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Income Tax Appellate Tribunal, SURAT BENCH, SURAT
Before: SHRI PAWAN SINGH, JM & DR. A. L. SAINI, AM
आदेश / O R D E R PER DR. A. L. SAINI, AM: Captioned appeal filed by the assessee, pertaining to Assessment Year (AY) 2011-12, is directed against the order passed by the Learned Commissioner of Income Tax (Appeals), Valsad [in short “the ld. CIT(A)”] in Appeal No. CIT(A)/VLS/620/17-18, dated 29.04.2019, which in turn arises out of an assessment order passed by the Assessing Officer under section 143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) dated 22.11.2017.
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 learned CIT(A) has erred in confirming the action of Assessing Officer in reopening the assessment u/s 147 after issuing notice u/s 148 of the Act and passing the reassessment order which is bad in law. 2. On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in partly confirming the action of Assessing Officer by sustaining the addition of Rs.6,57,417/- out of total addition of Rs.9,08,500/- on account of unexplained cash deposits. 3. On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in confirming the action of assessing officer in not
ITA No.309 /SRT/2019 Assessment Year.2011-12 Harshadray M. Vashi allowing the statutory deduction available to assessee u/s. 80C and 80D of the Act. 4. It is therefore prayed that assessment framed u/s 143(3) r.w.s 147 of the Act may kindly be quashed and/or addition made by assessing officer may please be deleted. 5. Appellant craves leave to add, alter or delete any grounds(s) either before or in the course of hearing of the appeal.”
Succinct facts are that assessee before us is a Super Senior Citizen, aged more than 80 years and solely depend on agricultural. On verification of the AIR information, the assessing officer observed that assessee has made total investment amounting to Rs.5,00,000/- in various mutual funds during the relevant financial year. Further, it was observed that assessee has not filed his return of income for assessment year 2011-12. Hence, assessing officer has reason to believe that income of Rs.5,00,000/- as stated above has escaped assessment within the meaning of section 147 of the Income Tax Act. Accordingly notice u/s 148 of the I.T. Act, 1961 was issued on 27/03/2017 after recording reason for re-opening. In response to this notice, the assessee has filed his return of income on 26/09/2017 declaring total income at Rs.1,35,840/- for the year under consideration. 4. After affording full and adequate opportunities to the assessee, the assessment proceedings have been completed on the basis of submissions filed by the assessee. Further, on verification of bank details submitted by the assessee, it was observed that assessee has deposited total cash amounting to Rs.9,08,500/- on various date in his saving bank account no. 0205-R92428-001 held with INDUSIND Bank. As the assessee did not submit reply therefore assessing officer made addition to the tune of Rs.9,08,500/- as unexplained investment. 5. Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the ld. CIT(A) who has reduced the addition by Rs. 2,51,083/- and restricted the addition to Rs.6,57,417/- (Rs.9,08,500 - Rs.2,51,083). Aggrieved, the assessee is in appeal before us.
ITA No.309 /SRT/2019 Assessment Year.2011-12 Harshadray M. Vashi 6. Shri Mehul Shah, Learned Counsel pleads that assessee submitted certificate from Shree Maroli Vibhag Khand Udyog Sahkari Mandli Ltd & from Shree Maroli Bazar Vibhag vividh Karyakari Sahkari Mandli Ltd regarding sale of agricultural produce during the year or in earlier year and also submitted copy of 7/12 of block no. 50 and 248 as additional evidence during appellate proceeding. He further submitted that during the appellate proceedings, the ld CIT(A) obtained the remand report and the said remand report does not say that assessee is not an Agriculturist. The ld Counsel further submits that assessee does not have income except from agriculture. Therefore, ld Counsel prays the Bench that addition of Rs.6,57,417/- sustained by ld CIT(A) may be deleted.
On the other hand, the Ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. 8. 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. Before us, ld Counsel submitted certificate from Shree Maroli Vibhag Khand Udyog Sahkari Mandli Ltd and from Shree Maroli Bazar Vibhag vividh Karyakari Sahkari Mandli Ltd regarding sale of agricultural produce during the year or in earlier year and also submitted copy of 7/12 of block no. 50 and 248 of the land. The Learned Counsel pleads that assessee is an agriculturist, he does not have any other income, other than from agricultural sources, therefore the assumption that assessee has deposited the money in the bank account out of other sources, is not justified. In fact the assessee has deposited the amount in bank account out of the agricultural income only. Learned Counsel submits that assessee has sufficient land holding and considering the land holding the addition should not be made. 9. It is not disputed that assessee is not an agriculturist. Before us, the Ld. Counsel submitted the land holding 7/12 extracted which placed at paper book page no. 17 and 18. From the land holding details, it is proved that land is an
ITA No.309 /SRT/2019 Assessment Year.2011-12 Harshadray M. Vashi agricultural land and Chekku, Banana and other fruits are grown by the assessee on the said land. The assessee also submitted the bank statement which is placed at paper book page no.19; the assessee also submitted a certificate from Shri Maroli Vibhag Khand Udyog Sahakari Mandli Ltd. The assessee also submitted the certificate of Shree Mandali Bazar Vibhag Vividh Karyakari Sahakari Mandli Ltd. wherein it is mentioned that assessee is a member of Shree Maroli Bazar Vibhag Vividh Karyakari Sahakari Mandli Ltd. and contributing the growth of paddy etc. Therefore, it is evidently clear that assessee has sufficient land holding and the parties to whom the agricultural produce were sold are also confirming that assessee has sold agricultural produce. The assessee has also sold Sugar Cane (agricultural produce), hence it is evidently clear that assessee being a farmer does not have any income other than agricultural income. We note that assessee is a superior senior citizen and he is above 80 years old and solely depend on agricultural land. The Assessing Officer did not point out any other source of income other than the agricultural income in the hands of the assessee. On identical facts Ld. Counsel has also relied on the judgment of the Hon'ble Gujarat High Court in the case of Aswin D. Mehta in Tax Appeal No.386 to 390 of 2000 wherein it was held as follows:
“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 at least 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
ITA No.309 /SRT/2019 Assessment Year.2011-12 Harshadray M. Vashi 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 reasoning adopted and findings of fact arrived at by the lower authorities.” 10. On the identical facts, the Co-ordinate Bench of ITAT, Surat in the case of Shankarbhai Somabhai Patel (in ITA No.654/Ahd/2016 for AY.2007-08) held as follows: “4. On careful consideration of our submissions form the assessment order we observe that the AO has not controverted the fats submitted before him that the assessee is having own agricultural land and earning income from the agricultural activities. In this situation earning of exempt agricultural income cannot be denied. The ITAT, Ahmedabad in the case of Dr. Homiyar Sohrab Billimoria (supra) held that agricultural income has to be estimated on rational basis. In the present case the assessee made investment in two bonds of Rs.5 lakhs each during the period and the AO made addition of entire amount whereas the Ld. CIT(A) granted relief to the assessee and confirming the part addition by holding that source of investment of certificate no. 4006525610 remained to be satisfactorily explained and he also held that the claim of assessee that source of investment should be presume from agricultural income found to be false. In view of above noted facts we decline to accept contentions of the authorities below the assessee owns agricultural land and earning his livelihood therefrom is not in dispute, therefore, while assessee is earning agricultural income since several years then the source of impugned part investment is self-explained which cannot be denied or doubted in any manner. We may also point out that for explaining source of investment from the addition u/s 69B of the Act primary onus lies on the assessee to establish and explain the source of investment. Ian the present case, assessee established the fact that he owns agricultural land since several years and earns exempt income therefrom the onus shifts on the AO to destroy these contentions which has not been done in the present case. Therefore, part addition upheld by the Ld. CIT(A) is not sustainable and hence we deleted the same. Accordingly, ground no. 2 of the assessee is allowed.”
Based on the facts and the applicable case law on facts, as narrated above, we are not inclined to accept the contention of the ld CIT(A) in restricting the addition of Rs.6,57,417/- (Rs.9,08,500 - Rs.2,51,083), hence the addition so restricted to the tune of Rs.6,57,417/- is hereby deleted.
In the result, Ground No.2 raised by the assessee is allowed.
ITA No.309 /SRT/2019 Assessment Year.2011-12 Harshadray M. Vashi 13. Next substantive ground no. 3 relates to confirming the action of assessing officer in not allowing the statutory deduction available to assessee u/s 80C and 80D of the Act. In this regard, ld DR for the Revenue argued that matter may be remitted back to the file of the assessing officer for verification of assessee`s claim. After hearing ld Counsel for the assessee, we are of the view that assessing officer did not examine the assessee`s claim u/s 80C and 80D of the Act. Therefore, we remit this issue back to the file of the assessing officer with the direction to examine the assessee`s claim u/s 80C and 80D of the Act, and adjudicate the issue in accordance with law. Therefore, we allow ground no.3 raised by the assessee for statistical purposes.
Since we have adjudicated the assessee`s appeal on merit, therefore assessee`s ground No.1 and ground No. 4 (on technical issue of reopening u/s147/148), in the impugned assessment proceedings, do not require adjudication.
In the result, the appeal is allowed in the terms indicated above. Order is pronounced in the open court on 17/05/2022 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 lwjr /Surat �दनांक/ Date: 17/05/2022 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