2021 (9) TMI 351 - AT - Income Tax

Disallowance on account of agriculture income - as per AO no proof of agricultural operation including purchase of inputs, sale of output and bills/vouchers for operational expenses provided by assessee - HELD THAT - CIT(A) in the impugned order observed that no evidence for cultivation of the land, irrigation facilities, purchase of inputs etc. have been produced in the First Appellate Authority - As rightly pointed by the ld. DR and also emanating from the record that no evidences in support of claim were furnished in all the authorities including this Tribunal, therefore, we find no infirmity in the order of CIT(A) and it justified. Thus, the ground No. 1 raised by the assessee is dismissed. Addition made on account of Sundry Creditors - addition made as no evidence supporting the claim of assessee give - HELD THAT - AO having confirmed the details of other parties in the books of account only sought information regarding the two parties. The assessee, however, failed to give the details as sought by the AO in the assessment proceedings and no evidences even filed before the CIT(A) in First Appellate proceedings and as rightly contended by the ld. DR no evidence before this Tribunal supporting the claim of assessee in respect of the addition made on sundry creditors. Therefore, we agree with the finding of CIT(A) - Decided against assessee.

Summary

Issues:
1. Challenge against the restriction of disallowance on agriculture income.
2. Challenge against the confirmation of addition made on account of Sundry Creditors.

Analysis:

Issue 1: Challenge against the restriction of disallowance on agriculture income

The appeal was filed by the assessee against the order of the Commissioner of Income Tax (Appeals) for the assessment year 2009-10. The assessee failed to appear, leading to the proceedings being conducted ex-parte. The primary contention raised by the assessee was against the action of the CIT(A) in limiting the disallowance on account of agriculture income. The AO had asked for detailed evidence regarding agricultural operations, but the assessee could not provide substantial proof beyond photocopies of certain documents. The CIT(A) allowed a partial deduction based on limited evidence presented. The Tribunal noted the absence of supporting evidence throughout the proceedings, leading to the dismissal of the appeal.

Issue 2: Challenge against the confirmation of addition made on account of Sundry Creditors

The second ground of challenge pertained to the confirmation of additions made on account of Sundry Creditors. The AO found discrepancies in the confirmation of trade creditors related to two parties. Despite multiple opportunities, the assessee failed to provide necessary details such as addresses and PAN numbers for verification. The CIT(A) upheld the addition due to the lack of concrete evidence from the assessee. The Tribunal concurred with the findings, emphasizing the failure of the assessee to substantiate the transactions with the concerned parties. The absence of supporting documentation at various stages of the proceedings led to the dismissal of this ground of appeal.

In conclusion, the Tribunal upheld the orders of the CIT(A) regarding both the restriction of disallowance on agriculture income and the confirmation of additions on Sundry Creditors. The appeal of the assessee was ultimately dismissed, with the Tribunal finding no merit in the challenges raised.

This summary provides a detailed analysis of the legal judgment, addressing the issues raised by the assessee and the subsequent decisions made by the authorities and the Tribunal.