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2023 (10) TMI 253 - ITAT BANGALOREAddition being difference in closing stock - As noticed that in closing stock shown there was a mistake leading to the under-stating of closing stock - HELD THAT:- The mistake was crept while preparing the stock inventory manually by sales girl that was corrected by assessee and computerized rectified stock inventory has been filed and it cannot be said that it is an after-thought. When the mistake was noticed by assessee, it was rectified by computerizing the same. GP rate commensurate with earlier year rate of GP rate. Accordingly, addition made towards discrepancy in stock inventory is not proper. Accordingly, delete the addition so made. Addition being other income instead of agricultural income - agricultural income declared from the lands which he has taken on "Land tenancy or Lease or Geni" - HELD THAT:- The assessee has filed the lease deed from these parties for taking the lands from above parties. The assessee was asked to produce the copy of agreement entered into for acquiring lands on Tenancy, along with copy of Pahini, Bill in support of sale of agricultural products and details of expenses to verify the genuineness of the agricultural income declared by the assessee. The bills produced does not bear the name of the assessee nor the name of the original land owner. According to the AO, assessee violated the Law of Karnataka Land Reforms Act, which was confirmed by the Tahsildar, Shivamogga vide his letter dated 10.12.2009. On this basis, the lower authorities observed that no Tenancy shall be created or continued in respect of any land nor shall any land be leased for any period as per section 5(1) of the Karnataka Land Reforms Act, 1974. Accordingly, lower authorities confirmed the treatment of agricultural income declared by the assessee as non-agricultural income i.e. income from other sources. In our opinion, violation of Karnataka Land Reforms Act cannot be reason to disallow the claim of assessee as agricultural income.
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