2011 (9) TMI 1024 - AT - Income Tax

Summary

Issues involved: Appeals against orders of Commissioner of Income-tax(Appeals) by two assessees, treating agricultural incomes as 'income from other sources' and charging of interest under S.234A, 234B, and 234C.

Treatment of Agricultural Incomes:
The main issue in the appeals was the assessing officer's treatment of agricultural incomes as 'income from other sources'. The assessees had consistently declared agricultural incomes in their returns, supported by documents such as land purchase deeds and pattadar passbooks. The assessees established that the agricultural lands had irrigation facilities and income estimation was conservative. The Tribunal noted that the assessees' declared incomes were reasonable considering their land holdings. The Revenue failed to dispute ownership of the lands or the existence of irrigation facilities. The Tribunal held that the assessees had provided sufficient evidence to support their declared agricultural incomes and rejected the Revenue's argument that lack of detailed expenditure evidence meant the incomes should be treated as 'income from other sources'. The Tribunal concluded that the agricultural incomes declared by the assessees were genuine and not to be assessed under a different category.

Charging of Interest under S.234A, 234B, and 234C:
The second common issue in the appeals was the charging of interest under S.234A, 234B, and 234C. The assessees contended that the Assessing Officer should have calculated the interest correctly. The Tribunal, considering this issue as consequential in nature, directed accordingly.

Conclusion:
The Tribunal partly allowed all eleven appeals of the assessees, ruling in their favor on the treatment of agricultural incomes and directing the correct calculation of interest under S.234A, 234B, and 234C. The orders were pronounced on 16.9.2011.