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2022 (1) TMI 686 - AT - Income TaxReopening of assessment u/s 147 - Addition u/s 68 - AO not accepting the agricultural income shown by the assessee - HELD THAT:- Since Assessing Officer failed to provide the reasons for reopening of assessment to the assessee, respectfully following the above decision in the case of CIT v. Videsh Sanchar Nigam Ltd., [2011 (7) TMI 715 - BOMBAY HIGH COURT] to hold that reassessment is bad in law and accordingly the re-assessment order passed u/s. 143(3) r.w.s. 147 of the Act is quashed as bad in law. The additional ground raised by the assessee is allowed. Borrowed satisfaction - A.Y. 2010-11 - Reasons recorded are based on borrowed satisfaction and not on any satisfaction of the Assessing Officer. This is clear from the fact that the Assessing Officer has in the reasons recorded stated that the agricultural land is transferred in the name of the assessee only on 04.01.2016 which on the basis of facts and documents available on record is not correct as is also held by the Ld.CIT(A) - If this reason is not considered in the reasons recorded, then the only basis of the Assessing Officer that the cash deposit in the bank account is not out of agricultural income of the assessee is that, the assessee only produced some hand written cash receipts which do not inspire confidence. This also, the Ld counsel stated, is the conclusion of the ADIT (Inv) and not of the Assessing Officer. The decisions relied upon by the Ld. Counsel also fortify the view that reasons recorded should be based on the satisfaction of the Assessing Officer and not on borrowed satisfaction - satisfaction recorded in the reasons recorded by the Assessing Officer are borrowed and not his own. Thus, the order made under section 143(3) r.w.s 147 for assessment year 2010-11 is quashed as bad in law. The additional ground raised by the assessee is allowed. Estimating the agricultural income at 40% - Estimation of the agricultural income by the Ld.CIT(A) is entirely on assumptions and presumptions. The facts being the same in all the years, and the Revenue accepting agricultural income for the A.Ys. 2011-12 and 2012-13 and the lower authorities not bringing any evidence on record to hold otherwise, taxing the agricultural income shown by the assessee, as cash credit u/s. 68 of the Act is not correct. Therefore, the Assessing Officer is directed to exclude the income from sale of goats and goat mindvi from the agricultural income shown by the assessee and treat only the balance as agricultural income and recompute the income accordingly. Sale of goats and goats mindvi - HELD THAT:- We hold that the same is not an agricultural income, however, as fairly submitted by the Ld.counsel for the assessee that a reasonable sum may be estimated as net income, suggesting to be estimated at 5%, I find that the same is on the lower side. Accordingly, in the interest of justice, the income from the sale of goat and goat mindvi should be estimated at the rate of 10% of the sale. This ground of appeal of the assessee gets part relief. Ad hoc disallowance of 10 per cent of total purchases and other expenses debited to the profit and loss account in each of these three years - HELD THAT:- It is observed from the Assessment Order that the Assessing Officer has not given any basis for disallowing the other expenses other than the purchases made by the assessee. It appears that the reports of the field enquiries were also not confronted with the assessee for its rebuttal. Therefore, taking the totality of facts and circumstances into consideration, hold that if the disallowance is restricted to 5% it would meet the ends of justice.
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