TMI Blog2015 (8) TMI 917X X X X Extracts X X X X X X X X Extracts X X X X ..... e profit from various firms shown in the return of income and copy of accounts - CIT(A) deleted the addition - Held that:- The difference of ₹ 9,15,044/- was duly explained by the assessee even before the Assessing Officer, but it was not accepted by him whereas the ld. CIT(A) has examined the difference in the light of explanations of the assessee and being convinced with it the addition was deleted. The ld. D. R. has not pointed out any infirmity in the order of the ld. CIT(A). Moreover, the ld. CIT(A) has taken cognizance of the correct facts while deleting the addition. Since we find no infirmity therein, we confirm his order on this issue. - Decided in favour of assessee. Deduction under section 24 - CIT(A) deleted the addition - Held that:- As before the AO the issue was with regard to the income from house property, as the assessee has claimed deduction under section 24 of the Act. The assessee was having two properties and one property was self-occupied and ALV was to be computed for another property on which according to the Assessing Officer rent was of ₹ 18,000/- per month and by applying the same, ALV was worked out at ₹ 2.16 lakhs and after allowin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account of income from house property u/s 23 of the income tax Act, 1961 ignoring the fact that the assessee is the owner of two property and had claimed both the house properties as self occupied properties. 2. Apropos ground No.1, during the course of assessment proceedings, the Assessing Officer has noticed that the assessee has filed the return of income declaring total income at ₹ 8,03,480/- and agricultural income was shown at ₹ 20,00,750/-. The Assessing Officer has noticed that in the joint SB account in the name of the assessee and his brother, Shri. Sheik Mohd. Tarique with Bank of Baroda, Chowk, Lucknow there is cash credit entries of ₹ 39,31,550/-. The assessee was required to furnish source of these cash credit entries and in response thereto it was stated on behalf of the assessee that the cash deposit in the joint SB account is out of sale proceeds of Mango Orchard and different crops. It was also explained that from these source the assessee has declared agricultural income at ₹ 20,00,750/- in his return of income. In order to substantiate the agricultural income, the assessee has also produced Khasra and Khatauni and auction papers of Man ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his family have been earning agricultural income for more than 30 years and the amount of ₹ 39,31,550/- was part of the total agricultural income earned by two brothers i. E. the assessee and his brother, Shri. Sheik Mohd. Tariq. Moreover, in this year, the income of the mother, Smt. Sagira Khatoon is included, as she had expired and her 20% share has also been included in the income of the assessee and his brother. It was further explained that the Assessing Officer has made addition of the entire deposit in the hands of the assessee whereas 50% of the deposits belong to the brother of the assessee. 5. The ld. CIT(A) re-examined the issue in the light of assessee s contentions and the Income Tax Inspector s report and being convinced with the explanations of the assessee, he deleted the addition. The relevant observations of the ld. CIT(A) are extracted hereunder for the sake of reference:- 10. I have gone through the order passed of the A. O. u/s 143(3), written submissions filed by the appellant during appellate proceedings as well as the facts of the case. I now proceed to decide the appeal on the basis of the grounds of appeal raised before me. Ground No. I to I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so mentioned the existence of the adult trees on the appellant's land. As per order sheet entry dated 22nd April 2014 the appellant was required to file the Report of the Disstt. Horticulture Department regarding produce of mango and its sale rate. The same is also filed along with written submission on 15- 5-2014. As per the said report the income which can be generated from sale of mangoes itself is ₹ 50,16,600/-. Over and above the sale of mangoes the appellants claimed that the revenue generated from other agricultural operations is ₹ 2 to 3 lakhs per annum after deducting the expenses. 12. The appellant in his paper book has also filed the copies of the judgments of the ITAT, Lucknow Bench in his own case as well as his brother who is the co-owner of the lands for A.Y.'s 2006-07 and also the copy of the order the CIT (A)'s for A.Y. 2008-09 in the case of the appellant. On perusal of the decision of the Hon'ble ITAT reveals that the appellant and his brother were deriving agricultural income of ₹ 11,33,200/ each for A.Y. 2006-07. The appellant submits that during the said A.Y. 2006-07. the mother of the appellant Smt. Sagira Khatoon was a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee has contended that this is not the first year in which the assessee has shown agricultural income. The assessee owned Orchards which were auctioned to various auctioneers and the auction money was deposited from time to time in the joint bank account of the assessee with his brother, Shri. Sheik Mohd. Tariq and his brother has also claimed agricultural income for the impugned assessment year at ₹ 20,00,750/- equal to the agricultural income earned by the assessee which shows that both the brothers have earned equal agricultural income and agricultural income shown by the brother of the assessee has not been doubted by the Revenue. It was further contended that the assessee has also placed copy of the revenue record in order to establish the ownership of Orchards and once the assessee owned Orchards, there has to be some agricultural income; whereas the Assessing Officer has outrightly rejected the explanations of the assessee and made addition of the entire deposit in the joint bank account, in the hands of the assessee. Copies of the return filed by his brother, Shri. Sheik Mohd. Tariq and joint bank account are placed on record. Copies of the orders of the Tribunal in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is also noticed that the assessee has filed written submission before the ld. CIT(A) on which remand report was called by the ld. CIT(A) and thereafter on the remand report comments were also sought from the assessee. The ld. CIT(A), while adjudicating the issue, has taken into account the report of the Tehsildar, Malihabad, Lucknow and report of the Udhyan Adhikari, Lucknow with respect to the production of Mangoes from these Orchards and also report of the Income Tax Inspector. Keeping in view the reports, the ld. CIT(A) has held that no addition is called for, as the amount deposited in the joint bank account is agricultural income earned by the assessee. The ld. CIT(A) has also observed in his order that even after completion of the assessment, independent enquiry was also conducted in respect of receipt from the agriculture produces by the then Assessing Officer through an Inspector. Having taken note of all these facts, the ld. CIT(A) has deleted the addition. During the course of hearing, the ld. D. R. has simply placed reliance upon the order of the Assessing Officer and no defect was pointed out in the order of the ld. CIT(A). We, however, have carefully examined the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal before the ld. CIT(A) and reiterated his contentions. It was also contended that in case any addition is to be made it can only be made in the hands of the firm and not in the hands of the partners. He has furnished the complete details in this regard. It was further contended before the ld. CIT(A) that on making addition, the Assessing Officer has ignored, rather failed to appreciate the fact that the amount of ₹ 29,80,754/- claimed as exempted income in the return of income is actually share in the firm prior to accounting for the firm s tax and in effect it does not make any difference, as actually the share income from firm is tax free as per the provisions of section 10(2A) of the Act and moreover that amount of ₹ 29,80,754/- has not been credited in the books to invoke the mischief of section 68 of the Act. 12. The ld. CIT(A) re-examined the claim of the assessee in the light of assessee s contentions and being convinced with it he deleted the addition. The relevant observations of the ld. CIT(A) are extracted hereunder for the sake of reference:- Considering the finding given by the AO in assessment order as well as the remand report and written s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... confirm his order on this issue. 15. Apropos ground No.3, it is noticed that the assessee has claimed deduction under section 24 of the Act. The assessee is having two properties namely Flat No.1, Tower-11, Metro City, Paper Mill Compound, Lucknow and Plumeria Homes, Flat No.701-K Tower, Vibhuti Khand, Gomti Nagar, Lucknow. Both the prosperities has claimed as self occupied. In reply dated 5.9.2012, the assessee has claimed property situated at Flat No.1, Tower-11, Metro City, Paper Mill Compound, Lucknow as his residential property and treated as his SOP and the other property situated at Plumeria Homes, Flat No.701-K Tower, Vibhuti Khand, Gomti Nagar, Lucknow is considered for the computation of ALV under section 23 of the Act. The Assessing Officer has considered monthly rent of this property at ₹ 18,000/- considering the area and locality of the property and accordingly calculated the ALV at ₹ 2.16 lakhs and after allowing 30% standard deduction of ₹ 64,800/- and interest on borrowed capital as claimed by the assessee at ₹ 1.50 lakhs, made an addition of ₹ 1,200/- as income from house property. 16. Aggrieved the assessee preferred an appeal b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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