TMI Blog2010 (2) TMI 908X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 5.30 lakhs in the assessment year 1992-93. Accordingly, we can only make a fair estimate and taking the figures of earlier years, we estimate the disallowance at Rs. 1 lakh only and the balance can be treated as agricultural income. The Assessing Officer is directed to recompute the disallowance at Rs. 1 lakh only. This issue of the Revenue's appeal is dismissed and that of the assessee is partly allowed. Uexplained investment - Held that:- As before us the assessee has explained the sources as the availability of funds and investment made out of the same. CIT(A) has recorded the facts, that from the agricultural activity and diary farming, the assessee having income which is not disputed. Once the funds to the tune of Rs. 60 lakhs for investment are available with the assessee, the source itself is explained and accordingly, we delete this addition and to that extent the order of the Commissioner of Income-tax (Appeals) is revised - unexplained investment in household items and unexplained investment in immovable property, has been explained taking the capital available with the assessee and funds available in terms of income and assets, by the AO for all ten years. De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g as disclosed but making certain disallowance of unexplained expenditure on account conveyance, repair and maintenance and miscellaneous expenses as not related to agricultural activity vide order dated March 28, 2000. Aggrieved against the assessment orders, the assessee preferred an appeal before the Commissioner of Income-tax (Appeals) for all the ten assessment years, i.e., 1987-88 to 1996-97, challenging the disallowance of agricultural expenses at 50 per cent. The Commissioner of Income-tax (Appeals) dismissed the appeals of the assessee for all these assessment years by a common order vide order dated December 26, 2000. Aggrieved, the assessee preferred appeal before the Tribunal. The Tribunal vide consolidated order for all these 10 assessment years set aside the issue of disallowance of agricultural expenses to the file of the Assessing Officer for re-examination after providing opportunity to the assessee of being heard. The Assessing Officer in the second round framed the assessment while giving effect to the order of the Tribunal. During the second round the Assessing Officer raised the issue of status of the Hindu undivided family by stating that return of income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18.6 to 18.8 as under:- "18.6 I have carefully gone through the submissions of the appellant and also the facts mentioned by the Assessing Officer in his assessment order I am of the view that the Assessing Officer has not brought out sufficient and convincing reasons in the assessment order to deny the claim of the status of the appellant as the Hindu undivided family. The status of the Hindu undivided family appears to have been rejected merely on technical grounds. The certificate of Mamlatdar submitted by the appellant supports the contention of the appellant and besides, its veracity has also not been questioned by the Assessing Officer. Thus, I am of the view that Assessing Officer was not justified in rejecting the status of the Hindu undivided family. In view of these facts of the case, the income in the hands of the appellant Shri C. J. Rathod (Hindu undivided family) is to be taxed on 'substantive' basis and not on 'protective' basis." Aggrieved, the Revenue came in the second appeal before us. Before us the learned senior Departmental representative, Shri C. K. Mishra argued on behalf of the Revenue. He stated that the Tribunal has set aside the orig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee and a certificate from the Mamlatdar of Silvassa stating that the assessee has inherited pieces of agricultural land totally addition measuring 4 hectare and 5 acres. According to learned counsel, once the Assessing Officer has accepted the status of the assessee as Hindu undivided family and which was not challenged either by the Revenue or by the assessee in appellate proceedings, in the set aside assessments the Assessing Officer has no power to enquire into the status and change the status from the Hindu undivided family to individual. He also taken us to the Tribunal's order setting aside the assessment dated April 4, 2003 and stated that the issue before the Tribunal was only restricted to disallowance of expenses to the extent of 50 per cent, of total expenditure made on account of agricultural activities. He read out the Tribunal's order findings in paragraphs 3 and 4. He also referred to the case law of the hon'ble jurisdictional High Court in the case of CIT v. Steel Cast Corporation [1977] 107 ITR 683 (Guj) and in the case of Nitin P. Shah alias Modi v. Deputy CIT [2005] 276 ITR 411 (Guj). He stated that the jurisdictional High Court is exactly on the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenditure. The provisions of section 60C are mere clarificatory and embody a rule of evidence. Even otherwise an addition could be made in respect of the amount of expenditure which the assessee is found to have been actually incurred but not satisfactorily explained. From the phraseology of this section it transpires that the condition precedent as to the existence of expenditure must be conclusively established by evidence. 4. There is absolutely no discussion in the impugned orders as to the character and allowability of the expenditure with the other activities. What are those other activities. What for the expenditure was incurred. How much agricultural and the assessee is holding. What crops it was producing. Evidence of realisation of agricultural income could have been examined with reference to the revenue records. This was not done. As a matter of fact there was no examination apropos the character of income and the expenditure. In my opinion the case was not examined in the right perspective. I therefore in the interest of justice set aside the impugned orders and restored it to the file of the Assessing Officer with a direction to decide it afresh, in accordance wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h was subsequently remanded to the Assessing Officer. Similarly the order of remand dated September 20, 1989, made by the Tribunal in T. A. No. 454 of 1989 does not cover the turnover of Rs. 20,23,290. Consequently, in the present proceedings initiated against the order of the Assessing Officer dated November 30, 1990, passed pursuant to the order of remand dated September 20, 1989, in T. A. No. 454 of 1989, it is not at all open to the petitioners to canvass the correctness of the order of the Assessing Officer dated August 18, 1989, which has become final. In these circumstances, the appellate authority and the Tribunal rightly held that the question relating to the turnover of Rs. 20,43,522.90 cannot be agitated in the present proceedings as the order of the appellate authority dated March, 27, 1989, in Appeal No. 57 of 1988 and the order of the Assessing Officer dated August 18, 1989 in respect of the turnover of Rs. 20,43,522.90 has already become final. 3. Mr. Chandran, learned counsel for the petitioners submitted that subsequent to the order of remand dated September 20, 1989, in T. A. No. 454 of 1989, the orders of the assessing authority and the appellate authority, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after the remand, it has no power to reconsider the finding or opinion. Questions which have become final and concluded by the remand order cannot be reopened." In view of the above case law, we are of the view that where a matter is taken in appeal before Tribunal against a fresh assessment order made in pursuance of remand by the appellate authority, the Tribunal has no jurisdiction to consider and decide a particular point which has already been decided by the assessing authority in the original assessment order and has become final and no such further proceedings were as such taken against such assessment order. This is so, because otherwise the procedure would offend against the rule of finality of judicial proceedings. Another facet of the arguments made by learned counsel for the assessee are that the Revenue has not disturbed the status of the Hindu undivided family from the assessment years 1987-88 to 1994-95 as no appeal has been filed by the Revenue for these assessment years. Even the Revenue has accepted the status of the Hindu undivided family for the above-mentioned assessment years and, can the Revenue now on this point is entitled to claim that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded only if fresh facts come to light or if the earlier decision was rendered without taking into consideration material evidence, etc.'" The facts of the present case before us clearly states that the status of the Hindu undivided family has been accepted by the Assessing Officer after due inquiry and going through the documentary evidence produced before him and the Revenue has not challenged the findings of the Assessing Officer for the assessment years 1987-88 to 1994-95. To that effect, that the status of the assessee is the Hindu undivided family in those assessment years, Subsequent set aside by the Tribunal and that also not on this issue, status cannot be disturbed. Accordingly, we are in conformity with the findings of the Commissioner of Income-tax (Appeals) accepting the status of the assessee as Hindu undivided family and hold that whatever addition will be sustained, that will be in the hands of the Hindu undivided family and not in individual. Accordingly, common issue of all these appeals and cross-objection is decided in favour of the assessee and against the Revenue. Coming to the first common issue in I. T. A. Nos. 2023 and 2151/Ahd/ 2002 of the Revenue a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7,84,415 9,98,064 1995-96 8,31,604 10,55,608 1996-97 8,53,281 10,59,721 Total 48,17,857 61,60,346 In view of the remand report and submissions of the assessee, the Commissioner of Income-tax (Appeals) considered the income from other sources at Rs. 2.50 lakhs and balance was considered as agricultural income by giving the following findings in paragraphs 13.25 to 13.28:- "13.25 The purpose of citing these judicial decisions is to reinforce the contention that in order to conclusively establish that there is agricultural income right from the assessment year 1987-88 onwards in the case of the appellant, merely filing of certain bills regarding loan revenue or certificate of Mamlatdar or sale bills, etc., are not sufficient. The position may vary from year to year. There could be agricultural receipts say, in one assessment year but none in the immediately following year. Such eventualities are within the realm of possibility. 13.26 Thus the appellant's contention that as he had filed sufficient details the Assessing Officer was not justified in treating the agricultural income as income from ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case, the learned Commissioner of Income tax (Appeals) ought not to have confirmed the action of the Assessing Officer in making addition to the rune of Rs. 4,13,480 on account of investments in land and cash balance by treating them as unexplained investments under section 69. The action of the learned Commissioner of Income tax (Appeals) is contrary to the facts of the case and deserves to be deleted. 5. On appreciation of the facts and circumstances of the case, the learned Commissioner of Income tax (Appeals) has erred in making addition on account of interest at 18 per cent. on Rs. 12,82,977 being the amount of loans and advances given by the assessee to various parties. The action of the learned Commissioner of Income-tax (Appeals) is contrary to the facts of the case and deserves to be deleted." I. T. A. No. 2023/Ahd/2002:- "6. On the facts and circumstances of the case, the Commissioner (Appeals) was not justified in directing the Assessing Officer to tax the following income in the hands of C. J. Rathod, the Hindu undivided family on 'substantive basis' and not on 'protective basis'. (Rs.) Unexplained investment in the immova ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing Officer. He has also deleted the addition of unsecured loans and advances except the addition of Rs. 4,13,480. We find that the capital of the Hindu undivided family for the assessment year 1997-98 has been shown at Rs. 49,73,264 and this is supported by the capital account and copies of the balance-sheet for the assessment years 1987-88 to 1996-97 and in the assessment year 1997-98 the capital was at Rs. 4,61,928, the assessee has filed the details before the lower authorities and even before us now as under:- Particulars Amount Particulars Amount Household expenses 54,000 Opening balance 46,71,346 C. B. Rathod 2,00,000 Surplus on agricultural production 5,26,915 Bank charges 234 Surplus on non agricultural production 19,220 Closing balance 49,73,264 Rent of agricultural land 8,000 Bank interest 2,017 Total 52,27,498 52,27,498 (Rs.) Accumulated capital as on March 31, 1995 7,74,059 Amount taxed under the KVS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5-6-1996 Fatehsinh B. Solanki 36,000 Cash 10-12-1996 B. C. Rathod 11,13,463 Cash K. A. Chikhaliwala 1,31,000 The assessee purchased this land from Vhikubhai C. Rathod but due to the CBI enquiries purchased of land could not materialise and the advance was outstanding. The assessee has also obtained advance against sale of land from Nailesh B. Parmar and Jaidevsinh B. Parmar at Rs. 8 lakhs and Rs. 3 lakhs respectively. Taking into consideration the capital available with the assessee and the loans as per records, we find that the assessee has sufficient funds for advancing the amount considering the amount of Rs. 31.53 lakhs retained by the individual to the Hindu undivided family. Accordingly, we find no infirmity in the order of the Commissioner of Income-tax (Appeals), deleting the same and we confirm the same. We find that in entirety, unexplained investment in household items and unexplained investment in immovable property, has been explained taking the capital available with the assessee and funds available in terms of income and assets, by the Assessing Officer for all ten years. Accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly not charged any interest and these loans were interest free loans. As there is no charge of interest, the assessee is not entitled for any income. Accordingly, the deeming addition made by the Assessing Officer is deleted in view of the decision of the Tribunal in the assessee's group case Smt. Nirmala J. Rathod (supra). Coming to the Revenue's appeal No. 2023/Ahd/2002:- The addition in the case of individual has been made on the substantiated basis by the Assessing Officer but the Commissioner of Income-tax (Appeals) deleted the addition accepting the Hindu undivided family of the assessee and directed the Assessing Officer to treat the addition on the substantiated basis in the hands of the Hindu undivided family. The Commissioner of Income-tax (Appeals) deleted the addition from the individual as the above in I. T. A. No. 2022/Ahd/2002 for the assessment year 1997-98 in the case of the Hindu undivided family where we have decided the issue of status in favour of the assessee and the entire addition in the hands of the individual is deleted. Accordingly, this appeal of the Revenue is dismissed. Coming to the Revenue's appeal Nos. 1285-1286/Ahd/2006 and I. T. A. No ..... X X X X Extracts X X X X X X X X Extracts X X X X
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