9911796707
TMI Blog2023 (1) TMI 268X X X X Extracts X X X X X X X X Extracts X X X X ..... been estimated, again on the average yield rate and the prices of coconut has been taken on the average rate for the year. We see merit in the contention that the estimation of the agricultural income is done on valid basis and not estimated on adhoc basis. It is also noticed that the assessee has been declaring the agricultural income on estimated basis in earlier years which has not been disputed by the revenue. AO has estimated the agricultural income of the assessee to Rs.36,00,000 and the basis on which this estimate is made is not coming out clearly in the order of the AO and this contention of the assessee has not been looked into by the CIT(A) except for stating that the said estimate is reasonable. When the assessee has submitted the possible evidence for estimating the income, the same cannot be brushed aside without recording any adverse finding. Revenue has not brought anything on record to show that the income estimated and the percentage of expense claimed by the assessee is not correct. AO has also not recorded any supporting to show how the agricultural income is estimated at Rs.36,00,000. Addition made by the AO is purely based on surmise without re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the yield estimated or the market price at which the income was estimated. Without pointing out any adverse factor, the Assessing Officer cannot simply reject the estimate. The Hon. ITAT Mumbai in 2021 (3) TMI 264 in the case of NITTA JATIYA (ACIAS NITAJATIA) Vs. DCIT, Central Charge Range 7(1) Mumbai, at para 5 observed In this case, we note that both of the authorities have failed to discharge their duties properly as none of the parties have brought any substantial material on records to prove that the assesse has incurred expenses over and above what has been stated by the assesse . In our case, no material has been gathered or produced to show that the income estimated by the assessee is inflated or from the land holding and crops cultivated the said income cannot be generated. Again, the Hon. ITAT Surat in 2022(1) TMI 52 Shri Rajeshbhai Gijubhai patel, Shri Pankajbhai Gijubhai Patel Vs. CIT Surat at para 22 observed as follows:- We must hasten to add here that in this case, there is no finding that any of the details supporting the assesse in its return were found to be in correct or erroneous or false . In our case also, nether the Assessing Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he statutory registers required for wage payment to the rubber tappers. For years under consideration the assessee had estimated the agricultural income as per below details - Particulars AY 2012-13 Amount (Rs.) AY 2013-14 Amount (Rs.) Estimated Income from rubber (net of expenses at 25%) 33,23,424.00 26,97,086.00 Estimated Income from Coconut (net of expense at 25%) 11,25,000.00 13,48,704.00 Estimated income from Sale of mattilogs 1,00,000.00 2,00,000.00 Estimated income from Sale of misc. items like Plantain, etc. 2,00.000.00 3,00,000.00 Total Estimated agricultural income 47,48,424.00 45,45,790.00 Agricultural Income offered 45,00,000.00 45,00,000.00 3. The assessee filed the return of income on 30.11.2012 declaring income of Rs.33,48,920/- for Assessment Year 2012-13 and on 15.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ternational Rubber Study Group, 2015. Thus, the assessee contented that the above estimates are in consonance with the income from rubber as per the Rubber Board statistics and the yield from coconut is also based on the basis of the prevailing market prices and yield in Kerala. The assessee had also provided for expenses/ cost of cultivation at 25% of the gross receipts. In the case of rubber and coconut, the cost of cultivation is mainly for fertilizer, irrigation, maintenance and harvesting, as they are long term crops. 8. The AO, proposed to disallow a portion of the agricultural income returned as the assessee had only estimated the income and not based on books of accounts. The AO directed for an inspection to conduct the agricultural activities wherein the actual extent of crops cultivated, nature of rubber trees etc., were obtained by the inspector attached to the AO, who inspected the agricultural holdings and submitted their report. The inspector had also verified the katcha book maintained with regard to the rubber tapping, wages etc. However the AO was of the opinion that these are not enough to justify the huge agricultural income. The AO held that the assessee had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11. The ld AR also submitted that the AO has to take a consistent stand and when, he has accepted the agricultural income for the various years as shown in the table, there was no specific reason for him to disbelieve the assessee and treat part of the agricultural income as Income from Other Sources for the current year. The Ld AR also submitted that the AO has not pointed out any discrepancy or inflation in the yield estimated or the market price at which the income was estimated and without pointing out any adverse factor, the AO cannot simply reject the estimate. In this regard the ld AR relied on following decisions: NITTA JATIYA (ACIAS NITAJATIA) Vs. DCIT, Central Charge Range 7(1) Mumbai, 2021 (3) TMI 264 Shri Rajeshbhai Gijubhai patel, Shri Pankajbhai Gijubhai Patel Vs. CIT Surat 2022(1) TMI 52 12. The ld AR further submitted that in the absence of any evidence to the contrary, the agricultural income estimated and offered by the assesse has to be accepted. The Assessee relies on the decision of the Hon. Gujarat High Court in: Income Tax Officer Vs. Ashwin.D.Metha (HUF) (2014)(12) TMI 1391- GUJARAT HIGH COURT JK. CHOKSHI Versus ACIT - 2015 (1) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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