TMI Blog2023 (11) TMI 984X X X X Extracts X X X X X X X X Extracts X X X X ..... though there might be some agricultural income from that agricultural land. But examining only the revenue documents as submitted by the assessee it cannot be said that there was an income to the assessee during that relevant assessment year. By furnishing the land revenue record, the assessee has only proved that the land is an agricultural land. The assessee in order to prove the agricultural income had to furnish evidence regarding sale of agricultural products which was ignored by the Ld. AO. Hence, we agree to the finding of the learned PCIT that the ld. AO did not make any enquiry on the agricultural income as was claimed by the assessee. Accordingly, we decide this ground of appeal against the assessee. Sundry Creditors the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Learned Principal Commissioner of Income Tax, Madurai-1 [hereinafter PCIT ] dated 05-05-2020 and pertains to Assessment Year [AY] 2015-16. The assessee raised following grounds of appeal: 1. The impugned order is illegal, opposed to the facts, contrary to law, without jurisdiction and against the principles of natural justice and therefore liable to be quashed. 2. Because the assessee filed copies of returns of his son Mr. Ragul for AYs 2014-15 and 2015-16 before the PCIT-1. 3. Because the remaining sundry creditors including Rs. 93,00,000/- in the Bricks Unit and Rs. 1,12,03,358/- in KK M Blue Metals unit are old balances of running accounts and not relating to this year and the details for Rs. 1,12,03,358/- were fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 143(2) was issued on 26-07-2016 to the assessee which was duly served upon the assessee. The issues for examination were (i) Agricultural income, (ii) Sales Turnover Mismatch and (iii) Sundry Creditors. The assessee in response to the notice appeared and filed the details called for. The Ld. Assessing Officer [AO] considered the details and completed the assessment. The Ld. AO vide order dated 22-09-2017 only observed that the assessee had not deducted TDS on Audit Fees of Rs. 70,000/-. Accordingly, 30% of the amount (i.e Rs. 21,000/- is disallowed under section 40(a)(ia) of the Income Tax Act, 1961 [the Act] and the same was added to the total income of the assessee. 4. The case has been taken up for revision proceedings under sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s follows: Ragul (Son of the assessee) 51,98, 944 Sundry Creditors in Bricks Units 93,00,000 Sundry Creditors in KKM Blue Metals 1,14,82,120 Mr. Ragul is son of the assessee. He was having fixed deposit with Tamilnadu Mercantile Bank. On maturity of Fixed Deposit during this assessment year 2015-16, the proceeds of the same Rs. 51,98,944/- was given to the assessee for his business purposes. Copies of the Income Tax acknowledgement of Mr. Ragul for the assessment year 2014-15 and 2015-16 is enclosed. The assessee has offered Rs. 1,12,03,358/- out of the Sundry Creditors as income under Income Declaration Scheme 2016 (IDS2016) Copy of Form No. 4 under IDS 2016 is encl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Creditors. The assessee also failed to verify the details of machineries worth Rs. 10 Crores and its utilization for the assessee s business Blue Metals. 8. Heard the representatives of both the parties and perused the materials on record. Before us the Ld. AR reiterated the submissions made before the Ld. PCIT. Per contra, the Ld. DR supported the order of the Ld. PCIT. We have carefully considered the submissions of both the parties and perused the materials on record. We observe that the assessee in order to prove the agricultural income of Rs. 40,00,000/- furnished the Land Revenue records of the State Government which indicates that the land is an agricultural land. The revenue earned from the agricultural land was the agricultura ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cide this ground of appeal against the assessee. 9. Regarding the matter of Sundry Creditors, the assessee only disclosed the name and relation of Mr. Ragul who is one of the sundry creditors. No PAN, confirmation letters, address of the creditors, their creditworthiness were insisted / obtained by the ld. AO during the assessment proceeding. As the assessee borrowed money from some of the persons, the Ld. AO ought to enquire about the creditworthiness of the creditors. He ought to see whether the creditors confirm the credits given by them to the assessee. No such exercise was done by the Ld. AO. Therefore, we are of the view that the Ld. PCIT has rightly observed that the Ld. AO had to obtain the PAN, confirmation letters, addresses, c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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