TMI Blog2010 (5) TMI 499X X X X Extracts X X X X X X X X Extracts X X X X ..... ate contention of the assessee has also no merit because the assessee has not disclosed any agricultural income in the assessment year under appeal. In the absence of any evidence of earning of agricultural income, the alternate contention of the learned Counsel for the assessee cannot be accepted. - Addition made by AO confirmed. - IT Appeal No. 2797 and 2798 (Ahd.) OF 2006 - - - Dated:- 21-5-2010 - G.D. AGARWAL, VICE-PRESIDENT J, AND BHAVNESH SAINI, JUDICIAL MEMBER J, Tushar P. Hemani for the Appellant. B.S. Sandhu for the Respondent. ORDER Per Bhavnesh Saini: Both these appeals by the same assessee shall be disposed of by this common consolidated order since both were heard together for the sake of convenience. 2. We have heard the learned representatives of both the parties, perused the findings of the authorities below and considered the material on record. Both the appeals are time barred by 2 (two) days. However considering the reasons for delay explained by the assessee vide her application dated29-01-2007 and10-11-2009, the nominal delay in filing the appeals is condoned. ITA No.2797/Ahd/2006: AY 2002-03 3. This appeal by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is investment of Rs.20 lacs in LIC policies was treated as money received by the assessee towards her share of agricultural income. Statement of Shri Gunvantrai V. Shah was recorded and Arbitrator s award was also produced in support of assessee s claim. However, the AO has rejected the claim of the assessee for the reasons given in Paras 5.4, 5.5, 5,6 and 5.7 of the assessment order. The AO observed in this Paras that LIC policies have been purchased prior to the award. It would show that there was no dispute between the assessee and her brother. Appointment of arbitrator and declaration of award is, therefore, made up story and the assessee was not able to explain the sources of purchase of LIC policies. Brother of the assessee has not shown any agricultural income in his return of income. The assessee has also not shown agricultural income in her return of income. Shri G. V. Shah has not been able to produce any evidence that he has earned agricultural income to the extent of Rs. 4 lacs to Rs. 5 lacs per year, Shri G. V. Shah has also not been able to produce any evidence regarding availability of the money on the date on which investments were made in purchase of LIC policies. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... As against this factual matrix of that decision the position in this case is that the appellant and her husband have been doing business on a fairly large scale as is evident from the disclosure made by her husband in a sum of more than Rs. 2.76 crores. 9. Other five cases whose gist is attached also do not support the appellant s case because in the ultimate analysis it is a question of weighing the reliability of the evidence produced after taking all the attendant circumstances into account. 10. On the other hand, there are two decision of the Supreme Court which go to support the Department s case. In CIT v. Durga Prasad More 72 ITR 807 the appellant had tried to support his case on the basis of certain recitals in some trust deed etc. though after taking into account the totality of outcome did not appear to be probable. The Supreme Court held that the Income-tax Department was not bound to accept such self-serving statements and they can find out the reality of the situation. 11. In Sumati Dayal v. CIT [1995] 214 ITR 801 (SC) for explaining availability of money with her she claimed that she had won many jackpots in the horse-race and, in support of that c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... F property. Learned Counsel for the assessee however, admitted that HUF was not filing any return of income showing agricultural income. He has also admitted that arbitration agreement was between the assessee and her brother only and another sister was not party to it. He has submitted that the assessee has discharged her onus to prove investments in LIC policies and cash given to her in subsequent year. The source of investment is explained. It is well settled that assessee need not prove source of the source and relied upon the decisions of the Hon ble Gujarat High Court in the case of CIT v Pragati Co-operative Bank Ltd. 278 ITR 170 and in the case of Murlidhar Lahorimal v CIT 280 ITR 512. He has submitted that since the brother of the assessee appeared before the AO and in his statement admitted for making investments in LIC policies and cash given to the assessee as per the arbitration award, therefore, the assessee discharged her onus. The learned Counsel for the assessee submitted that brother of the assessee kept cash with him for several years and keeping cash at the most would have some suspicion but there is no bar under the law to keep cash out of agricultural ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dispute that the assessee and her brother have never shown agricultural income in their return of income. No return of alleged HUF is filed to show any agricultural income. No evidence is also produced of availability of funds on the date of purchase of LIC policies on cash between 25-05-2001 to 24-12-2001. All the LIC policies purchased are not in the name of the assessee but in the name of her husband also. The name of LIC Agent is not explained through whom LIC policies of substantial amount during the short span of period have been purchased. In the statement of Shri G. V. Shah, brother of the assessee, he has admitted that there was no dispute with other sister who was also one of the alleged joint owners in the agricultural land. In his statement he has explained that according to settlement through the award, he has given the LIC policies of Rs. 20,00,000/- to the assessee in the year under appeal along with Rs. 4,51,000/- in cash in the month of March, 2003. He has admitted that no amount is given to the other sister. The name of the LIC Agent through whom he has purchased the LIC policies is also not known to him. He has however, failed to produce any proof of availabilit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The Hon ble Supreme Court in the case of Smt. Sumati Dayal 214 ITR 801 similarly held that the Courts and Tribunal should consider the surrounding circumstances by applying the test of human probabilities . If the above principle laid down by the Hon ble Supreme Court is applied to the facts and circumstances of this case, it would lead to irresistible conclusion that Rs. 20,00,000/- invested in the LIC policies was unaccounted income of the assessee only. The story set up by assessee that this amount was invested by the brother of the assessee after settlement through arbitration award is clearly afterthought and against all human probabilities. The contention of the assessee thus cannot be accepted. It is also unnatural conduct of the assessee and her brother that despite their father expired in September, 1993, the assessee and her brother suddenly awake up after expiry of around 10 years in 2003 for making reference for arbitration. The conduct of the assessee and her brother speak against themselves. The assessee has thus failed to explain the source of investments in purchase of LIC policies and amount received of Rs. 4,51,000/-. No earning of agricultural income is als ..... 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