2022 (2) TMI 431 - AT - Income Tax

Addition made u/s. 68 - Addition of agricultural income - admission of additional evidences - HELD THAT - The assessee has furnished additional evidences to prove that the hand land balance of ₹ 23 lakhs represents balance brought forward from earlier year and also copies of land holding and crop certificate in support of the claim of agricultural income. In the interest of natural justice, these evidences should be admitted and the matters may be restored to the file of the A.O. for examining both the issues afresh. There should not be any dispute that the admission of additional evidences filed in support of the claim made in the return of income would promote the cause of justice. Accordingly, admit the additional evidences furnished by the assessee. Since both the issues required to be examined afresh duly considering the additional evidences furnished by the assessee,we set aside the order passed by Ld. CIT(A) on both the issues and restore them to the file of AO for examining them afresh. Appeal filed by the assessee is allowed for statistical purposes

Summary

Issues:
Appeal barred by limitation, condonation of delay, addition u/s. 68 of the Act, addition of agricultural income.

Analysis:
The judgment pertains to an appeal challenging an order passed by the Ld. CIT(A)-3, Bengaluru for the assessment year 2016-17. The appeal was initially barred by a delay of 595 days, prompting the assessee to file a petition requesting the condonation of the delay. The delay was attributed to collating necessary documents and the onset of the Pandemic. The Tribunal, after hearing both parties, condoned the delay and admitted the appeal for hearing.

The issues contested in the appeal involved two main additions. Firstly, the addition made under section 68 of the Act amounting to ?23,00,000. The Assessing Officer (A.O.) treated this as unexplained cash credit due to the absence of details provided by the assessee. Secondly, an addition of agricultural income amounting to ?7,33,044 was made as the assessee failed to furnish supporting evidence. Both additions were confirmed by the Ld. CIT(A), leading to the appeal before the Tribunal.

Regarding the cash credit addition, the assessee contended that the amount was an opening balance carried forward from the previous year. The Ld. A.R. argued that the total cash deposits into the assessee's bank account were significantly less than the disputed amount, supporting the claim that the balance was not received during the current year. The Tribunal allowed the admission of additional documents and decided to restore the matter to the A.O. for re-examination.

Concerning the addition of agricultural income, the assessee submitted additional evidence, including land holding and crop certificates, to substantiate the claim. The Tribunal, in the interest of justice, admitted these documents and directed the issue to be re-examined by the A.O. to ensure a fair assessment.

After considering the arguments from both sides and the additional evidence provided by the assessee, the Tribunal set aside the Ld. CIT(A)'s order on both issues and remanded them to the A.O. for fresh examination. The A.O. was instructed to provide the assessee with a fair opportunity to present their case before making a decision in accordance with the law.

In conclusion, the appeal filed by the assessee was allowed for statistical purposes, and the order was pronounced in the open court on 1st Feb., 2022.