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2018 (9) TMI 1857 - AT - Income TaxAddition on account of agriculture income as unexplained cash credits u/s. 68 - HELD THAT - AO held that to avail production of agriculture produce shown by the assessee the expenses are quite low the assessee has not produce anything on record to establish that how he could obtain such a high yield by spending less on expenses related to agricultural income. AO also noted that no supporting evidence to support receipts on account of agricultural income or bills in support of agriculture related expenses such as fertilizers seeds, pesticides, labour etc. were submitted which again supports the allegation and stand of the AO. Before us also the ld. AR could not show us any documentary evidence supporting the fact of expending amounts on agriculture activity and for procurement of agriculture crop therefore, the appellant could not negate the allegations and contention of the AO. AR could not show us any contrary situation or facts to compel us to hold that the observations of the authorities below are not sustainable. In this situation, we are inclined to hold that the addition made by the AO and confirmed by the CIT(A) is quite justified and based on cogent reasons and we are unable to see any valid reason to interfere with the same. Hence, the conclusion drawn by the authorities below is uphold and consequently sole ground of assessee being devoid of merits is dismissed by upholding the addition - Decided against assessee Addition u/s 68 - huge cash deposit made in the bank account operated by assessee were not explained and the primary onus of proving the source were not discharged by the assessee - HELD THAT - When the impugned deposits have been considered in the hands of respective account holders for making additions u/s. 68 of the Act then, the same amount cannot be added to the income of the assessee in the same AY 2011-12 on the same allegations and thus, we are inclined to hold that the ld. CIT(A) was right in deleting the entire amount of addition made by the AO u/s. 68 of the Act. Therefore, we are unable to see any ambiguity, perversity or any other valid reason to interfere with the conclusion drawn by the ld. CIT(A) and hence, we uphold the same. Addition u/s 69 - HELD THAT - Neither the AO nor the DR has controverted the fact that the addition has been made by the AO by treating the amount deposited to the bank account owned by the assessees brother Shri Samir Kumar as income of the assessee. In fact, the amount of ₹ 8,64,267/- was representing the maturity value of insurance policy of M/s. Bajaj Alliance Insurance standing in the name of appellant s brother Shri Samir Kumar therefore, the same was deposited to the account of assessee s brother and such amount cannot be treated as unexplained income of the assessee u/s. 69 of the Act thus, the CIT(A) was right in deleting the addition. Addition on account of unaccounted bank interest which was not shown in the computation of income - HELD THAT - When the accounts were opened in the names of family members of the assessee and assessee was power of attorney to operate these accounts and the AO could not bring any material on record to show that the assessee was real owner and beneficiary of these accounts and the cash deposits made therein were in fact amounts belonging to the assessee then, the interest earned in such accounts cannot be treated as income in the hands of the assessee. - Decided in favour of assessee.
Issues Involved:
1. Addition of ?2,05,540/- as unexplained cash credits under Section 68 of the Income Tax Act, 1961. 2. Deletion of addition of ?2,76,97,000/- under Section 69 of the Income Tax Act, 1961. 3. Deletion of addition of ?8,64,267/- under Section 69 of the Income Tax Act, 1961. 4. Deletion of addition of unaccounted bank interest of ?1,16,579/- under Section 69 of the Income Tax Act, 1961. Issue-wise Detailed Analysis: 1. Addition of ?2,05,540/- as unexplained cash credits under Section 68: The Assessee contended that the addition of ?2,05,540/- made by the Assessing Officer (AO) on account of agricultural income as unexplained cash credits under Section 68 of the Income Tax Act, 1961, was unjustified. The Assessee argued that the income was derived from agricultural activities on owned land and was thus exempt. However, the AO noted that the Assessee could not substantiate the agricultural expenses with supporting evidence such as bills for fertilizers, seeds, pesticides, and labor. The Commissioner of Income Tax (Appeals) [CIT(A)] upheld the AO's addition, citing discrepancies in the agricultural income and expenses reported by the Assessee. The Tribunal concluded that the addition was justified as the Assessee failed to provide adequate evidence to support the claimed agricultural income and expenses. 2. Deletion of addition of ?2,76,97,000/- under Section 69: The Revenue appealed against the CIT(A)'s deletion of ?2,76,97,000/- added by the AO under Section 69 for unexplained cash deposits in bank accounts operated by the Assessee. The AO argued that the Assessee failed to explain the source of these deposits. The CIT(A) found that the Assessee was merely a mandate holder for the bank accounts in question, which were owned by family members. The Tribunal upheld the CIT(A)'s decision, noting that the AO did not provide evidence to prove that the Assessee was the real owner of the accounts. Furthermore, it was established that the same deposits had already been taxed in the hands of the respective account holders, thereby preventing double taxation. 3. Deletion of addition of ?8,64,267/- under Section 69: The Revenue challenged the CIT(A)'s deletion of ?8,64,267/- under Section 69, which represented the maturity value of an insurance policy deposited in the bank account of the Assessee's brother. The Tribunal agreed with the CIT(A) that the amount belonged to the Assessee's brother and not the Assessee. Therefore, the addition was rightly deleted as the amount could not be treated as the Assessee's unexplained income. 4. Deletion of addition of unaccounted bank interest of ?1,16,579/- under Section 69: The Revenue also contested the deletion of ?1,16,579/- added by the AO as unaccounted bank interest. The CIT(A) held that since the bank accounts were not owned by the Assessee, the interest earned could not be considered the Assessee's income. The Tribunal upheld this view, stating that the interest income from accounts operated by the Assessee as a mandate holder could not be attributed to him without evidence proving his ownership of the accounts. Conclusion: The Tribunal dismissed both the Assessee's and the Revenue's appeals, maintaining the CIT(A)'s decisions on all counts. The additions made by the AO were either upheld or deleted based on the evidence and explanations provided, ensuring that the income was correctly attributed to the rightful owners and preventing double taxation.
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