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2016 (5) TMI 956 - AT - Income TaxInflation of agricultural income - artificial boosting of income by the assessee - Held that:- When an assessee asserts that the income raised by it is on account of sale of agricultural produces, onus is on the assessee to prove such agricultural income. In our opinion, assessee before us has failed to discharge this onus. Despite number of opportunities given by the AO assessee was unable to establish how it could raise so much plants and saplings from five hectares of green house area. As for the claim of the Ld. AR that even if the agricultural income is found to be incorrect, it would not warrant addition since there was no real income, we are afraid we cannot accept. This for the reason that a sum of ₹ 12 crores out of the dues shown by the assessee as receivable from its subsidiary has been converted by the assessee to share capital or treated as share application money. Whether converted to share capital or to transferred to share application money, there is an infusion of capital which is not a fictitious, but a real one. CIT (A) in our opinion was oblivious to the date of accounting of the supplementary invoice by the assessee which was on the very same day when it had raised original invoice. He was also oblivious to the ALP of the goods relating to the supplementary invoice fixed by the auditors at zero. He considered the raising of bogus invoices to inflate the agricultural income as mere non-compliance with procedures of the RBI or Customs. What we observe is that assessee had claimed agricultural income which was not possible from the type of holding it had, and had adopted dubious methods for this. Nothing was brought on record to show that there was any industrial practice in floriculture where two invoices were raised on the same day, on purportedly for a notional value and other purportedly based on subsequent realization. To be precise there cannot be any industrial practice of that sort at all. We are of the opinion that CIT (A) fell in error in deleting the addition made by the AO. We reverse the order of CIT (A) and reinstate the addition. - Decided in favour of Revenue.
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