TMI Blog2015 (7) TMI 527X X X X Extracts X X X X X X X X Extracts X X X X ..... the exact holding of land by assessee and the land taken on lease/rent basis, rework out the agricultural income of assessee. Accordingly, AO is directed to treat agricultural income as having been earned by the assessee, to the extent computed in terms of above direction. - Decided in favour of assessee for statistical purposes. Addition on account of low household withdrawals - Held that:- Direct the AO to accept ₹ 72,000/- as house hold expenses for the year under consideration and do the recomputation accordingly as decided by Tribunal in the preceding years. Addition on deficiency in the fund required for making investment - Held that:- Tribunal’s order in assessee’s own case for assessment years 2000-01, 2002-03, 2004-05 and 2005-06 stating that a perusal of the records reveals that the said addition was in fact the amount reflected by the assessee as its opening balance for the year under consideration (Rs 564260 opening balance shown by assessee – ₹ 82470 salary of assessee = ₹ 560117), which the AO as well as the Ld CIT(A) has treated as made on account of capital introduced from undisclosed source. Since it is the opening balance of the year as cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Varkey, JJ. For the Petitioner : S/Shri S.R. Parashar S.S. Parashar, Advocates For the Respondent : Shri B.R.R. Kumar, Senior DR ORDER PER A.T. VARKEY, JUDICIAL MEMBER : These are cross appeals filed by the assessee and revenue against the order dated 20.11.2008 passed by the Commissioner of Income-tax (Appeals), Rohtak pertaining to assessment year 2003-04. 2. The assessee has raised the following grounds in its appeal :- (i). That at the very outset the impugned order dated 20.11.2008 passed by the Ld. Commissioner Rohtak confirming the addition of opening balance ₹ 5,60,117/- shown by the appellant in his balance sheet, addition of agricultural income of Rs. l,90,500/-and addition of ₹ 40,000/- on account of house-hold drawings is void and illegal in as much as the said additions have been confirmed without appreciating the law, facts and circumstances of the case submissions made and material available on record . (ii). That the Ld. appellate authority has erred in law in confirming the additions of ₹ 5,60,117/- In the income of the appellant on account of opening balance, without recording the totally contrary to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner has admitted and accepted the income from agricultural land in his appellate order on the average yield to be between ₹ 7500/- to ₹ 10,000/- on normal land per acre in the cases of I.T.O. Versus S/Sh. Hanuman Singh, Gauri Shankar, Bhoop Singh, Ram Kumar and others of Village Mangali, Hissar in Appeal Nos.42,43,44,55,56,57/HSR/2008-09 and 69 and 70/HSRl2007-08. But while deciding the appeal of the appellant, the entire agricultural income of ₹ 1,90,500/- shown and declared by the appellant from 6 1/2 acre of land yielding a profit of ₹ 14,846/- has out rightly been rejected even without accepting any income from agricultural land. It is pertinent to mention here that the average yield to be taken between ₹ 7,500/- to ₹ 10,000/- by the Commissioner on normal land is situated in Distt. Hissar . is un-irrigated and is of C and D Category of land which is not capable of producing two crops in a year while the agricultural land owned and cultivated by the appellant is situated in Village Pipli, Distt. Sonepat which is fully irrigated and is capable of producing full two crops in a year being land of A Category and full of fertility. These facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered by him without assigning any reason and without recording any finding. Therefore, the said additions made by the Ld. A.O are bad in law and are wholly un-founded and misconceived and are liable to be deleted. Copy of the written submissions enclosed. It is, therefore, prayed that since the additions of ₹ 5,60,117/- on account of opening balance shown in the balance sheet by the appellant, additions of ₹ 1,90,500/- on account of agricultural income and' additions of ₹ 40,000/- on account of low drawings made by the A.O. in the income of the appellant by his order dated 22.12.2007 as income from un-disclosed sources and confirmed by the Ld. CIT [Appeals] Rohtak by his order dated 20.11.2008 are arbitrary, unjust and illegal and contrary to law and facts and the same may kindly be deleted by way of accepting the present appeal of the appellant. 3. The grounds taken by the revenue reads as under :- (i). On the facts and in the circumstances of the case the Ld. CIT(A) has erred in law and facts in deleting the addition of Rs.l,50,000/- on account of unsecured loan from assessee's wife for which he could not prove the genuineness of source of inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the-assessee before the CIT(A), the CIT(A) accepted the gift of ₹ 7 lakhs having been made by the mother in law of the assessee and after giving due credit of the same, made an addition of ₹ 5,60,170/- on account of deficiency in the fund required for making investment during the year under consideration. The CIT(A) has also confirmed the addition of Rs.l,27,981/- on account of low household expenses and also confirmed AO's action for treating agricultural income as income from other sources. 9. We have considered the rival contentions. In view of our observation made hereinabove regarding agricultural income having been earned by the assessee, we direct the AO to recast the cash flow statement and to work out the addition to be made on account of short availability of funds. On account of household expenses, we direct the AO to accept ₹ 72,000/- on account of household expenses and any shortfall out of the withdrawals shown by the assessee may be treated as income from undisclosed sources. We direct accordingly. 6. In the light of the aforesaid order pertaining to the A.Y. 2003-04 as aforesaid, and finding that I.T.A. Number and year of assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oan of ₹ 2.5 lakhs; and assessee had invested ₹ 5.05 lakhs from has past savings of several years withdrawn from the saving bank account and also cash lying with the assessee in his house from his agricultural land. 9. This explanation was disbelieved by the AO and he made the addition of ₹ 18,05,000/- as assessee s income from undisclosed source. On appeal, the Ld. CIT(A) was pleased to hold that the amount for purchase of land was in assessee s hand and deleted the said addition, but confirmed certain addition made by the AO. The assessee is aggrieved by the addition sustained by the Ld. CIT(A) and the Revenue is aggrieved by the deletion of certain additions by the Ld. CIT(A). As said before, we will first deal with the assessee s appeal. 10. Before we look in to the issues raised by the assessee in his appeal before us, let us first see, the order passed by the Tribunal in appeals preferred by assessee for preceding Years i.e. 2000-01 2001-02 and subsequent years i.e. 2004-05 2005-06 which was by a common order dated 30.04.2014 (supra). A perusal of the order of the Tribunal dated 30.04.2010 (supra), we find that the Tribunal had dealt with three iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also recorded by the AO wherein they have accepted the fact of their share of land having been given to the assessee for cultivation. Keeping in view the fertility and location of the land where it is situated, we can reasonably estimate the same at ₹ 10,000/- per bigas. In respect of land taken on rent ₹ 5,000/- per bigas. AO after verifying the exact holding of land by assessee and the land taken on lease/rent basis, rework out the agricultural income of assessee. Accordingly, AO is directed to treat agricultural income as having been earned by the assessee, to the extent computed in terms of above direction. 12. We find that in this assessment year also, the AO has not accepted the assessee s claim of having earned any agricultural income contrary to his claim of earning of ₹ 1,90,500/-; and following suit, CIT (A) also had the same view of AO; and accordingly the Ld CIT(A) upheld the action of AO and treated ₹ 1,90,500/- claimed by assessee as agricultural income as income from undisclosed sources. The assessee is aggrieved by the said impugned order of the CIT (A). Now, as it has been held by the Tribunal in the preceding years to the instant asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be recomputed since the Tribunal in para 4 (supra) has accepted that the assessee is earning agricultural income, therefore, the accumulated cash balance which it reflects in the opening balance needs to be recomputed. So this issue regarding disallowance of opening balance for the year under consideration needs to go back to the file of the AO for recasting of cash flow statement where credit for agricultural income has to be given in terms of the Tribunal s direction in para 4 of the Tribunal s order dated 30.04.2010 (supra) for preceding and subsequent year. 15. In the light of the above decision and directions given by us, the appeal of the assessee is partly allowed. 16. Now we take up the revenue s appeal (ITA No.338/Del/2009). 17. On a perusal of the impugned order of the ld. CIT (A), we find that the ld. CIT (A) has given relief to the assessee by accepting the assessee s contention in respect to investment of ₹ 18,05,000/- on property purchased as stated above. Facts are repeated again for clarity. For the year under consideration, we find that the assessee has purchased two agricultural lands for a consideration of ₹ 4,52,000/- on 28.02.2002 and anot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,91,725/- (Rs.2,66,452/- + ₹ 1,25,273/-) for the assessment year 2002-03; and for the assessment year under consideration, (i.e. AY 2003-04) he has confirmed addition of ₹ 7,50,500/- (Rs.5,60,000/- + ₹ 1,90,500/-), which we have dealt above. Thus, the Ld CIT (A) came to a conclusion that since the assessee was having this amount as income from undisclosed sources to the tune of ₹ 11,42,225/- (Rs.3,91,725/- + ₹ 7,50,500), which when added with the gift of ₹ 7 lakhs ( amount which is not challenged by revenue in this appeal), will come to ₹ 18,42,225/- (Rs 11,42,225 + ₹ 7,00,000). Thus, according to the ld. CIT (A), the assessee had sufficient fund in his hands to purchase the property valued at ₹ 17,73,000/-.+stamp duty comes to ₹ 18,05,000/- 20. However, it should be noted that the assessee when confronted by the AO to explain the source of purchase of the two lands, had been changing his version of source different from which he said before the DDI on 22.01.2007, that he has taken loan from Shri Attar Singh of ₹ 10 Lakhs i.e. 5lakhs cash on 20.08.2002 and ₹ 5lakhs cash on 24.10.2002, then before AO, he gave ..... X X X X Extracts X X X X X X X X Extracts X X X X
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