The Delhi bench of the Income Tax Appellate Tribunal (ITAT) deleted the addition of Rs.16.4 lakhs after the taxpayer provided a proper explanation and documentary evidence for their agricultural income
The assessee filed its original return of income showing total income at Rs. 4, 95,070/-. As per AIR information, the assessee made a cash deposit of Rs. 19,80,000/- during the Financial Year 2010-11 in the saving bank account. The assessee has been called to furnish certain details/information with regard to the said cash deposits. The case was reopened under Section 147 of the Income Tax Act, 1961 and a notice under Section 148 of the Income Tax Act was issued. In response to the notice under Section 148 of the Income Tax Act, no return of income was furnished.
An order under Section 143(3)/147 was passed on 23/10/2018 assessing the income of the assessee at Rs. 22,52,489/- by making addition of Rs. 16,45,000/- on account of unexplained cash deposit and Rs. 1,12,419/- account of undisclosed interest from bank. The assessee preferred an Appeal before the CIT (A). The CIT (A) vide order dated 12/06/2023 gave relief of Rs. 2, 00,000/- and Rs. 1,04, 065/- and confirmed the balance addition of Rs. 14,53,354/-.
Mr. Ved Jain, representing the assessee submitted that the assessee produced detailed explanation about the source of availability of cash and in support of the same, details of agriculture land held by each one of them and also filed the affidavits from the buyer of the agriculture produce. The assessee has also produced registered sale deed and the detailed explanation about the cash being kept with him and his wife for the purpose of medical reasons since the wife of the assessee was suffering from dementia, but the CIT (A) arbitrarily rejected the explanation given by the assessee and brushed aside the documentary evidence produced by the Assessee without controverting the same.
The assessee has provided proper explanation and documentary evidence regarding agriculture income. Considering the land holdings of the assessee and his children, affidavit of the persons who have carried out the agriculture operation and the Affidavits of the persons purchased the agriculture produce, should have been considered and the CIT (A) and should have deleted the addition.
The two member bench of the tribunal comprising S. Rifafur Rahman (Accountant member) and Yogesh Kumar U.S (Judicial member) found merit in the Grounds of appeal of the assessee, accordingly, the additions made by the A.O. which was confirmed by the CIT (A) was hereby deleted and the Grounds of Appeal of the assessee were allowed.
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