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TMI Blog2012 (8) TMI 511X X X X Extracts X X X X X X X X Extracts X X X X ..... d under sec.143(3) of the Income-tax Act, 1961. 2. In the return filed for the impugned assessment year, the assessee has offered for rate purposes an agricultural income of Rs. 15 lakhs. The Assessing Officer disallowed Rs. 8 lakhs from the claim of the assessee and treated the balance of Rs. 7 lakhs alone as agricultural income. He added the disallowed agricultural income of Rs. 8 lakhs as income from other sources taxable in the hands of the assessee. In first appeal, the Commissioner of Income-tax(Appeals) reduced the addition of Rs. 8 lakhs to Rs. 4 lakhs taxable under the head 'income from other sources'. 3. The assessee is aggrieved on the addition of Rs. 4 lakhs sustained by the Commissioner of Income-tax(Appeals) and, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income. The Commissioner of Income-tax(Appeals) has accepted Rs. 11 lakhs as agricultural income and treated Rs. 4 lakhs as non agricultural income. If this amount of Rs. 4 lakhs not accepted as agricultural income is ignored, as argued by the assessee, what will happen? The Assessing Officer will accept the taxable income and another Rs. 11 lakhs as agricultural income for rate purposes. As the quantum of agricultural income has been reduced from Rs. 15 lakhs to Rs. 11 lakhs, additional tax arising out of rate difference will be less than what has been disclosed by the assessee in his return. This is because that part of agricultural income not accepted by the Department is ignored and not treated as part of taxable income. The quantum o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, this legal argument of the assessee cannot be accepted. 11. Regarding the quantum of addition sustained by the Commissioner of Income-tax(Appeals), we find that some modification is called for. The agricultural income offered by the assessee for the subsequent assessment year was Rs. 13.5 lakhs. The assessee is having substantial agricultural holdings and he is carrying on agricultural activities. In these circumstances, we hold that a disallowance of Rs. 2 lakhs will meet the ends of justice. Accordingly, the addition of Rs. 4 lakhs made by the Commissioner of Income-tax(Appeals) is reduced to an addition of Rs. 2 lakhs. In that way, the appeal is partly successful on the quantum side. 12. In result, this appeal filed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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