TaxTMI 
TaxTMI 
2011 (11) TMI 835
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....e assessee filed the returns of income for these assessment years wherein the assessee declared agricultural income as follows: A.Y. Agricultural Income declared (Rs.) 2002-03 38,260 2003-04 29,870 2004-05 60,900 2005-06 40,460 2006-07 24,900 2007-08 31,500 (Addl. ground) 4. The above income which has been declared by the assessee as agricultural income has been treated by the Assessing Officer as income from other sources. According to the learned counsel for the assessee, the assessee is owning the agricultural property which has been purchased on 16.3.2000 from one Mr. Mula Venkatesh Goud and others in the village of Pedda Mangalaram, Moinabad Mandal, Ranga Reddy District situated in Sy. No. 212, 213 and 214 admeasuring about 12 acres 14 guntas. According to the AR, agricultural operations have been carried out in these assessment years and the assessee earned agricultural income and the Assessing Officer without bringing any material contrary to the assessee's claim, treated the agricultural income declared by the assessee as income from other sources. According to the learned counsel for the assessee, Pattadar Pass Book and cert....
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....ities. 6. We have heard both the parties and perused the material available on record. In the present case, though the assessee placed on record before the lower authorities regarding the purchase of property as agricultural land, no material has been placed to show actually carrying out of the agricultural operations. More so, the agricultural income is not supported by sale of agricultural produce. The assessee produced Pattadar Pass Book and certificated issued by the VRO which has been obtained in May, 2010 and it does not indicate on what basis the authorities have certified that agricultural operations were carried on in these assessment years in the impugned land and earned agricultural income. Further, as a matter of fact, the assessee has sub-divided the land into plots and sold to various parties. Though the assessee made a claim that the land was divided into plots for the purpose of growing fruit orchards no evidence has been filed. In spite of this, the assessee had sold the plots. Being so, there is no corroborative evidence placed by the assessee regarding agricultural operations carried on by the assessee, as such we are unable to appreciate the argument of....
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....Pereira [24 SOT 459 (Mum)]. iv) CIT vs. Suresh Chand Goyal [298 ITR 277 (163 Taxman 54) (MP)]. 9. On the other hand, the learned DR submitted that the assessee purchased the land in March, 2000 and immediately in the succeeding year he started selling the land dividing the same into small plots. According to him, the intention of the assessee is to sell plots and earn income that is nothing but business in real estate and earn income and under any stretch of imagination it cannot be considered as sale of agricultural land. 10. We have heard both the parties and perused the material on record. In this case assessee bought the land in March, 2000 about 12 acres by 3 different sale deeds and immediately in the succeeding year started selling the land dividing the same into small plots. Thus the intention of the assessee is to do business in real estate. In spite of this assessee made an argument before us that the intention of the assessee is to carry on the agricultural operations. However, as seen from the earlier para there was no evidence that the land was put for actual agricultural operations. We must see whether a land has been put to use for agriculture purpose ....
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....at the assessee is having enough income to deposit the same into the bank account and treating the deposit as income in addition to treating the agricultural income as non-agricultural income would amount to double addition of the same amount and the same should be avoided. 13. The learned DR relied on the orders of the lower authorities. 14. We have heard both the parties and perused the material available on record. For the assessment year 2006-0-7, the assessee could not explain the source of cheque deposit of Rs. 14,53,600. Being so, the unexplained deposit of cheques into bank account at Rs. 14,53,600 is to be considered as unexplained deposit. Similarly, for the assessment year 2007-08 the assessee could not explain the source of Rs. 7,60,000 and the same has to be considered as unexplained income of the assessee. Similar is the position in respect of the cash deposit in the assessment year 2005-06, 2006-07 and 2007-08 and the peak cash deposit has to be considered as unexplained income of the assessee for these assessment years. This ground of the assessee is dismissed in all these appeals. 15. The next ground in ITA No. 756/Hyd/2011 is with regard to treatment of a....
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....wing payment of Rs. 20 lakhs for purchase for land at Kanakamamidi village and the assessee in course of the assessment proceedings had filed a confirmation letter from D. Mahesh Kumar. In the said letter addressed to DCIT, Central Circle-6, Hyderabad, Sri Mahesh Kumar (PAN: AKLPD9732H) had confirmed that he along with the assessee had proposed to buy agricultural land situated at Kanakamamidi village and paid some advance. Later on due to financial problems, the assessee had not arranged the required fund and all the cheques issued by him were bounced for lack of funds. He had taken over the entire land and paid to the respective farmers. The Assessing Officer has relied on this letter from Mr. Mahesh Kumar and no addition was made in respect of the payment of Rs. 20 lakhs for purchase of land of 16 acres while making the assessment for A.Y. 2005-06. The CIT(A) observed that the said 20 lakhs was paid in respect of lands proposed to be purchased from J. Gal Reddy, J. Chandra Reddy, J. Krishna Reddy, J. Eeswar Reddy, J. Malla Reddy, J. Yadi Reddy and J. Venkata Reddy. However, as per page 68 and 69 of the seized paper A/DSKR/SR/04 the payment of total Rs. 2 lakh was made by t....
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....y of cheque which could not be honoured. Later the entire activity was taken over by Sri Mahesh Kumar. The impugned amounts mentioned above were also put up by Sri Mahesh Kumar. Based on the letter of Sri Mahesh Kumar before the Assessing Officer the Assessing Officer accepted the explanation of the assessee. The Assessing Officer having accepted the explanation of the assessee ought not to have rejected the explanation in respect of transactions pertaining to the same village jointly started with Sri Mahesh Kumar but taken over by him later on. The learned counsel for the assessee drawn attention of the Bench to the evidence at pages 2 to 6 of the Paper Book which show that it is Sri Mahesh Kumar who ultimately purchased the land from Smt. P. Shobharani to whom an amount of Rs. 1,00,000 is stated to have been paid out of assessee's funds. He also drew the attention of the Bench to the sale deed executed by Sri A. Anjaiah to whom the assessee is stated to have paid Rs. 2,00,000 vide receipts at pages 7 and 8 of the Paper Book. Similar is the position with the transaction with Sri P. Ramreddy who is the owner of agricultural lands in contiguous survey Nos. in Kanakamamidi ....
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....the A.Y. 2006-07. The assessee does not dispute the payment as well but states that the said payment has been made from out of the income generated in earlier years. In the absence of any receipt and payment account, it is not possible to verify whether the assessee had sufficient cash balance to meet the payment made. Accordingly, the addition of Rs. 1.5 lakh made by the Assessing Officer is sustained. 26. As regards payment made for purchase of land dated 22.5.2004 and 6.12.2004 aggregating to Rs. 7.5 lakhs, the assessee contended that he has not made any payment for purchase of land at Kanakamamidi village and in fact, the entire activity of purchase of land at Kanakamamidi village was taken over by Sri D. Maehsh Kumar. Apparently, there was another transaction showing payment of Rs. 20 lakhs for purchase of land at Kanakamamidi village and the assessee in course of assessment proceedings had filed a confirmation letter from D. Mahesh Kumar. A copy of the same was filed in the Paper Book in course of the first appellate proceedings. In the said letter addressed to DCIT, Central Circle-6, Hyderabad, Sri Mahesh Kumar has confirmed that he along with the assessee had proposed to....