TMI Blog2016 (8) TMI 915X X X X Extracts X X X X X X X X Extracts X X X X ..... d. But it does not lessen the burden of the assessee to support its stand atleast before the First Appellate Authority. In the instant case, the Ld. CIT(A) categorically observed that even after 4 ½ years the assessee did not furnish even an iota of evidence to contradict the stand taken by the A.O. Though some additional evidence is sought to be produced before the Tribunal, the explanation for not filing the same before CIT(A) was not convincing. Even otherwise the evidence filed along with petition under Rule 29 of I.T. Rules is not sufficient to come to a conclusion that the assessee-firm might have earned agricultural income of such magnitude by farming dry land, that too in F.Y. 2007-08 when certificates of Tahsildars indicate that income would be less than what was declared by assessee. Under these circumstances, do not find any infirmity in the order passed by the CIT(A) and therefore, uphold the order of the CIT(A) and dismiss the appeal filed by the assessee-firm. - ITA.No.1064/Hyd/2015 - - - Dated:- 20-7-2016 - SHRI D. MANMOHAN, VICE PRESIDENT For The Assessee : Mr. Mahesh Kumar Rathi For The Revenue : Mr. B. Kurmi Naidu ORDER This appeal by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n amount of ₹ 15. 00 lakhs should not be disallowed and added to the income of the firm under the head of Income from Other Sources after allowing an amount of ₹ 10,000 per Acre and for total land of Acres 36.18 guntas the amount comes to ₹ 3,62,777. Please explain with documentary evidence at the time of hearing, if you have any objection to the above proposal. 2.1. The assessee was asked to furnish copy of the return of income along with audit report, P L A/c, balance sheet etc., However, none appeared on behalf of the assessee and there is no response either from the A.R. of the assessee or the partners of the firm. Therefore, A.O. had no other alternative except to complete the assessment on the basis of the material available on record. Since the assessee-firm could not prove the source of income, the A.O. allowed a nominal income of ₹ 10,000 per acre which works out to ₹ 3,62,777 and the balance amount of ₹ 15 lakhs out of the total sale proceeds was treated as income shown to have been earned from sale of agricultural produce but it deserves to be treated as Income from other sources . Accordingly, he made addition of ₹ 15 l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aken into consideration by the A.O. It was further contended that one of the partners Mr. M. Mahesh resides at the farm exclusively to take care of agricultural operations, with professional help. It was further submitted that the assessee has no other source of income, apart from agricultural income, and hence the treatment of the impugned receipts under the head Income from other sources is not supported by any evidence. While taxing non-agricultural receipts, provisions of Section 44AD are applicable and the same logic would have been applied even in the case of agricultural income. It was mainly contended that the basic tenets of theory of real income ought to have been taken into consideration since the assessee declared only agricultural income of ₹ 10,76,880 and hence, the case do not call for addition of ₹ 15 lakhs. 4. On behalf of the assessee additional evidence was filed vide letter dated 14.06.2016 wherein the MRO certificates and extracts of pattadar pass books of partners, copies of electricity pass books and photographs of garden were placed. It was submitted that the assessee could not trace this information at the time of hearing before the A.O. or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tten submission dated 14.06.2016 is taken on record. In the paper book filed along with covering letter dated 22.02.2016, the assessee s Counsel filed copy of Acknowledgment Card to prove that the letter addressed by the A.O. to the Managing Partner Mr. Laxmi Narasimha Garden was served on 08.01.2011. This was in support of his contention that the A.O. passed the order without giving a proper opportunity of being heard. In the written submissions filed along with covering letter dated 14.06.2016 the assessee mainly submitted that the A.O. had not given a proper opportunity of being heard, but he failed to furnish any reasons as to why the firm could not produce any evidence atleast before the CIT(A), even after gap of more than 04 years. The plea of the Counsel is that all the partners have entered into a partnership agreement to carry on agricultural activities but the fact remains that the partnership deed do not indicate as to what was the land which was brought to the books of the partnership firm. The Ld. Counsel for the assessee, relied upon the decision of the Apex Court in the case of Dhakeswari Cotton Mills reported in 26 ITR 775 to submit that every person before the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10,000 per acre. He mainly submitted that it is for the assessee-firm to prove that it has earned agricultural income to the tune of ₹ 18 lakhs and in the absence of proving the source of agricultural income the A.O. was justified in estimating the agricultural income and the balance was correctly treated as Income from other sources . There is no dispute that the assessee has declared income and hence, it cannot be said that the assessee has no capacity to earn such income. The only question is the Head of Income. Any income which is not proved as agricultural income is assessable to tax as income from other sources; the A.O, therefore, was justified in treating the same as Income from other sources . 8. I have carefully perused the record. As rightly pointed out by the Ld. D.R. the assessee had sufficient time, atleast before the CIT(A), to prove that it owns agricultural lands and carried on agricultural activity in large scale which could have yielded more than ₹ 18 lakhs income. No evidence whatsoever was furnished either before the A.O. or CIT(A). Even before the Tribunal, no evidence whatsoever was produced. When A.O. pointed out mistakes in the Tak Pattie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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