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Income Tax Appellate Tribunal, SURAT BENCH, SURAT
Before: SHRI PAWAN SINGH, JM & DR. A. L. SAINI, AM
आदेश / ORDER PER DR. A. L. SAINI, AM: Captioned appeal filed by assessee, pertaining to Assessment Year (AY) 2017-18, is directed against the order passed by the Learned Commissioner of Income Tax (Appeals), (in short “ld. CIT(A)”], National Faceless Appeal Centre (NFAC), Delhi in Appeal No. ITBA/NFAC/S/250/2020-21/1031406106(1), dated 11.03.2021 which in turn arises out of an assessment order passed by the Assessing Officer under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) dated 11.12.2019.
Grounds of appeal raised by the assessee are as follows: “1. On the facts and circumstances of the case as well as law on the subject, the assessing officer has erred in making addition of Rs.8,04,078/- on account of unexplained cash credit u/s 68 of the I.T. Act, 1961. 2. On the facts and circumstances of the case as well as well on the subject, the assessing officer has erred in taxing the income u/s 115BBE @77.25% in a retroactive manner by applying the duly substituted S. 115BBE inserted retrospectively instead of taxing it at 35.54% as per old provisions of S.115BBE. 3. It is therefore prayed that addition made by assessing officer and confirmed by CIT(A) may please be deleted.
ITA.20/SRT/2021/AY.2017-18 Kamlaben Thakorbhai Patel 4. Assessee craves leave to add, alter of delete any ground(s) either before or in the course of hearing of the appeal.”
3.Succinct facts are that assessee before us is an individual and has filed her return of income for the year under consideration on 27.03.2018, declaring total income of Rs.1,98,760/-. The said return of income was processed under section 143(1) of the Income Tax Act accepting the return income. Later on, assessee’s case has been selected for scrutiny on the issue of cash deposit in bank account. During the assessment proceedings, the assessee was asked to explain the source of cash deposit. In response, assessee submitted that he has deposited the amount out of agricultural income and past saving from agricultural. In support of agriculture income, the assessee has furnished an agreement made on 6.3.2017 between assessee and (i) Ramlal Jagnath, Sitholi Ashik and (ii) Mohd. Wasim Mo. Asgar, The assessee also furnished confirmation and Land records. However, the assessing officer rejected the contention of the assessee and held that during the course of assessment proceedings, the assessee failed to adduce cogent documentary evidence to explain source of cash deposited in her bank account, therefore assessing officer made addition to the tune of Rs.8,04,078/- under section 68 of the Act. 4. Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before ld. CIT(A) who has confirmed the action of the assessing officer. Aggrieved, the assessee is in further appeal before us. 5. Shri Mehul Shah, Learned Counsel for the assessee pleads that assessee is an agriculturist and does not have any income except agricultural income. The Assessing Officer has not disallowed the entire agricultural income of the assessee only a part of the agricultural income was disallowed. It means, ld CIT(A) has accepted that assessee is engaged in the agricultural activities. The assessee has deposited cash in the bank account during the demonetization scheme from the past saving of agricultural activities. The Ld. Counsel stated that assessee has sold the mangos to the tune of Rs.90,21,000/-. The ld Counsel also submitted that assessee is owner of land, vide paper book at page no.15. The Assessee also submitted
ITA.20/SRT/2021/AY.2017-18 Kamlaben Thakorbhai Patel confirmation to whom agricultural products were hold. The assessee has submitted the confirmation dated 04.12.2019 in response to the notice dated 07.12.2019, however the Assessing Officer has not considered the same and did not conduct further enquiry about the confirmations submitted by assessee,(vide paper book page no.81). Therefore, Ld. Counsel for the assessee contended that addition made by the Assessing Officer may be deleted.
On the other hand, Learned Departmental Representative (ld. DR) for the Revenue submitted that after getting the notice from the Assessing Officer, the assessee has filed the income tax return showing agricultural income, which shows mala-fide intention of the assessee. The Ld.DR further pointed out that agreement between the assessee and the person to whom mangoes were sold is an afterthought of the assessee. Therefore, ld DR pleads that Assessing Officer has rightly made the addition under section 68 of the Act, and the same may be confirmed.
We have heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld CIT(A) and other materials brought on record. We note that ground of appeal raised by the assessee relates to addition Rs.8,04,078/- on account of cash deposit. We note that assessee`s return of income has been selected for scrutiny assessment u/s 143(3) of the Act. During the assessment proceedings it has been noted by the Assessing Officer that following cash deposits in the year under consideration has been made by the assessee.
Sr. Name and A/c No. Cash deposited during Cash deposited No. Address of Bank the demonetization other than period i.e. between 09- demonetization 11-2016 to 31-12-2016 period 1 Bank of Baroda, 17170100002953 1,00,000 15,71,000 Vanzana, Chikhli 2 Bank of Baroda, 17170600001119 7,04,078 Vanzana, Chikhli TOTAL 8,04,078 15,71,000
ITA.20/SRT/2021/AY.2017-18 Kamlaben Thakorbhai Patel We note that out of total cash deposit in bank of Rs. 15,71,000/-, the Assessing Officer disputed only Rs.8,04,078/- and made addition under section 68 of the Act. The balance amount of cash deposit in bank of Rs.7,66,922/- (Rs. 15,71,000 - Rs.8,04,078) has not been disputed by assessing officer and therefore assessing officer has treated Rs.7,66,922/- as genuine agricultural receipts deposited in the bank account. Hence, we note that Assessing Officer has picked only Rs.8,04,078/- out of total cash deposit of Rs. 15,71,000/- and stated that sum of Rs.8,04,078/- is not out of agricultural receipts, whereas ld Counsel submitted that total amount of Rs. 15,71,000/- was deposited out of sale of agricultural produce. We note that before the Assessing Officer, assessee submitted proof of agricultural land. For justification of agricultural income, an agreement dated 06-03-2017 made between the assessee and (i) Sri Ramlal Jagnath, Sitholi Achik, and (ii) Md. Wasim Mo Asgar, has been submitted. (iii) Confirmation of accounts for mango Karar dated 06.03.2017, was submitted, which is placed at paper book page no.2. The Ld. Counsel also submitted copy of Form 8A and 7/12 proof of land-holding which is paced at paper book page nos. 5 to 12. The assessee also submitted photos of Ambawadi, which is placed at paper book page no.22. The ld. Counsel submitted bank statement of A/c. No.1119, which is placed at paper book page nos. 62 to 63. The Ld Counsel submitted the bank A/c. No.02953 which is placed at paper book page nos.64 to 67. The assessee also submitted the copy of Acknowledgement of return of income for AY.2018-19 which is placed at paper book page no. 68 and contended the department has accepted the agricultural income in the subsequent year, that is, in assessment year 2018-19.
From the above factual position, we note that assessee is an agriculturalist and assessee does not have any other income except agricultural income, therefore whatever the cash deposited into the bank account is out of agricultural income. We note that Hon'ble jurisdictional High Court of Gujarat in the case of ITO vs. Aswin D. Mehta (HUF), Tax Appeal No.386 of 2000, dated 03.12.2014, held that since the agricultural income has been accepted by the revenue and the AO has not been able to prove any other source of income out of which the assessee could have
ITA.20/SRT/2021/AY.2017-18 Kamlaben Thakorbhai Patel earned this income and the income declared by the assessee has to be accepted. The Findings of the Hon'ble Court are reproduced below: “6. We have heard learned advocates for the parties and perused the records. The CIT(A) has observed that the assessee has given complete details about the income and also shown agricultural income in the books of accounts though the returns were not filed because the assessee was not having any income other than agricultural income. The CIT(A) has held that since the agricultural income has been accepted by the revenue and the AO has not been able to prove any other source of income out of which the assessee could have earned this income and the income declared by the assessee has to be accepted. 6.1 The Tribunal has upheld the view taken by the CIT(A) and observed further in para 7 that it cannot be said that there has been any violation of Rule 46A of I.T. Rules as alleged by the learned DR while arguing his case. The Tribunal has observed that out of about 15000 saplings of Eucalyptus trees/Nilgiri trees which were planted in 1982-83, it is quite reasonable to assume that atleast 5000 saplings of Eucalyptus trees/Nilgiri trees will grow into full trees in the year 1990-91 relating to AY 1991-92 which could be cut and sold because as per the certificate issued by the Range Forest Officer no permission is required for cutting and sale of Eucalyptus trees/Nilgiri trees. 6.2 In view of the aforesaid, we are of the opinion that the Tribunal as well as CIT(A) are justified in coming to the conclusion that there is no merit in the appeals filed by the Revenue. The assessee HUG owns fertile agricultural land having irrigation facilities from which agricultural income has been shown and accepted by the revenue in earlier years also and the fact of assessee having been allotted agricultural land and 15000 Eucalyptus trees/Nilgiri trees in the year 1982-83 has been certified by Range Forest Officer. We are in complete agreement with the reasonings adopted and findings of fact arrived at by the lower authorities. 7. We, therefore, answer the questions raised in the present appeals in favour of the assessee and against the department - revenue. Appeals are dismissed accordingly.”
We note that assessee is a farmer and carries on agricultural activities. During the assessment proceedings the assessee has filed all the details and documents. The assessing officer did not find any defect in the documents and details submitted by assessee. It is also clear that assessee is not engaged in any other activity except agricultural activity and the Assessing Officer has not brought any material on record to prove that assessee was engaged into any other activity apart from
ITA.20/SRT/2021/AY.2017-18 Kamlaben Thakorbhai Patel agricultural activity, which can generate unaccounted income. The assessee is an agriculturist and AO has not pinpointed any other source of income from whom assessee has earned income. For that reliance can be placed on the decision of the Hon’ble Bombay High Court in the case of RBNJ Naidu v. CIT 29 ITR 194 (Nag) wherein it was held that “when an assessee denies that he is in receipt of income from a particular source, it is for the ITO to prove that the assessee received income and that the assessee cannot prove the negative”. Reliance is also placed on the decision of the Hon’ble ITAT, Ahmedabad in the case of Gopalbhai V. Bhoiwala Vs. ITO [ITA No. 3008/Ahd/2009] wherein it was held that: ....”Since the assessee has only agricultural income and the assessing officer has not brought any evidence on record that assessee has income from other sources also, therefore, there is no reason to sustain the orders of the authorities below. We accordingly set aside the orders of the authorities below and delete the addition of Rs. 1,50,000/-”.
From the above facts of the case, and applicable precedents on facts, it is vivid that assessee is an agriculturalist and assessee does not have any other income except agricultural income. At the cost of repetition, we state that assessee submitted an agreement dated 06-03-2017 made between the assessee and Sri Ramlal Jagnath, Sitholi Achik, Confirmation of accounts for mango Karar dated 06.03.2017, copy of Form 8A and 7/12 for proof of land-holding, photos of Ambawadi, bank statement of A/c. No.1119, bank statement for A/c. No.02953, and copy of return of income for AY.2018-19 wherein department has accepted the agricultural income in the subsequent assessment year 2018-19. The assessing officer did not find any fault in these documents. Hence, we are not inclined to accept the contention of the Assessing Officer in any manner and hence the addition so made is deleted. Hence this ground of the assessee is allowed.
11.In the result, appeal filed by assessee is allowed.
ITA.20/SRT/2021/AY.2017-18 Kamlaben Thakorbhai Patel
Order is pronounced in the open court on 30/06/2022 by placing the result on the Notice Board as per Rule 34(5) of the Income Tax (Appellate Tribunal) Rule 1963.
Sd/- Sd/- (PAWAN SINGH) (Dr. A.L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER Surat �दनांक/ Date: 30/06/2022 SAMANTA Copy of the Order forwarded to 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, Surat 6. Guard File By Order // True Copy // Assistant Registrar/Sr. PS/PS ITAT, Surat