TMI Blog2022 (12) TMI 285X X X X Extracts X X X X X X X X Extracts X X X X ..... has been made by the Assessing Officer nor any questions were asked to the assessee nor any information was called for. Therefore, we have no hesitation to hold that the order passed by the Assessing Officer was erroneous and prejudicial to the interest of revenue within the meaning of section 263 of the Act. In view of the above, we do not find any error in the order passed by ld.PCIT. Addition by treating the same as business income as against agricultural income claimed by the assessee - Similarly, for A.Y. 2017-18 the Assessing Officer after elaborate discussion had also concluded that the activities of the assessee do not fall within the realm of Agriculture and had held the amount as business income instead of agricultural income. It was submitted by the ld. AR that the appeals for these two assessment years were filed by the assessee before the ld.CIT(A). We notice that in the present case, a show cause notice was issued on 03.02.2020 i.e., much after passing of these orders for two assessment years u/s 263 and the ld.PCIT had come to conclusion that the assessee is not into agricultural activities. However, the ld.PCIT had thoroughly examined the activities of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peal belatedly. We rely on Case law Collector Land Acquisition Vs. Mst. Katiji Ors, 1987 AIR 1353 (SC) and University of Delhi Vs. Union of India, Civil Appeal No. 9488 9489/2019 dated 17 December, 2019, hold that such a delay; supported by cogent reasons, deserves to be condoned so as to make way for the cause of substantial justice. We accordingly hold that assessee s impugned delay in filing this appeal is neither intentional nor deliberate but due to the circumstances beyond his control. The same stands condoned. Case is now taken up for adjudication on merits. 3. Facts of the case, in brief, are that assessee in individual, who is engaged in the business of production and sale of Tissue Culture Plants, filed his return of income for A.Y. 2015-16 on 15.08.2015 admitting income of Rs.1,05,000/- and agricultural income of Rs.57,16,613/-. The case was selected for scrutiny under CASS to verify the agricultural income claimed by the assessee. Thereafter, notice u/s 143(2) of the Act was issued on 19.09.2016 and served on the assessee. Assessee had furnished the information as called for. After verification of the information, income returned by the assessee was accepted. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the action on the part of the ld.PCIT is incorrect as the activities of the assessee had been examined and further the assessee was into developing of sapling for getting high yield of banana plants. The following submissions were filed by the ld. AR for the assessee. The only question in this appeal is whether cultivation of banana saplings is an agricultural activity or not. For this purpose, it is necessary to consider the stages of growth of banana saplings. The appellant is submitting the photographs of the banana saplings cultivated by the appellant. The stages of cultivation of banana saplings are submitted hereunder. First stage: The first stage is selection of the sucker. The fruit bearing banana trees are grown on the soil and they are the source for the selection. Around such trees, young saplings are obtained. They are grown on the soil. Out of many such saplings only the healthy ones are selected for the purpose of re-planting. This process is evidenced from the photograph No.1 annexed to these submissions. Second stage: After selection of the healthy saplings, they are cleaned carefully. Third stage: The third stage is t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or consumption or for trade or commerce, if they are based on land, would be agricultural products. Here, it is not the case of the revenue that without performing the basic operations, only the subsequent operations, as described in the decision of the Apex Court have been performed by the assessee. If the plants sold by the assessee in pots were the result of the basic operations on the land on expending human skill and labour thereon and it was only after the performance of the basic operations on the land, the resultant product grown on such part thereof as was suitable for being nurtured in a pot, was separated and placed in a pot and nurtured with water and by placing them in the greenhouse or in shade and after performing several operations, such as weeding, watering, manuring etc. they were made ready for sale as plans all these operations would be agricultural operations and all this involves human skill and effort. Thus, the plants sold by the assessee in pots were the result of primary as well as subsequent operations comprehended within the term 'agriculture' and they are clearly the products of agriculture . The Ahmedabad Bench of ITAT in the case of DCIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and prejudicial to the interest of revenue within the meaning of section 263 of the Act. In view of the above, we do not find any error in the order passed by ld.PCIT. 10. Another reason for recording the above said finding is that in the subsequent A.Y. i.e., 2016-17, the Assessing Officer had passed the order on 06.12.2019 and confirmed the addition to an extent of Rs. Rs.70,77,107/- by treating the same as business income as against agricultural income claimed by the assessee. Similarly, for A.Y. 2017-18 the Assessing Officer after elaborate discussion had also concluded that the activities of the assessee do not fall within the realm of Agriculture and had held the amount of Rs.16,71,532/- as business income instead of agricultural income. It was submitted by the ld. AR that the appeals for these two assessment years were filed by the assessee before the ld.CIT(A). We notice that in the present case, a show cause notice was issued on 03.02.2020 i.e., much after passing of these orders for two assessment years u/s 263 and the ld.PCIT had come to conclusion that the assessee is not into agricultural activities. However, the ld.PCIT had thoroughly examined the activitie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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