2019 (6) TMI 351 - AT - Income Tax

Addition of non-genuine agricultural income - HELD THAT:- We observe that the Revenue authorities have nowhere disputed that the assessee holds agricultural land measuring 10 acres since last many years. It is a known fact that regular maintenance of books of accounts and documentary evidences for each and every transactions entered into during the course of agricultural operations for buying the seeds, labour charges, sale of produced, purchase of fertilizers etc. cannot be fully documented for various practical reasons. AO has also not placed any contrary material to support its finding. Only remedy is estimation of income per acre. In certain cases as referred in the finding of the Ld. CIT(A), the tribunal has estimated income per acre at ₹ 15000/- during A.Y. 1998-99 and ₹ 25000/- during A.Y. 2005-06.

We are of the view that Ld. CIT(A) has rightly estimated the agricultural income of ₹ 30000/- per acre for A.Y. 2009-10. No interference is therefore called for in the well reasoned finding of the Ld. CIT(A). We uphold the same and dismiss the revenue’s ground.

Unexplained investment in gold - HELD THAT:- CIT(A) has rightly given the benefit of 350 gms of gold jewellery (250 gms for daughter and 100 gms for son) thereby giving relief of ₹ 5,80,555/- and confirming the remaining amount as unexplained investment at ₹ 86,535/-. No reason to interfere in the finding of Ld. CIT(A) deleting the addition of ₹ 5,80,555/- and same is upheld.

Addition for unaccounted investment - on money paid for purchase of land - adition based on seized loose papers - HELD THAT:- The impugned addition for unaccounted investment in the land has rightly been deleted by CIT(A) as they were merely based on the rough jottings on the alleged seized loose papers which were not signed by any of the parties, nor transaction mentioned therein have actually taken place nor revenue has been successful to place any contrary material in the form of valuation report of the impugned land to support the market price of land adopted for making the addition ‘ON MONEY’ payment. Therefore the alleged seized loose papers are Dumb documents and addition cannot be made on such dumb documents. Rather the jottings on the seized papers were stated to be a part of future planning and references of the transaction in the loose papers are not supported by any corroborative evidence and the evidence in the form of registered sale deeds only indicates that the transaction of purchase/sale of land between the various concerned parties was actually entered at consideration of ₹ 5 crores only and no evidence of any ‘ON MONEY’ of ₹ 8,74,60,600/- has been paid - No reason to interfere in the finding of Ld. CIT(A) deleting the addition

Addition of non-genuine unsecured loans - admission of additional evidence - HELD THAT:- In the interest of justice we accept the request of both the parties and set aside this issue of unexplained cash credit to the file of CIT(A)for afresh adjudication with a direction that the additional evidences filed by the assessee which were not placed before the assessing officer should be sent to the assessing officer calling for remand report and thereafter decide the issue afresh as per the provisions of law after giving reasonable opportunity of being heard to the assessee.

Validity of reassessment u/s 148 - HELD THAT:- There was certain information relating to these 14 assessee’s found by the search team during the search u/s 132 of the Act conducted on 21.7.2008 at the premises of Mr. Mukesh Sharma including a memorandum of agreement for purchase of land by Mr. Mukesh Sharma and 14 other parties. Certain loose papers were also seized which as per the Ld. A.O indicated some undisclosed investment. Return were filed on 31.03.2010 and notice u/s 148 of the Act issue within 4 years i.e. before 31.03.2014. Proper opportunity was given to assessee(s) to reply to the reasons recorded for reopening. In our considered view the cases of 14 assessee’s were fit case for issue of notice u/s 148 of the Act and for conducting reassessment proceedings u/s 147.

Addition on protective basis in the hands of the assessee’s for the unaccounted investment in purchase of 1.9 hectare land jointly with Mr. Mukesh Sharma purchased from Mr. Vinod Vaish - addition based on loose papers - HELD THAT:- Following the holding in Assessment Year 2009-10, we are of the view that both the lower authorities were not justified in making the addition on protective basis in the hands of all the 14 assessee’s. We accordingly allow this common issue in the case of the 14 assessee’s and delete the addition made on protective basis on un accounted investments in purchase of land

Disallowance for expenses - difference between the amount deposited in the bank/amount of land taken and the amount admitted as undisclosed income - HELD THAT:- In the instant case though the actual source of earning the undisclosed income has not been stated but claiming certain expenses against the earning of said undisclosed income cannot be brushed aside. However, Ld. CIT(A) failed to adjudicate this issue and in the interest of justice we are of the view that this common issue needs to be set aside to the file of Ld. CIT(A) for adjudication after giving reasonable opportunity of being heard to the assessee’s.

Power of CIT(A) - exceeding of Jurisdiction - direction to the Ld. A.O to reopen the cases for A.Y. 2010-11- appeal relates to A.Y. 2009-10 - HELD THAT:- CIT(A) has the powers to decide the appeal against the assessee of a particular assessment which he/she may confirm/reduce or enhance or annulled. The order of the assessment relates to particular assessment year or assessment years. Ld. CIT(A) is bound to adjudicate the issues emanating out of the appeal for the respective assessment year. Giving directions to the A.O to consider for re-assessment for other assessment years for which no appeal is pending before CIT, in our view seems to be out of his/her jurisdiction. In the instant case it seems that Ld. CIT(A) has exceeded her jurisdiction of giving direction for reopening of cases for Assessment Year 2010-11 because the appeals of the assessee(s) were pertaining to Assessment Year 2009-10 only. We therefore allow this common issue raised by the respective assessee’s.