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2016 (6) TMI 591 - ITAT AHMEDABAD

2016 (6) TMI 591 - ITAT AHMEDABAD - TMI - Reopening of assessment - non filing of return - Unexplained investment - Source of income - agriculture income or not - Held that:- The assessee has not been filing the return. In other words, he had never filed return. The AO got information that the assessee has made investment in LIC. The investment was of ₹ 15 lakhs. Once the assessee was not filing the return, then, there is no mechanism with the AO to verify the source of such investment. It .....

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at bills came to the possession of the assessee, because, sugar cane was sold to cooperative sugar mill, where mandatory bills were raised. Otherwise, in rural background, hardly any bills were issued for sale of crop or sale of plants. Possibly, there cannot be any evidence in the possession of the assessee, because, he was not operating in a very large scale in an organized manner. He has produced bank statement for the last three years. In such situation, onus was upon the Revenue to demonstr .....

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en, 16 acres of agriculture land along with running of a nursery, could generate ₹ 15 lakhs over a period of time. The AO ought to have not doubted the stand of the assessee.- Decided in favour of assessee. - ITA No. 68/Ahd/2016 - Dated:- 1-6-2016 - Shri Rajpal Yadav, Judicial Member And Shri Anil Chaturvedi, Accountant Member For the Assessee : Shri Rasesh Shah For the Revenue : Shri B.P.K. Panda, Sr.DR ORDER Per Rajpal Yadav, Judicial Member The assessee is in appeal before us against th .....

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on with regard to the investment in the insurance policies. On the strength of this information, the ld.AO has recorded reason that income chargeable to tax has escaped the assessment. Accordingly, he issued notice upon the assessee under section 148 of the Income Tax Act on 18.3.2014 which was duly served upon the assessee. The ld.counsel for the assessee has submitted that the AO had not possessed any material which can help him to form an opinion that income has escaped assessment. He was har .....

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#8377; 15 lakhs. Once the assessee was not filing the return, then, there is no mechanism with the AO to verify the source of such investment. It can only be verified by inquiring from the assessee, and therefore, he has to issue notice under section 148 of the Income Tax Act. We do not see any error in the reopening of the assessment. Accordingly, this ground of appeal is rejected. 5. In next ground of appeal, grievance of the assessee is that the ld.CIT(A) has erred in confirming the addition .....

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ate to take note of relevant questions and their answers. They read as under: Q.2 Please give the details of your family. Ans: I am living along with my mother, wife and my aunty (father s sister) at Bajat Falia, At & Post. Vankal, Tal. Mangrol, Surat. Q.3 Please give the details of household withdrawals and what was your monthly household withdrawals. Ans: The household expenses are being met by from our withdrawal from bank and from sale of nursery saplings. The monthly household expenses .....

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h is also comes under agriculture income. Q.7 Please give the details of movable/immovable properties held by you? Ans. I am the owner of my house where I am residing at 154/195, Bajat Falia, At & Post. Vankal, Tal. Mangrol,Surat and also I am having 9514 sq. mtr. agricultural land at Vankal jointlyheld with my mother, Madhuben Ishwarlal Desai, brother-Jitendra Ishwarlal Desai and sister - Kalpanaben Desai. I have purchase an agricultural land admeasuring 1203 sq.mtr., Block No.500 and 502 a .....

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., Surendra nursery, Baroda, Baroda Roses nursery, Barods Setaband agency, Baroda. .. Nursery, Adas, Diamond Nagar nursery, Leskhana. Q.9 Whether you have investment in insurance policies, if yes, source of investment in insurance policies ? Ans. Yes. I have taken two single premium insurance policies from SBI life Insurance Co. Ltd., policy numbers 55002975105 and 53001287208 of ₹ 9 lakhs and ₹ 6 lakhs respectively. The source of investment made by my father (expired in 2011) and au .....

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other words, they were holding 80,030 sq.meters of land, roughly 16 acres of land. The assessee was running a nursery in the name of Hanuman Farm from where he has sold saplings. He has never returned income, because, he has no other source of income. He has not made any sale of land in the last six years. The ld.CIT(A) has rejected the contentions of the assessee on the ground that the assessee was not in possession of any evidence exhibiting the agriculture income of this magnitude which can .....

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irmed by the ld.CIT(A). 7. The ld.counsel for the assessee submitted that the assessee has no other source of income. The department cannot lay their hand in other activities of the assessee. Therefore, the stand of the assessee cannot be disbelieved that investment was not made out of agriculture income. 8. On the other hand, the ld.DR relied upon the order of the ld.CIT(A). He contended that the assessee has submitted old bills exhibiting sale of sugar cane. This related to F.Y.2006-07 to 2010 .....

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has alleged that his old father who died in 2011 at the age of 82 was living with him. Similarly, his father s sister i.e. his aunt having age of 89 years, a widow was also living with him. Instead of treating both these old persons as independent earning members, the ld.Revenue authorities ought to have appreciated that the assessee is operating on the agriculture land owned by these two old persons along with his agriculture land. It is to be seen as an independent family unit, where all care .....

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