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2018 (1) TMI 1426 - AT - Income TaxDisallowance of the claim of earning agricultural income - AO decided the issue against the assessee on the primary reason that possession of agricultural land was not at all handed over to assessee on entering into agreement of sale on 17.01.2013 - Held that:- In the present case, the assessee produces the agreement to sell wherein there is a clause of handing over possession of landed property to the assessee and this was confirmed by the seller that he has handed over the landed property on entering into sale agreement. There is evidence produced by the assessee before the AO in the form of estate books of account like expense bills, indent copies.The lower authorities opted not to comment on these documents and went on to hold that possession of property was not at all handed over to assessee vide agreement of sale dated 17.01.2013. \ In opinion thereof, the evidence brought on record by the revenue authorities was not sufficient to establish their stand that the assessee has not taken possession of land and cultivated the same and sale agreement is only paper transaction or bogus. The entire evidence has to be appreciated in a wholesome manner and even where there is documentary evidence, the same can be overlooked if there are surrounding circumstances to show that the claim of the assessee is opposed to normal course of human thinking and conduct or human probabilities. Even applying this principle to the instant case, there was some difficulty in rejecting the assessee’s plea as opposed to the normal course of human conduct. The surrounding circumstances of the case were also not strong enough to justify the rejection of assessee’s plea as outrageous or fabricated one. Taking possession of land vide sale agreement and also carrying out of agricultural activities in the said land has to be accepted. However, the quantum of agricultural income declared in the impugned land is very much on the higher side which cannot be accepted to that extent. AO considered the entire amount of ₹ 29,32,653 declared by the assessee as non-agricultural income. This view of the AO is very unreasonable and vindictive in nature. As already stated, the declaration of ₹ 29,32,653 as agricultural income out of the area of land measuring 26 acres 9 guntas is on the very higher side which cannot be reasonable. Hence make a reasonable estimate of 50% of ₹ 29,32,653 i.e., ₹ 14,66,327 as agricultural income and the balance amount as income from other sources at ₹ 14,66,326. Thus, assessee gets relief of ₹ 1,46,66,327. It is accordingly directed. - Decided partly in favour of assessee.
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