TMI Blog2022 (10) TMI 127X X X X Extracts X X X X X X X X Extracts X X X X ..... ricultural income in the earlier assessment years. It was also not disputed by the Ld.AO in earlier years. It is also noted that the statement recorded U/s. 131 of the Act by M. Rama Rao does not have any evidentiary value and cannot be enforced upon. We also find from the paper book that the assessee has filed a letter from the Sarpanch of Vaddangi Gram Panchayat regarding the planting of Eucalyptus trees in the assessee s lands. The submission of the Ld.AR that harvesting of Eucalyptus trees will take 4 to 5 years cannot be denied. The assessee in his statement has accepted the fact that they used to get Rs. 1 lakh to Rs. 1.5 lakhs per Acre from the agricultural operations. In the sale of agricultural produce viz., Coconut grove, Paddy and Eucalyptus, the receipt of cash is common among agriculturists. We find merit in the arguments of the Ld. AR that assessee has engaged in agricultural activities, not contested by the Revenue, and therefore we are of the considered view, considering the 13 acres of wet and dry lands owned by the assessee, it can be reasonably estimated that the assessee would have earned Rs. 7 lakhs per annum during the impugned assessment year in agricultu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17/JCIT, R-4/VSP/2018-19, dated 12/02/2019 arising out of the order passed U/s. 271D of the Income Tax Act, 1961 [the Act] for the Assessment year 2012-13. 3. Brief facts of the case are that the assessee is a Private Limited Company engaged in the business of real-estate and trading in automobiles. During the financial year 2011-12, the assessee has accepted from its Directors share capital and unsecured loan of Rs. 86,80,000/- in the form of cash as detailed below: Share Capital: 1. Sri D. Dharma Rao 01-02-2012 9,20,000 2. -do- 31-03-2012 10,40,000 Total 19,60,000 1. Sri D. Sashidhar 01-02-2012 8,10,000 2. -do- 15,60,000 Total 23,70,000 Unsecured Loans: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore us the admission of the SLP before the Hon ble Supreme Court in the case of CIT vs. Object Frontier Software (P.) Ltd [2016] 75 taxmann.com 196 (SC). Per contra, the Learned Authorized Representative [Ld. AR] argued that the share capital is neither a deposit nor a loan attracting the provisions of section 269SS of the Act. The Ld. AR further submitted that the unsecured loans were given by the Directors where the current account is maintained by the company in its books of accounts and it is common for the Directors to withdraw and invest from the unsecured loans maintained by the company. The Ld. AR further submitted that the unsecured loans are in the nature of running current account. The Ld. AR also relied on the following case laws: 1. Bhalotia Engineering Works (P) Ltd vs. CIT High Court of Jharkhand [2005] 275 ITR 399 (JHAR). 2. CIT vs. Numero Uno Financial Services Pvt Ltd High court of Delhi ITA No. 857/2011. 3. CIT, Chennai vs. Object Frontier Software (P) Ltd High court of Madras [ 2016] 75 taxmann.com 169 (Madras) 4. CIT, Delhi-IV, vs. I.P. India (P.) Ltd High court of Delhi [2011] 16 taxmann.com 407 (Delhi). 5. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an or deposit. In the case law quoted by the Ld. AR in CIT vs. Idhayam Publications Ltd reported in 285 ITR 221 (supra) the Hon ble Madras High Court observed as follows: We heard the arguments of learned counsel for the revenue. We have perused the materials available in record. Admittedly Mr. S V S Manian was one of the directors. Therefore the order of the lower authority clearly shows that there was a running current account in the books of account of the assessee in the name of Mr. S V S Manian. Mr. S V S Manian used to pay the money in the current account and used to withdraw the money also from the current account. The revenue should establish that what was received by the assessee is a loan or deposit within the meaning of section 269SS. The deposit and the withdrawal of the money from the current account could not be considered as a loan or advance. Further it was also found that the assessee filed a letter dated September 29, 1997, and in that letter he explained that the amount received from Mr. S V S Manian had been shown as unsecured loan from directors in the balance sheet. As per the Companies Act , under the Companies (Acceptance of Deposits) Rules, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is no need to adjudicate the Cross Objection and accordingly it becomes infructuous. 13. In the result, Cross Objection filed by the assessee is dismissed as infructuous. I.T.A. No.36/Viz/2020 (DharmanaChinnaChandrudu) Assessment Year: 2014-15) 14. This appeal filed by the assessee against the order of the Ld. CIT(A)-2, Guntur in appeal No.10427/GNT/CIT(A)-2/2016- 17,Dated 25/11/2019 arising out of the order passed U/s. 143(3)r.w.s 147 of the Income Tax Act, 1961 [the Act]. 15. Brief facts of the case are that the assessee being an individual, a partner of M/s. Dharmana Motors, filed his return of income admitting a taxable income of Rs. 2,65,394/- and agricultural income of Rs. 14,00,000/-. The Ld. AO, based on the deposition made by the family members of the assessee, had reasons to believe that there is income chargeable to tax escaping assessment within the meaning of section 147 of the Act issued a notice U/s. 148 on 22/2/2016 and served on the assessee on the same date. In response to the said notice, the assessee stated that the return of income filed on 19/03/2015 may be treated as return of income filed in compliance of the notice U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 23 to 34 of the paper book showing the details of agricultural lands owned by the assessee. Per contra, the Ld. DR submitted that the statement recorded from Sri M. Rama Rao S/o. Venkata Rao, to whom the assessee claimed to have sold the Eucalyptus trees during the impugned assessment year for Rs. 14 lakhs, stated that he did not purchase any Eucalyptus trees from the assessee. Therefore, the Ld. DR pleaded that it is not the agricultural income earned by the assessee and the Ld. AO has rightly treated the said income as income from unexplained sources. The Ld. DR pleaded that the orders of the Ld. Revenue Authorities be upheld. 18. We have heard both the parties and perused the material available on record and the orders of the Authorities below. Admitted facts are that the assessee owns 4 Acres of Wet Land at Mabagam and 9 Acres of Dry Lands at Bommika and has indulged in agricultural activities in the said lands. This fact was not disputed by the Revenue. The only issue before us is the realization value of the agricultural produce by the assessee during the relevant assessment year. We also see from the paper book submitted by the Ld. AR that the PattadarPass Bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant. The appellant elaborately gave his explanation as regards growing of Eucalyptus Trees in his land and how he had got that kind of income. But the CIT(A)-2, Visakhapatnam, did not accept the said explanation without basis and confirmed the additions made by the Assessing Authority under the head unexplained income . Hence, the appellant prays for relief. 3. The appellant had made certain withdrawals through Citi Bank Debit / Credit Cards to the tune of Rs. 11,56,600/- by paying the amounts to Citi Bank. As the appellant had explained the details up to Rs. 7,52,651/- as the sources up to that extent and produced evidence inspite of long gap of time, the CIT(A)-2 ought to have accepted at least the said amount instead of adding the entire amount of Rs. 11,56,600/-, Rs. 2,65,379/- as he got proper explanation. The Ld. CIT(A)-2, without discussing the issue with any clarity, made the entire expenditure met through Bank Card Account, which is not in accordance with law. Hence, the appellant prays for relief. 4. For these and other grounds that may be urged at the time of appeal hearing, the appellant prays for relief. 22. Ground No.1 raised by the assessee is g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A) s decision is in accordance with law and based on the facts and circumstances of the case and therefore we find no reason to interfere with the of the Ld. CIT(A) on this issue. It is ordered accordingly. Thus, this ground raised by the assessee is dismissed. 25. In the result, appeal filed by the assessee is partly allowed. I.T.A. No. 35/Viz/2020 (Dharmana Dharma Rao) Assessment Year : 2014-15) 26. This appeal filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals)-2, Guntur in appeal No.10379/GNT/CIT(A)-2/2016-17, dated 25/11/2019 arising out of the order passed U/s. 143(3) of the Income Tax Act, 1961 [the Act]. 27. The assessee has raised the following grounds of appeal: 1. The order of the Ld. CIT(A)-2, Guntur is contrary to law and facts of the case. 2. The CIT(A)-2, Guntur ought to have accepted the agricultural income declared by the appellant instead of stating that these were no sale of Eucalyptus trees. 3. The Ld. CIT(A)-2, Guntur instead of confirming the addition made by the Assessing Authority ought to have granted relief by deleting the addition made for the rate purpose by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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