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Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT
Before: SMT. ANNAPURNA GUPTA & SHRI SIDDHARTHA NAUTIYAL
PER SIDDHARTHA NAUTIYAL, JM:
This appeal has been filed by the assessee against the order passed by the Ld. Commissioner of Income Tax(Appeals)-2 (in short “Ld. CIT(A)”), Rajkot in Appeal No. CIT(A)-2/Rjt/10328/2018-19 vide order dated 09.01.2019 passed for Assessment Year 2015-16.
The assessee has taken the following grounds of appeals:-
“1. The Learned Commissioner of Income-tax (Appeals) – 2, Rajkot erred in confirming the addition of Rs. 5,62,600/- made by the assessing officer as unexplained cash deposits in bank account.
Shri Dipesh Ramjibhai Padariya vs. ITO Asst.Year –2015-16 - 2 - 2. The appellant craves leave to add, amend, alter and withdraw any ground of appeal anytime up to the hearing of this appeal.”
3. The brief facts of the case are that during the course of assessment, the Assessing Officer observed that assessee was having two bank accounts maintained with Union Bank of India, Rajkot Branch and HDFC Bank, Rajkot Branch in which the assessee had made a deposit of Rs. 4,17,000/- and Rs. 10,76,600/- respectively. However, the aforesaid bank accounts were not reflected in the books of the assessee. In response to show-cause notice issued to the assessee, the assessee submitted that the accountant of the assessee had forgotten to disclose the aforesaid bank accounts in the return of income inadvertently. The assessee submitted that the aforesaid two bank accounts were opened for his family and deposits in these accounts were from his receipt of agricultural income. In the assessment order the Assessing Officer after giving credit of the withdrawal from the same bank accounts, made an addition of Rs. 5,62,600/- in the hands of the assessee on account of bank deposits from undisclosed source.
4. In appeal Ld. CIT(A) confirmed the addition with the following observations:-
“Having considered facts and circumstances, I find that the assessee had declared total income of Rs.2,63,630/- and agriculture income of Rs.22,47,493/- in the return of income. The impugned deposit in the UBI and the HDFC bank were not reflected in the books of accounts whereas the agricultural income had been reflected in the books of accounts. Therefore the explanation of assessee that the impugned deposits were out of agriculture income receipt is devoid of merit. The Shri Dipesh Ramjibhai Padariya vs. ITO Asst.Year –2015-16 - 3 - Assessing Officer has rightly rejected the contentions of assessee that it was a mistake on part of accountant to include these two banks accounts in the books of accounts. I also find that against the total deposit of Rs. 14,93,600/- the Assessing Officer has made addition only of Rs.5,62,600/- giving the assessee set up off earlier withdrawals. In my considered opinion the Assessing Officer has been fair enough in treating only deposit of only Rs.5,62,600/- to be unexplained. The alternative contentions of assessee that the addition should be made in proportion to business income and agriculture income is also devoid of merit as impugned deposit are not proved to be related to these sources of income.
In view of the above discussion addition is confirmed and grounds of appeal are rejected. Appeal is dismissed.”
5. The assessee is in appeal before us against the aforesaid order passed by Ld. CIT(A). Before us the assessee filed written submission dated 07.02.2023, vide which it was submitted that the assessee is an agriculturist with substantial land holding of 93.75 acres of land jointly with two of his family members. The assessee declared agricultural income of Rs. 22,47,493/- from the lands held by the assessee in the return of income for the impugned assessment year. Further, the assessee had filed copies of Form 7/12, 8/A, ledger accounts of agricultural income, expenses, sale and purchase bulls before the Assessing Officer and Ld. CIT(A) in support of its contention. Further, the assessee submitted that the assessee has been regularly declaring agricultural income for various assessment years as given in the below table:-
Shri Dipesh Ramjibhai Padariya vs. ITO Asst.Year –2015-16 - 4 - A.Y. Agricultural income (Net) 2013-14 7,50,612/- 2014-15 7,20,961/- 2015-16(year in appeal) 22,47,493/- 2016-17 19,68,047/-
Therefore, the assessee submitted that the assessee has been earning agricultural income since many years and has shown the same in the returns of income filed for the respective assessment years. Further, it was submitted that the Assessing Officer and Ld. CIT(A) had not disbelieved any of the evidences filed by the assessee in support of agricultural income earned during the impugned assessment year. The Counsel for the assessee submitted that the cash deposits in impugned bank accounts were made out of agricultural income earned by the assessee, which was available as cash in hand at relevant point of time and cash in hand was duly disclosed by the assessee in the returns of income filed by him in ITR-4 for earlier and latter assessment years and for the impugned assessment year as well. Accordingly, it was submitted that there is ample supporting evidence to show the source of aforesaid deposits and aforesaid amount of Rs. 5,62,600/- cannot be added to the income of the assessee only on account of two bank accounts not being declared by the assessee in the return of income filed for the impugned assessment year, due to mistake of the accountant, more so, when the evidence in respect of agricultural income in the form of sale bills and revenue records in From 7/12 and 8A were filed before the Assessing Officer and CIT(A).
In response, Ld. D.R. relied upon the observations made by the Ld. Assessing Officer and Ld. CIT(A) in their respective orders.
Shri Dipesh Ramjibhai Padariya vs. ITO Asst.Year –2015-16 - 5 -
We have heard the rival contentions and perused the material on record. After going through the facts of the case, the submissions made by the assessee before us and the documents placed on record, we observe that the assessee has been regularly declaring agricultural income for various assessment years from A.Y. 2013-14 to A.Y. 2016-17. Further, the assessee has also shown supporting bills, ledger accounts, sale and purchase bills, detail of expenses etc. both before the Assessing Officer and Ld. CIT(A), and the aforesaid evidences have not been disputed / disbelieved by the Department. Accordingly, looking into the facts of the case, we are of the considered view that the assessee has been able to explain the source of investment in the aforesaid two bank accounts. Accordingly, the addition is directed to be deleted and the appeal of the assessee is allowed.
In the result, the appeal of the assessee is allowed.
This Order pronounced in Open Court on 04/08/2023
Sd/- Sd/- (ANNAPURNA GUPTA) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 04/08/2023 TANMAY, Sr. PS TRUE COPY आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त(अपील) / The CIT(A)- 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, राजोकट / DR, ITAT, Rajkot 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,