9911796707
TMI Blog2017 (7) TMI 607X X X X Extracts X X X X X X X X Extracts X X X X ..... arnail Singh (Karta) (2008 (5) TMI 280 - PUNJAB AND HARYANA HIGH COURT) clearly applies in favour of the assessee. This fact is further strengthened by the fact that even in earlier years, assessee has shown the agriculture income. Therefore, there is no question of assessee earning any 'income from other sources' other than the agriculture income. - Decided in favour of assessee. - ITA No. 459/CHD/2016 - - - Dated:- 29-11-2016 - SHRI BHAVNESH SAINI, JUDICIAL MEMBER For The Appellant : Shri Rohit Goel For The Respondent : Shri S.K.Mittal, DR ORDER This appeal by assessee has been directed against the order of ld. CIT(Appeals)-2 Gurgaon dated 18.02.2016 for assessment year 2012-13, challenging the addition of ₹ 18 lacs under section 68 of the Income Tax Act out of agriculture land income holding the same as 'income from other sources'. 2. Brief facts of the case are that return declaring income of ₹ 2,457/- was filed on 29/03/2013. The assessee had also shown agricultural income of ₹ 23,21,222/-details of which are as under:- Particulars Amount (In Rupees) Agricultural In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) The AO further, referred to the assessee's claim that Safeda Trees had been sold to Sh. Tarwar and Sh. Sarwan Kumar and pointed out that it was claimed that the sale price was received in cash. The AO issued summons u/s 131 to both these persons for verifying the genuineness of transaction and receipt of sale consideration of ₹ 20,00,000/-. Summons issued to Sh. Tarwar was received back with remarks wrong address. There was no compliance in other case also. The AO accordingly asked the assessee to produce both these persons for examination to verify the genuineness of transaction of the cash receipt. In-spite of repeated opportunities, the assessee failed to produce these persons and vide reply dated 16/10/014 submitted that the persons to whom Safeda Trees had been sold could not be produced for verification as he was not a local resident. The AO held that the assessee had failed to establish that the income of ₹ 18,00,000/- declared in the return of income was earned by him through sale of trees and accordingly added the same as his income from other sources. 4. The assessee challenged the addition before ld. CIT(Appeals) and written submission of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts of the case. As regard to gardawari of the double plantation on the outer boundaries which have not been recorded by the patwari in the gardawari, it is respectfully submitted that at the time of plantation, two rows of plants can easily be planted on boundaries and revenue authority shall not record the plantation at the time of gardwari due to the reason that Safeda is planted only on the boundaries and not in the field and in coming years the practice goes of not recording the trees. A certificate from Halka Patwari stating that safeda planted on boundaries of the field are not recorded in the Gardawari( Revenue Record) has been furnished during the Assessment proceedings. Thus A. O's version is wrong and against the facts of the case. Learned A. O's observations vide Page 4 of order are as under:- The Assessee vide reply dated 30.12.2014 has claimed that 1631 Safeda Trees, which have been sold, were planted on boundaries of three fields involving total area 16.5 Acres and circumference of 9940 Feet, as per details hereunder : Khasra No. Boundaries/Circumference Khasra No. 51 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 87*4=348 fts. In View of the above, Learned A. O. 's calculations are not only wrong but the result derived out of it are misleading. Learned A.O's Observations vide Page 5 of order are as under:- The Assessee has claimed to sold these safeda trees to Sh. Tarwar, s/o Sh. Tanu Husan, Vill. Mirjapur poll, Distt. Saharanpur(U.P) and Sh. Sarwan Kumar, s/o Sh. Rajpal, vill. Mirgarh, Tehsil Behat, Distt. Saharanpur(U.P). However, despite allowing number of opportunities to Assessee could not be able to produce both the persons for verification and examining. He vide reply dated 16.10.2014 categorically denied that persons to whom safeda has been sold cannot be produced for verification as he was not a local resident. The Assessee's submission is as under:- The purchaser of the safeda trees are a group of laborers of a particular area who joins hands for doing collective labour and enter into a contract for standing trees. They collectively cut it down and carry the same for sales. They use to take the funds from the Commission agents to whom they sell the timber wood. After selling it out they use to distribute the profit which is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this regard, the appellant has failed to satisfactorily explain through circumstantial evidence also that he had earned agricultural income of ₹ 18 lakhs on account of sale of Safeda Trees. The AO has clearly pointed out that as claimed by the appellant, if the trees were grown in double raw in a part of Khasra No. 51 then the inner raw would have been a part of the Girdawari report. The appellant has not been able to explain this discrepancy pointed out by the AO. Further, the appellant has also failed to provide any evidence with regard to the receipt of sale proceed amounting to ₹ 20 lakhs. Although, the Safeda Trees were claimed to have been sold to two persons namely Sh. Tarwar and Sh. Sarwan Kumar, both of Saharanpur, these persons failed to appear in response to the summons issued by the AO (In one case, even the address as provided by the appellant was wrong address) nor were they produced by the appellant in support of its claim in-spite of repeated opportunities. In these circumstances, the claim of cash receipt on account of sale of Safeda Trees remains unverified. The onus lies on the appellant to furnish evidence with regard to the claim of agricultural i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any basis. Since assessee has only agriculture income and there is no material on record to show any vested interest or motive with the assessee to declare agriculture income higher than the actual amount, therefore, addition is wholly unjustified. In support of his contention, he has relied upon decision of Hon'ble Punjab Haryana High Court in the case of CIT, Chandigarh-2 V Kartar Singh, Karta reported in 316 ITR 160. 6(i) On the other hand, ld. DR relied upon orders of the authorities below. 7. I have considered rival submissions. It is not in dispute that assessee is having sufficient land holding to earn agriculture income. The assessee produced J-Form for sale of agriculture produce which has not been disputed by authorities below in accepting the agriculture income. It is also clear from the record that he has declared agriculture income in past also. It is, therefore, proved that assessee is being engaged in activity yielding agriculture income in past as well as during the assessment year under appeal. The dispute is with regard to sale of safeda trees by the assessee which have been sown on boundaries of the agriculture field. The authorities below rejected the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... verse inference could be drawn against the assessee. The assessee filed affidavit of Shri Ram Prashad, Numbardar of the village who has also confirmed that assessee has sown safeda trees on the boundary of about 18 acres of land and out of which, some of the area was sown in double row. This fact is confirmed by three neighbourers in their affidavits of the same village who have land adjoining to the land of the assessee. These affidavits were filed before ld. CIT(Appeals), therefore, if ld. CIT(Appeals) was having any doubt on the same, he could have remanded the matter to the Assessing Officer at appellate stage for getting the facts confirmed from the neighbourers and Numbardar of the village. Therefore, such a circumstance would not be adverse in nature against the assessee. 7(ii) The ld. counsel for the assessee relied upon decision of the Hon'ble Punjab Haryana High Court in the case of CIT Vs Jarnail Singh (Karta) (supra) in which it was held as under : The Revenue has filed the present appeal under section 260A of the Income tax Act, 1961 (hereinafter referred to as the Act ), against the order dated August 21, 2007, passed by the Income tax Appellate Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e gross sale realisation the expenses to the extent of 25 per cent. This manner of declaring agricultural income itself shows that it has been declared on estimate basis. Now, the issue is as to whether the estimate made by the assessee can be construed as reasonable considering the claim of agricultural operations carried out, size of land holdings, past history, etc. In this context, we find that the assessee has attempted to explain that it had 36 acres of land under cultivation, partly owned by him and partly belonging to his brother in addition to 6 acres of land taken on lease. The Assessing Officer did not accept the plea of the assessee with respect to the leased land for the reason that it was not substantiated. In so far as the non-acceptance of the quantum of agricultural income is concerned, the Assessing Officer referred to a journal of Haryana Agricultural University to deduce as to what should be per acre yield from the land owned by the assessee. On that basis, he held that the yield declared by the assessee was high. In my considered opinion the approach of the Assessing Officer was manifested by the reason that in the absence of the books of account, the agricultu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee. Ms. Urvashi Dhugga, learned counsel for the Revenue, has argued that the agricultural income declared by the assessee was on an estimate basis and the same was on the higher side considering the yield available from the land in question and, therefore, the findings of the Tribunal are perverse and are based upon conjectures and surmises and the findings of the Assessing Officer as well as the Commissioner of Income-tax (Appeals) have been ignored without any written material on record. We have heard learned counsel for the Revenue and perused the record. We find no merit in the contention raised by counsel for the Revenue appellant. The Tribunal has given a pure finding of fact after considering the evidence on record with regard to the agricultural income of the assessee. We find that the approach adopted by the Assessing Officer, by not relying upon the material produced by the assessee in support of the estimation of income is wrong, because there is no finding that the material sought to be relied upon by the assessee was lacking in credibility. The certificate of average income per acre of land issued by the Village Patwari indicates the income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but authorities below have failed to point out as to what income is earned by assessee from other sources because assessee has no other source of income except the agriculture income. The interest is from specified source and ascertained. Therefore, in the absence of any material on record that what is the other income of the assessee except that of agriculture income, I am of the view the decision in the case of Shri Jarnail Singh (Karta) (supra) clearly applies in favour of the assessee. This fact is further strengthened by the fact that even in earlier years, assessee has shown the agriculture income. Therefore, there is no question of assessee earning any 'income from other sources' other than the agriculture income. 9. Considering the totality of the facts and circumstances, explanation of the assessee and material on record, I am of the view addition of ₹ 18 lacs is wholly unjustified treating the agriculture income as 'income from other sources'. I, therefore, set aside the orders of authorities below and delete the addition of ₹ 18 lacs. 10. In the result, appeal of the assessee is allowed. Order pronounced in the Open Court. - - ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
