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2015 (7) TMI 527 - AT - Income TaxTreatment to agricultural income as income from undisclosed sources - Held that:- The AO has not accepted the assessee’s claim of having earned any agricultural income contrary to his claim of earning of ₹ 1,90,500/-; and following suit, CIT (A) also had the same view of AO; and accordingly the Ld CIT(A) upheld the action of AO and treated ₹ 1,90,500/- claimed by assessee as agricultural income as income from undisclosed sources. The assessee is aggrieved by the said impugned order of the CIT (A). Now, as it has been held by the Tribunal in the preceding years to the instant assessment year and subsequent years that the assessee has earned agricultural income in those years and assessee’s agricultural income has to be calculated for his own land at ₹ 10,000/- per bigha and ₹ 5,000/- per bigha on land taken on lease by the assessee. The ld DR, could not bring to our notice any change in facts during the year under consideration, so in the light of the said finding and direction, following suit, we direct the AO that after verifying the exact holding of land by assessee and the land taken on lease/rent basis, rework out the agricultural income of assessee. Accordingly, AO is directed to treat agricultural income as having been earned by the assessee, to the extent computed in terms of above direction. - Decided in favour of assessee for statistical purposes. Addition on account of low household withdrawals - Held that:- Direct the AO to accept ₹ 72,000/- as house hold expenses for the year under consideration and do the recomputation accordingly as decided by Tribunal in the preceding years. Addition on deficiency in the fund required for making investment - Held that:- Tribunal’s order in assessee’s own case for assessment years 2000-01, 2002-03, 2004-05 and 2005-06 stating that a perusal of the records reveals that the said addition was in fact the amount reflected by the assessee as its opening balance for the year under consideration (Rs 564260 opening balance shown by assessee – ₹ 82470 salary of assessee = ₹ 560117), which the AO as well as the Ld CIT(A) has treated as made on account of capital introduced from undisclosed source. Since it is the opening balance of the year as claimed by the assessee before the AO and CIT(A), which both did not accept and addition confirmed, we find this issue of amount reflected as opening balance needs to be recomputed since the Tribunal has accepted that the assessee is earning agricultural income, therefore, the accumulated cash balance which it reflects in the opening balance needs to be recomputed. - Decided in favour of assessee for statistical purposes. Undisclosed Investment on property purchased - CIT(A) deleted addition accepting the source of ₹ 5,05,000/- from his own past saving in bank account and cash with him (assessee)- Held that:- What the ld CIT(A) has done was that out of the addition of ₹ 18,05,000/- made by AO in respect to purchase of properties, only ₹ 7 lakhs has been found to be explained by the assessee to the satisfaction of the ld. CIT (A). The other claims of the assessee as to his source for purchasing the land costing ₹ 17.73 + stamp duty= i.e. ₹ 18,05,000/- lakhs have been arrived by the Ld CIT(A) by bringing the amount added by the AO, which in turn has been confirmed by the Ld CIT(A) for the preceding and this assessment year to justify the source for purchase of land.CIT(A) says that since this amount which is confirmed as income from undisclosed source is in the hands of the assessee, so he had the source to buy the properties. However, we take note that now because of the order passed by the Tribunal on 30.04.2010, the amounts confirmed by the Ld CIT(A) also has taken transformation, e.g. the amount confirmed by the Ld CIT(A) includes the amount claimed by the assessee as agriculture income and also the amount reflected as opening balance, so in that scenario, once the AO has recasted the cash flow statement where credit for agricultural income and opening balance are taken, if there is sufficient cash to justify ₹ 11,05,000/-, then the AO is directed to delete the addition and in case there is any deficiency or difference, then that amount be confirmed as income from undisclosed source. Therefore the deletion of addition of ₹ 11, 05,000/- is set-aside, and the issues limited to this addition is remanded back to the file of AO, to re-compute as directed above - Decided in favour of revenue for statistical purposes.
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