Income Tax Appellate Tribunal - Indore
Rameshchand Shukla, Bhopal vs Assessee on 13 October, 2011
1
IN THE INCOME TAX APPELLATE TRIBUNAL,
INDORE BENCH, INDORE
BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER
AND
SHRI R.C. SHARMA, ACCOUNTANT MEMBER
1. ITA No.564/Ind/2010
A.Y. 2006-07
2. ITA No.565/Ind/2010
A.Y. 2006-07
3. ITA No.566/Ind/2010
A.Y. 2006-07
4. ITA No.567/Ind/2010
A.Y. 2006-07
5. ITA No.568/Ind/2010
A.Y. 2006-07
6. ITA No.569/Ind/2010
A.Y. 2006-07
7. ITA No.570/Ind/2010
A.Y. 2006-07
1. Shri Prakash Shukla
Bhopal
PAN - ACIPS-9732P
2. Smt. Pratimadevi Shukla
Bhopal
PAN - ACIPS-9729E
3. Shri Rameshchand Shukla
Bhopal
PAN - ACIPS-9734M
4. Shri Bharat Shukla
Bhopal
PAN - ACIPS-9733N
2
5. Shri B.L. Shukla
Bhopal
PAN - ACIPS-9732P
6. Smt. Neelam Devi Shuila
Bhopal
PAN - ACIPS-9739G
7. Shri Rajendra Shukla
Bhopal
PAN - ACIPS-9731Q ... Appellants
Vs
Assistant Commissioner of Income Tax
3(1)
Bhopal ... Respondent
Appellants by : Shri R.N. Gupta
Respondent by : Shri Arun Dewan
Date of Hearing : 13.10.2011
Date of Pronouncement : 13.10.2011
O R D E R
PER JOGINDER SINGH These appeals have been filed by different assessees on common grounds. We, therefore, propose to dispose of these appeals by this consolidated order for the sake or convenience. 3 The only grievance raised in these appeals pertains to agricultural income of the amounts as detailed in the grounds of appeals on the plea that learned Commissioner of Income Tax (Appeals) is not justified in not accepting the agricultural income shown by the respective assessees from the land owned and taken on lease from different persons.
2. During hearing of these appeals, we have heard Shri R.N. Gupta, Ld. Counsel for assessee and Shri Arun Dewan, learned Sr. DR. The crux of arguments on behalf of the assessee is identical to the grounds raised in the respective appeals by further submitting that there was approximately 45 acres of land taken on lease. On a query from the Bench as to what lease rent was paid to the land owners, it was explained that agricultural produce equivalent to the amount of Rs. 1,60,000/- was paid to the land owners as lease rent. Our attention was also invited to the decision of the Tribunal in the case of Smt. Samita Binod and Smt. Simi Vishnu (ITA No. 88/Ind/2010) wherein the agricultural income to the extent of Rs. 22,000/- per acre was directed to be accepted. Further 4 attention was invited to the assessment order framed u/s 153A read with section 143(3) of the Act in the case of Shri Mukesh Sharma wherein it was observed by the learned Assessing Officer that an income of Rs. 20,000/- per acre was derived in the assessment year 2003-04 and 2004-05. This assertion of the assessee was not controverted by the revenue. However, the learned Sr. DR contended that it depends upon the area where the land is situated to which the Ld. Counsel for assessee contended that the land in the case of Shri Mukesh Sharma (assessment order) as well as Smt. Samita Binod and Smt. Simi Vishnu (order of the Tribunal) the lands are situated in the area of Bhopal. It was also contended that the facts in all these appeals are identical.
3. We have considered the rival submissions and perused the material available on file. In the case of Shri Prakash Shukla (ITA No. 564/Ind/2010) the facts in brief are that the Assessing Officer disallowed the agricultural income by treating the same as taxable. The stand of the Assessing Officer is that though agricultural income of Rs. 6 lacs has been shown by the 5 assessee but no books of account are maintained by him. The showed agricultural income was also found to be towards higher side. In its return the assessee disclosed agricultural income of Rs. 6 lacs from 57.76 acres of fully irrigated agricultural land. Before learned Commissioner of Income Tax (Appeals) the stand of the assessee is that agricultural activities were duly carried out by the assessee but the same were discarded by the Assessing Officer. It was further claimed that the assessee belongs to an agricultural family and in the past from several years the assessee family is having agricultural income and the same was shown in the returns of respective years. It was further claimed that in past assessment years the agricultural income all along has been accepted. The relevant portion of such claim is summarised as under :-
Assessment Income shown in return Particulars of assessment Area of Remarks year Remarks Agri Land Total Agri. Total Income Agri Income Income Income 2006-07 693230 600000 1373230 0 52.755 Agri.
acre Income Rs.
600000 is
treated as
taxable
income by
the A.O.
6
2005-06 786980 320000 780980 320000 42.47 Order u/s
Acres 143(1)
dated
22.06.2006
- Accepted
2004-05 738240 320000 738240 320000 42.47 Order u/s
Acres 143(1)
dated
8.11.2006 -
Accepted
2003-04 698979 320000 698980 320000 42.47 Order u/s
Acres 143(1)
dated
11.11.2003
- Accepted
2002-03 633270 300000 633270 300000 42.47 Accepted
Acres
2001-02 273513 280000 273513 280000 42.47 Accepted
Acres
The findings of the learned Commissioner of Income Tax (Appeals) are reproduced hereunder :-
" I have gone through the assessment order and submission of the ld. counsel furnished before me along with supporting evidence. The appellant was in possession of agricultural land which is not disputed by the A.O. The assessee has supported the agricultural income by submitting the mandi sale receipt of Krishi Upaj Mandi. Copy of Khasra Nakals of the agricultural land and the koli patta agreements. All these documents have not been doubted and the genuineness has not been disputed. It is not the first year in which the assessee has income shown from agriculture but he has the said source of income in earlier years also in which said income has been accepted. Thus, the disallowance of entire agricultural income shown by the appellant is not justified. During the year the appeal has made sales of agricultural produce at Rs.6,07,783/- and the net income shown is Rs.6,00,000/- on total land at 52.75 acres out of which 7.65 acres is self owned and 45.11 is the land taken on lease. It is noticed from the details filed that the land is irrigated and two crops are grown on thereon. As regards expenses it was contended that majority of the expenses have been incurred in kind by way of crops/grains but the appellant has not furnished details regarding expenses incurred on such agricultural activity. Further, during the assessment proceedings the appellant has also accepted that agricultural income is shown on estimates only. As the appellant has not 7 furnished details and supporting vouchers for expenses incurred along with complete details for the sale proceeds, in these circumstances agricultural income can only be estimated on reasonable basis.
It is pertinent to note that Agricultural income shown by the appellant during the last five years has been accepted by the department. In previous year 2003-04 relevant to A.Y. 2004-05 agricultural income to the extent ofRs. 3,20,000/- was disclosed by the appellant from 42.47 acres of land out of which 7.65 acres was owned by him and 34.82 was taken on lease. The agricultural income shown was Rs. 7,500/- per acre. The agricultural income shown by the appellant was accepted by the A.O. in the assessment completed u/s 143(3) of the Income Tax Act. Since then there is a gap of 2 to 3 years and the yield of crops as well as prices of agricultural proceeds have risen considerably. In view of the same, the agricultural income has increased since then and, therefore, it would be fair and reasonable to estimate agricultural income @ Rs. 8,000/- per acre per annum. As the appellant during the year has cultivated 52.75 land hence net agricultural income estimated @ Rs. 8,000/- per acre which comes to Rs. 4,22,000/-. The balance amount of Rs. 1,78,000/- (Rs. 6,00,000 - Rs. 4,22,000) will be treated as the appellant's income from other sources and will be taxed accordingly."
We are also reproducing hereunder the concluding part of the order of the Tribunal in the case of Smt. Smita Binod (ITA No. 88/Ind/2010) dated 28th March, 2011 :-
The relevant portion of the order of the Tribunal dated 28.3.2011 is reproduced hereunder :-
"8. We have considered the rival contentions, carefully gone through the orders of the authorities below and the detailed chart of production and sale of various produce like wheat, chana, soya, placed on record duly indicating the month of production and also date of sale, rate at which the produce was sood. The assessee had also given detailed break up of the various expenditure incurred for producing 8 these crops which in tital amounted to Rs.
1,99,500/-. Thus, the total nbet income of Rs. 6,21,270/- was shown in respect of land of 18.86 acres in Ratanpur area, Bhopal, yielding average rate of Rs. 33,000/- per acre. The learned Commissioner of Income Tax (Appeals) estimated Rs. 15,000/- per acre. Keeping in view the details furnished by the assessee as narrated by the learned Commissioner of Income Tax (Appeals) in his order which has not been controverted, it would be most reasonable to estimate the income at Rs. 22,000/- per acre of land for computing the agricultural income shown by the assessee with respect to various crops. The Assessing Officer is directed to recomputed the agricultural income by taking the income of Rs.22,000/- per acre of land. We direct accordingly.
9. In the result, the appeal is allowed in part in terms indicated above.
4. If the aforesaid conclusion drawn by the learned Commissioner of Income Tax (Appeals) and the order of the Tribunal are analysed, we find that the learned Commissioner of Income Tax (Appeals) has not disputed growing of crops on the total land at 52.75 acres (7.65 acres owned by the assessee and 45.11 acres taken on lease). The learned appellate Commissioner has estimated the agricultural income per acre at Rs. 8,000/- per acre per annum. Now the question arises whether such estimation is fair and reasonable ? 9 Without coming to any conclusion, the opinion of the department in the case of Shri Mukesh Sharma (supra) wherein the income has been estimated at Rs. 20,000/- per acre and the Tribunal has directed such estimation at Rs. 22,000/- per acre in the case of Smt. Smita Binod (supra). If these estimations are kept in juxtaposition with the facts of the present appeals, we find that for 45.11 acres (taken on lease) the assessee has paid lease rent, therefore, the net agricultural income may be lesser. The assessee in his return has claimed the agricultural land per acre are Rs. 11,521/- from the irrigated land, in our view, which is quite and reasonable, therefore, we direct the learned Assessing Officer to allow the agricultural production at the rate of Rs. 11,521/- per acre. Therefore, the stand of the learned Commissioner of Income Tax (Appeals) is modified to this extent only.
5. Since the identical issues are involved in remaining appeals, therefore, our aforesaid decision will be applicable to these appeals also on the same terms and conditions. 10
6. The next ground pertains to levy of interest u/s 234B and 234D of the Act. In the light of the above decision, the same will be consequential in nature.
All these appeals are disposed of in the aforesaid manner.
Sd sd
(R.C.SHARMA) (JOGINDER SINGH)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated: 13.10.2011
Copy to: Appellant, Respondent, CIT, CIT(A), DR, Guard File Dn/-