TMI Blog2022 (1) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee were found during the course of search. Further it is submitted that there was no seizure of the jewellery in the course of the search as the jewellery held by the assessee and other family members were within the permissible limit of the CBDT vide Instruction No. 1916 dated 11.05.1994. In such case, no addition can be made. - ITA Nos.3536/AHD/2015 And 136/SRT/2017, IT(SS)A Nos.25 to 29/SRT/2017, IT(SS)A Nos.15 to 19/SRT/2017, IT(SS)A Nos.30 to 34/SRT/2017, IT(SS)A Nos.35 to 39/SRT/2017 - - - Dated:- 24-12-2021 - Shri Pawan Singh, JM And Dr. A.L.Saini, AM For the Assessee : Shri Rasesh Shah, C.A For the Revenue : Shri H. P. Meena, CIT(DR) ORDER PER DR. A. L. SAINI, ACCOUNTANT MEMBER: Captioned twenty two appeals filed by different assessees, pertaining to assessment years (AYs) 2008-09, 2010-11 to 2013-14, are directed against the separate orders passed by the Learned Commissioner of Income Tax(Appeals)-4, Surat [in short the ld. CIT(A) ], which in turn arise out of separate assessment orders passed by the Assessing Officer under section 143(3) r.w.s. 153A of the Income Tax Act, 1961 (hereinafter referred to as the Act ). 2.Since, the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e chart are wrong except to say that assessee`s submission is not acceptable, as the assessee has shown abnormal agricultural income in some years. To substantiate the claim of agricultural income, the assessee submitted the following evidences and documents, which are reproduced below: (a) For Assessment Year 2008-09: The assessee submitted details of agricultural land of family members, vide paper book page No.20. The assessee submitted the statement taken by search team u/s 132(4) of the Act, which is placed at page 21-31 of the paper book. The assessee has submitted for A.Y. 2008-09, the balance-sheet which is placed at page 33 of the paper book, the agricultural income account, vide page no. 35 of the paper book, ledger account of Chalthan Khand Ydhyog Mandali, vide paper book page no.36 and the assessee also submitted cash book for AY 2008-09, which is placed at page no.37 to 38 of assessee`s paper book. (b) For assessment year 2011-12: The assessee submitted before the Bench balance-sheet vide paper book page no.39 to 40. The assessee submitted agricultural income account (PB-41), ledger account of Chalthan Khand Ydhyog Mandali (PB page 49), and cash book vide PB 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee did not file the return of income for assessment years (AYs) 2008-09 and 2010-11 before the date of search. However, for assessment years 2011-12 and 2012-13, the assessee filed the return of income before the date of search. For assessment years, 2013-14 and 2014-15, assessee filed the return of income after the date of search as the time limit for filing the return of income had not expired. In response to notice issued u/s 153A on 18.06.2013, assessee filed the return of all the years. In the original return of income and in the revised return filed u/s 153A, assessee has shown the agricultural income. In the revised return filed u/s 153A for assessment years 2011-12 and 2012-13, the assessee enhanced the agricultural income, as the assessee is not having any source of income other than agricultural income. The assessee declared agricultural income in the return of income filed after the search on the basis of investment and expenditure. Accordingly, agricultural income of particular year does not necessarily represent the agricultural income earned in the same year. The assessing officer disallowed 40% of the cash agricultural income shown in the return filed u/s 153A for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at Para No 7.1 and 7.2 of the appellate order. 16. We note that Ld.CIT(A) has observed in Para 7(i) of appellate order that no breakup of details of land cultivated by each of the members of the assessee and his family members have been kept and made available in either assessment proceedings or in the appellate proceedings. In the connection, ld Counsel submits that all the family members are involved in agricultural operation and they have not got any other source of income then agriculture income and accordingly the issue raised by the Ld.CIT(A) is of no consequence. The learned CIT(A) observed in Para 7(iii) of his order that assessee did not produce any evidence of growing other crops except revenue records. In this connection, ld Counsel submits that assessee sold the other produce in cash and therefore, no evidence was available. However, it is a fact that in the Government records, the other produce grown by the assessee were mentioned and therefore, the evidence cannot be discarded particularly when in the course of the search no evidence was found that assessees and his family members were engaged in other activities than agricultural activities. The CIT(A) has noted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chalthan Sugar Co-operative were found and seized the statement of key members of family i.e. Shri Rajubhai Gijubhai Pate Shri Pankajbhai Gijubhai Patel and Shri Kamleshbhai Dhansukhlal Patel have mostly revolved around agricultural activity. This statement clearly shows that assessee- group is engaged in agricultural activities only. 17. We note that assessee has shown less agricultural income from assessment years 2013-14 and 2014-15, because of urbanization made in certain areas in which the assessee and his family members were holding agriculture land. The ld Counsel submits that there is bound to be variation in the agricultural income due to different factors like monsoon, climate conditions, nature of soil etc., as explained to the AO through various letters. The CIT(A) in Para 7.2 of his order further observed that as per average yield of sugarcane as per Gujarat State Federation of Co-operative Sugar Factory Ltd., very little land was remaining for other cultivation activities. In this connection, ld Counsel submits that CIT(A) has not given the productivity figure of South Gujarat. The average yield of Gujarat cannot be applied for South Gujarat, particularly w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or assessment years 2008-09 and 2010-11, as the time limit for completion of assessment has already expired when the search was conducted for assessment year 2008-09 to assessment year 2010-11. Hence, unless there is any incriminating material found during the course of search relatable to such concluded year, the statute does not confer any power on the ld Assessing Officer to disturb the findings given thereon and income determined thereon, as finality had already been reached thereon, and such proceeding was not pending on the date of search to get itself abated. For this reliance can be placed on the decision of Hon ble Delhi High Court in the case of CIT vs Kabul Chawla reported in (2016) 380 ITR 573 (Del) wherein it was held as follows: '37. On a conspectus of section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is as under: (i) Once a search takes place under section 132 of the Act, notice under section 153A(1) will have to be mandatorily issued to the person searched requiring him to file returns for six AYs immediately preceding the previous year rele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Since no incriminating material was unearthed during the search, no additions could have been made to the income already assessed. 20. We note that assessee family have grown different crops like sugarcane, paddy, juvar, tuver, vegetables etc. and the same being taken on seasonal basis and since all the agricultural activities on different land were carried out together from time to time for a period of whole year. The ld Counsel states that it is not practically possible to maintain details of various different nature of expenses. The assessee has sold the sugarcane to Chaltha Vibhag Khand Sahakari Mandali (Sugar factory). The other products were sold in the open market. The agricultural products are sold by the assessee directly. In respect of crops, the casual labours are employed from time to time as per the requirements and no details are kept for the same. In case of sugarcane and other crops, the assessee had incurred all the expenses out of gross receipt of agricultural income and the assessee had shown net agricultural income. We note that assessee is holding substantial area of agricultural land in the name of himself as well as other family members and he also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rce of income out of which he could have earned the income which is shown by him. In the course of the search no evidence has been found indicating that the assessee group is engaged in any other activities other than agricultural activity. The assessee Shri Rajesh G. Patel, in the statement recorded u/s 131 on 03.07.2013 stated that he has bought 150 to 200 vinghas land. He was earning about ₹ 1,25,00,000/- net agricultural income. In reply to question no 8, he stated that he is selling the sugar cane in Chalthan and Maroli sugar factory and also to private parties. He also stated that he was earning about 15,00,000/- to ₹ 20,00,000/- for sale of other agricultural produce per year. In reply to question no 9, he stated that about 20 workers are employed for agricultural operations. In reply to question no 6, he stated that he is doing agricultural operations also on the lands of other persons. In reply to question no 28, he stated that he had only agricultural income and that is why books of accounts were not maintained. However, after the search, assessee prepared books of accounts and final statements were filed as promised in reply to question no 27. In reply to que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted for assessment years 2008-09 to assessment year 2010-11. Hence, we are not inclined to accept the contention of the Ld CIT(A) in sustaining the addition and enhancing the addition based on surmises and conjectures, and hence the addition so sustained and enhanced are deleted. Hence this ground of the assessee is allowed. 23. We have adjudicated the assessee`s appeal taking lead case in IT(SS)A No.20/SRT/2017, in the case of Pankajbhai Gijubjhai Patel, for assessment year 2008-09. Other appeals of the assessees have identical and similar issues therefore our observations made in IT(SS)A No.20/SRT/2017, in the case of Pankajbhai Gijubjhai Patel, for assessment year 2008-09, shall apply mutatis mutandis to the aforesaid other appeals of assessees. 24. In the result, all appeals filed by assessees are allowed. 6. As the issue of agricultural income and enhancement of agricultural income is squarely covered in favour of the assessee by the decision of Division Bench in assessee s own group cases (supra) and there is no change in facts and law and the Revenue is unable to produce any material to controvert the aforesaid findings of the Division Bench (supra). We find ..... X X X X Extracts X X X X X X X X Extracts X X X X
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