Prakashchand Khelchand Agarwal, Pune vs Assessee

Chimanlal Shambhuram Agarwal, Income Tax Officer, Murlidhar Niwas, Plot No. 157, Ward - 8(1), Pune Sector No. 4, PCNTDA, Vs. Moshi, Pune-412105 (Appellant) (Respondent) PAN No. AATPG2098K

ITA No. 329/PN/2013 Assessment Year : 2009-10

Prakashchand Khelchand Agarwal, Income Tax Officer, Murlidhar Niwas, Plot No. 157, Ward - 8(1), Pune Sector No. 4, PCNTDA, Vs. Moshi, Pune-412105 (Appellant) (Respondent) PAN No. AATPG2099J

Revenue By: Shri B.C. Malakar Assessee By: Shri Pramod Shingte

Date of hearing : 01-06-2015 Date of pronouncement : 10-06-2015

ORDER

PER VIKAS AWASTHY, JM:-

The appeals have been filed by the assessees against the order of

Commissioner of Income Tax (Appeals)-V, Pune dated 07-12-2012 for the

assessment year 2009-10 in their respective cases. Since, facts of both

the cases are similar, the appeals are taken up together for adjudication.

For the sake of convenience the facts are taken from ITA No.

328/PN/2013.

2

ITA Nos. 328 & 329/PN/2013, A.Y. 2009-10

2. The brief facts of the case are: The assessee filed his return of

income for the assessment year 2009-10 on 29-03-2010 declaring total

income of Rs.5,67,160/-. The case of the assessee was selected for

scrutiny and notice u/s. 143(2) was issued to the assessee on

18-08-2010. During the course of scrutiny assessment the Assessing

Officer observed cash deposits on various dates total amounting to

Rs.25,87,500/-in the saving bank accounts (Rs.17,83,000/- in Rupee

Co-operative Bank and Rs.8,04,500/- in State Bank of India) of the

assessee during the period relevant to assessment year in appeal. The

assessee was asked to explain the source of cash deposits. The assessee

explained the source of cash deposits as sales proceeds of live stock,

agriculture produce, sale of trees and old household furniture. Not

convinced with the submission of the assessee the Assessing Officer

made addition of Rs.24,10,500/- in the case of assessee in ITA No.

328/PN/2013.

The assessee in ITA No. 329/PN/2013 allegedly received the

amount of Rs.30,27,323/- from his father Shri Khelchand Agarwal. It is

pertinent to mention here that the assessee in ITA No. 328/PN/2013,

Shri Chimanlal Shambhuram Agarwal is the brother of Shri Khelchand

Agarwal. The source of receipts and the explanation furnished for cash

deposit is same as explained in ITA No. 328/PN/2013. The Assessing

Officer made addition of Rs.30,21,450/- in the hands of assessee in ITA

No. 329/PN/2013.

Aggrieved by the assessment orders dated 26-12-2011, the

assessees preferred appeals before the Commissioner of Income Tax

(Appeals) in their respective cases. The Commissioner of Income Tax

(Appeals) after examining the facts of the case rejected the contentions of

the assessees and confirmed the assessment order. 3

ITA Nos. 328 & 329/PN/2013, A.Y. 2009-10

Now, the assessees have come in second appeal before the

Tribunal impugning the findings of the Commissioner of Income Tax

(Appeals).

3. Shri Pramod Shingte appearing on behalf of the assessee

submitted that the assessees were co-owner of agricultural land

measuring 178 Kanals and 14 Marla in Village Karsa Doda, Sub-Tehsil

Nigadh, Distt. Karnal, Haryana. The assessee in ITA No. 328/PN/2013

are four brothers. Both the assessees are closely related to each other.

The assessees migrated to Pune around 10-12 years back. They had

their agricultural land and live stock in their native village. The other

two brothers of the assessee who stayed back were managing the

agricultural land and live stock of the assessees. The assessee decided

to dispose off their joint agricultural property along with live stock.

There were some shesham trees on the agricultural land. The assessees

separately sold standing crop and shesham trees before disposing of

agricultural land. The assessees also sold their live stock. The sale

consideration of agricultural land was transferred in the accounts of the

respective assessees through bank draft. The consideration from sale of

standing crop, shesham trees and live stock were received in cash. The

same were deposited in the saving bank accounts of the respective

assessees. The ld. AR for the assessee further submitted that the

assessee in ITA No. 328/PN/2013 had also sold his old household

furniture at Pune for which he received Rs.1,77,000/-. The authorities

below have only accepted the cash received from sale of old household

goods, despite the fact that confirmation statements of the persons to

whom standing crop, shesham trees and live stock/cattle were sold were

placed on record. The assessee had also placed on record the statement

of Sarpanch of the village in support of his submissions. However, the

authorities below have brushed aside all the evidences produced by the

assessee.

4

ITA Nos. 328 & 329/PN/2013, A.Y. 2009-10

4. On the other hand Shri B.C. Malakar representing the Department

vehemently supported the order of Commissioner of Income Tax

(Appeals). The ld. DR submitted that the evidence produced by the

assessees in the form of statement of Village's Sarpanch and the

statements of the vendees of live stock, shesham trees and crop are self

serving and lack authenticity. The ld. DR further contended that the

assessee has not been able to show from any cogent evidence, the

presence of shesham trees and the crop before the sale of agricultural

land. The ld. DR submitted that the order of the Commissioner of

Income Tax (Appeals) is well reasoned and detailed therefore it should be

sustained.

5. We have heard the submissions made by the representatives of

both the sides and have perused the orders of the authorities below. The

additions in respect of both the assessees have been made on account of

cash deposits in their respective saving bank accounts. In the case of

assessee in ITA No. 328/PN/2013 the cash has been deposited on

various dates in saving bank accounts maintained with Rupee

Co-operative Bank and State Bank of India. In ITA No. 329/PN/2013

the amounts have been credited in the saving bank account of the father

of the assessee. The contention of the ld. AR is that the cash amounts

credited in the saving bank accounts are sale proceeds of standing crop,

shesham trees and live stock. The assessees have allegedly received

cash from following sources:

ITA No. 328/PN/2013

Sale of crop Sale of Sale of live Sale of Total

shesham trees stock household

furniture

Rs.8,86,603/- Rs.10,20,000/- Rs.5,55,000/- Rs.1,77,000/- Rs.26,38,603/-

5 ITA Nos. 328 & 329/PN/2013, A.Y. 2009-10

ITA No. 329/PN/2013

Sale of crop Sale of Sale of live Sale of Total

shesham trees stock household

furniture

Rs.13,99,323/- Rs.10,50,000/- Rs.87,800/- - Rs.25,37,123/-

The assessees have given the name and confirmation letters of the

persons to whom trees, crop and live stock have been sold.

6. We agree with the observations of the authorities below that the

documents furnished by the assessee in support of their contentions are

not full proof and the veracity of the documents furnished is not

established. We find that the Assessing Officer has also not exercised

his jurisdiction to verify the genuineness of the documents produced by

the assessee. In our considered view there were deficiencies on the part

of the assessee as well as Revenue to ascertain the authenticity of the

transactions. The assessee has not placed on record Revenue records

viz. Jamabandi, Khasra Girdwaries etc. to substantiate the presence of

shesham trees, the nature of crop and the extent of crop grown on the

agricultural land jointly held by the assessees and their brothers.

7. As far as live stock is concerned, we do not find force in the

argument of the ld. AR of the assessees. It is an admitted fact that the

assessees have migrated to Pune (Maharashtra) 10-12 years back. It

would be highly improbable that in the absence of the assessees anyone

will take care of live stock for such a long period in the native village.

More so, when the assessees have no intention to return to their roots in

near future, it would be implausible to maintain live stock in native

village. Therefore, we confirm the addition in respect of cash receipts

from the sale of live stock.

6

ITA Nos. 328 & 329/PN/2013, A.Y. 2009-10

8. In the facts of the case, we deem it appropriate to remit the file

back to the Assessing Officer to decide the issue afresh after considering

the relevant documents. The assessee is directed to furnish Revenue

records to show the presence of trees and crop on the agricultural land

jointly owned by the assessees. The Assessing Officer shall also make an

effort to verify authenticity of the documents/statements placed on

record by the assessee in support of his claim. The Assessing Officer

shall decide this issue afresh after affording opportunity of hearing to the

assessee, in accordance with law.

The appeals of the assessees are partly allowed for statistical

purpose in the aforesaid terms.

Order pronounced on Wednesday, the 10th day of June, 2015

at Pune

Sd/- Sd/-

(R.K. PANDA) (VIKAS AWASTHY) ACCOUNTANT MEMBER JUDICIAL MEMBER

Pune, Dated: 10th June, 2015 RK/PS

Copy to

1 Assessee 2 Department 3 The CIT(A)-V, Pune 4 The CIT-V, Pune 5 The DR, ITAT, "B" Bench, Pune. 6 Guard file.

//True Copy//

By Order

Private Secretary, Income Tax Appellate Tribunal, Pune