Failure to Produce Evidence as to Astronomical Agricultural Income: ITAT upholds Estimation of Income by AO as Other Source [Read Order]

The Hyderabad Bench of Income Tax Appellate Tribunal (ITAT) has upheld the estimation of Income by the Assessing Officer as income from other sources as the assessee had failed to produce the evidence as to agricultural income.

The assessee Gopal Agarwal Secunderabad was an individual who derives income from salary, house property and other sources. He filed his return declaring total income and agricultural income.

The case was selected for scrutiny and during the course of assessment proceedings, from the details furnished by the assessee, the Assessing Officer noted that the assessee had owned 4.3 acres of land and that his son Mayur owns another 3.5 acres of land.

It was claimed by the assessee that paddy was grown in this land and that there are teak wood trees adjacent to the agricultural land which were sold. It was accordingly claimed that the assessee had earned agricultural income. However, no proof of sale of agricultural produce was furnished.

The Assessing Officer noted that the assessee has claimed income from sale of paddy from a land holding of around 8 acres. According to the Assessing Officer, earning such huge income from 8 acres of land was unbelievable. He therefore, estimated such income and so far as the income from teak wood trees which were grown on the boundaries and sold was concerned, the same was rejected by the AO in absence of supporting evidence.

The Assessing Officer accordingly determined the total agricultural income and made the balance addition treating the same as income from other sources.

C.P. Ramaswami appeared on behalf of the assessee and Rajendra Kumar appeared on behalf of the revenue

The Bench noted that the income shown from agriculture was astronomical but there was no evidence of purchase of seeds/fertilisers. There was no evidence regarding receipt of amounts pertaining to sales of paddy and teak wood also. Such evidence was neither produced during the assessment proceedings nor during the appellate proceedings.

The two-member Bench of R.K. Panda, (Accountant Member) Laliet Kumar, (Judicial Member) upheld the decision of treating some income under the head of other sources.

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