assessing Officer(AO) received information regarding cash deposit to the extent of Rs.10,06,000/- into ICICI Bank Account. Assessee had not filed return of Income for A.Y.2017-2018. Therefore, the Assessing Officer issued notices to the Assessee.The assessee filed return of Income for AY 2017-18 on 21/09/2019 (copy of the return filed is on record). During the assessment proceedings the Assessee submitted to the AO that assessee is an agriculturist and hence not liable to file Income Tax Return. During the assessment proceedings the Assessee filed copies of 7/12 extracts, copies of the bills for sale of agricultural produce, copy of Bank statement. Assessee submitted before the AO that the Cash has been deposited in the Bank account of the assessee from Sale of Agricultural produce. However, the AO made the addition u/s 68
Ashok Chandrabhan Khandave [A] of Rs.10,06,000/- treating the claim of the assessee as a colorable device. The Ld.CIT(A) confirmed the Addition.
We have gone through the submission of the assessee dated 23/09/2019 which was filed by the Assessee during the Assessment proceedings. (The copy of the said submission was filed by the ld.DR at our request.). On perusal of the said submission it is observed that the Assessee owns agricultural land in the village Pimpalner, Taluka Dindori,Dist Nashik.Copies of the 7/12 are on record. The Talathi has recorded Crops taken in two seasons in the said 7/12 extracts. Thus, it is established from the Government land revenue records that Assessee owns Agricultural land and assessee has grown various crops in two crop seasons i.e. Kharip and Rabbi. The assessee has also filed copies of bills for the sale of agricultural crops before the AO. In these facts and circumstances, the assessee has fulfilled his onus of proving the source of impugned cash, by filling copies of the sale bills, 7/12, bank statement. The AO has not doubted genuineness of these bills. The AO has not carried out any inquiry with reference to the bills or 7/12 filed by the assessee. Once the assessee had filed these documents the Burden of Proof shifted to the Assessing
Ashok Chandrabhan Khandave [A] Officer.The AO has merely mentioned one sentence that it is a colorable device. The onus was on AO to prove that the bills filed are not genuine. AO failed to do so. The AO had not carried out any inquiries. In the assessment order, in para 9, while calculating the total income, Assessing Officer has mentioned as under : Income as per return of income : Rs. No return Add : As discussed above : Rs.10,06,000/- Assessed Income : Rs.10,06,000/- 4.1 Thus, in the para 9 of the assessment order, Assessing Officer carelessly wrote that “No return”, whereas in the same assessment order in paragraph 5, the Assessing Officer has mentioned “assessee filed return of income on 21.05.2019 declaring total income of Rs.16,200/- and agricultural income of Rs.10,40,435/-”. In paragraph 5, Assessing Officer has also mentioned assessee filed copies of sale bills for agricultural produce, copy of 7/12 extract of land holding and copies of bank account statement. Thus, in the assessment order, Assessing Officer admitted that assessee filed return of income but in para 9, wrote “No return”. The Assessing Officer in the assessment order has nowhere mentioned that notice u/sec.143(2) was served on assessee. On perusal of the records, it is clear that no notice u/sec.143(2) was issued. Therefore, in the facts and circumstances of the case, we
Ashok Chandrabhan Khandave [A] are of the considered opinion that the additions made by Assessing Officer u/s.68 of Rs.10,06,000/- is not sustainable in the eyes of law. Accordingly, we direct the AO to delete the addition of Rs.10,06,000/-.
In the result the appeal filed by the Assessee is allowed.
Order pronounced in the open Court on 28th June, 2024.