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of <h1>Tribunal directs correct income classification under section 44AE, favoring assessee</h1> <h3>Koyya Ganga Venkata Satya Bhaskar Rao A.V. Nagaram Versus Income Tax Officer Ward-1 Tuni</h3> Koyya Ganga Venkata Satya Bhaskar Rao A.V. Nagaram Versus Income Tax Officer Ward-1 Tuni - TMI Issues Involved:The judgment involves an appeal against the orders of Commissioner of Income Tax (Appeals) regarding the disallowance of agricultural income and addition under the head 'income from other sources' for the Assessment Year 2017-18.Details of the Judgment:Issue 1: Disallowance of Agricultural IncomeThe assessee, engaged in running a rice mill and transport business, initially declared transportation charges as agricultural income by mistake. The CPC disallowed the agricultural income and added it under 'income from other sources.' The assessee requested rectification, explaining the error and submitted revised income computation. However, the AO did not accept the claim and stated that the tax deducted at source by AP Civil Supplies justified the addition.Issue 2: Appeal Before CIT(A)The assessee appealed before CIT(A), who dismissed the appeal, leading to further appeal before the Tribunal based on the grounds that the CPC erred in computing income from the transport business and that the gross receipts were wrongly reported as agricultural income.Issue 3: Tribunal's DecisionThe Tribunal considered the arguments of both parties and concluded that the assessee did not have agricultural income but earned income from the transport business. As the assessee had only one lorry, section 44AE applied, and the TDS deduction supported this. The Tribunal directed the AO to treat the income as Rs. 90,000 under section 44AE, allowing the appeal.Separate Judgment:The appeal in I.T.A. No.145/Viz/2023 was allowed, directing the AO to treat the income as per section 44AE. However, the appeal in I.T.A.No.146/Viz/2023 was dismissed as withdrawn during the appeal hearing.Conclusion:The Tribunal's decision rectified the erroneous treatment of income, emphasizing the applicability of section 44AE to the transport business income. The judgment highlighted the importance of correct income classification and statutory provisions, ultimately favoring the assessee in this case.
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