TaxTMI 
TaxTMI 
TaxTMI 
2019 (11) TMI 1243
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....were completed for assessment years 2006-2007 to 2012-2013. The assessee had declared agricultural income in the return filed by him for Asst.Years 2006-2007 to 2012-2013. The A.O. while completing the assessments u/s 153C of the I.T.Act for Asst.Years 2006-2007 to 2012-2013, disbelieved 50% of agricultural income declared by the assessee in respective assessment years and added back the same as "income from other sources". The relevant finding of the Assessing Officer concerning assessment year 2006-2007 reads as follow:- "Assessee has declared the income from agriculture to the tune of Rs. 27,88,000/- from midland coffee estate, Madikkeri, Karnataka for the A Y 2006-07. In order to find out the actual agricultural income from the above estate enquiries were conducted by the inspectors attached to Deputy Director of Income Tax (lnv), Kozhikode. As per the report submitted by the inspectors proved that the assessee has not maintained correct and true accounts regarding the expenses and income arise out of agricultural activities in estate. As per availed information by the inspectors, the expenses were mostly suppressed and income earned shown as huge amount. Assessee also do n....
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.... in Kedakal, it would be a fair estimate to presume that the agricultural income of the appellant can at best be estimated as Rs. 35,00,000/- per year for the calendar year 2018. The AO is directed to estimate the agricultural income of the appellant by reverse indexing the value of Rs. 35,00,000/- for 2018 to the CII of the relevant AY, to arrive at the net agricultural income of the concerned AYs and the difference in any can be treated as income from other sources." 6. The assessee being aggrieved by the order of the CIT(A), has filed these appeals before the Tribunal. Identical grounds are raised in all the appeals, except for assessment year 2012-2013. For the assessment year 2012-2013, only two issues are raised, namely, (i) the assessment order is barred by limitation; and (ii) on merits, whether the CIT(A) is justified in confirming the addition of 50% of agricultural income returned by the assessee as "income from other sources". The learned AR did not press ground no.2 & 3 for Asst.Years 2006-2007 to 2011-2012 and confined his submissions for all the assessment years only on the above two issues. The assessee has also filed a petition for admission of grounds relating to....
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....tal Representative, on the other hand, strongly supported the orders of the Income-tax Authorities. 9. We have heard the rival submissions and perused the material on record. In all the assessment years concerned, only two issues arise for our consideration, namely, (i) whether the assessment orders are barred by limitation, and (ii) on merits, whether the CIT(A) erred in confirming the addition of 50% of agricultural income returned by the assessee as "income from other sources". 9.1 As regards the assessment orders being time barred, the assessee has filed a petition for admission of additional grounds since these grounds were not raised before the lower authorities. The issue of assessment order being time barred is a pure legal issue which does not require any investigation of new facts. Therefore, in view of the judgment of the Hon'ble Apex Court in the case of National Thermal Power Company Ltd. (supra), we admit the grounds relating to the assessment orders being time barred by limitation and proceed to adjudicate the same. 9.2 Section 153B of the I.T.Act provides for period of limitation for completion of assessment or reassessment u/s 153A / 153C of the I.T.Act. Section....
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....eckons the indexed cost for the same asset based on the index which is notified by the Central Government. The concept of reverse indexation is not prescribed in the Income-tax Act. This method is wholly unsuitable when the yield for a particular year for each type of crop cultivated and its unit price varies from season to season in a year based on many uncertain and unpredictable variables like weather, market demand and supply etc. Therefore, we are of the view that the CIT(A) was not justified in directing that the agricultural income for all assessment years has to be determined on the basis of reverse indexation of income estimated for the calendar year 2018. 9.4 Moreover, the Assessing Officer to assume jurisdiction u/s 153C of the I.T.Act, he has to be satisfied that the documents or material found during the course of search belong to a person other than the searched person. In this case, there is no mention in the assessment order as to what document or valuable were found in the premises of the searched person that belonged to the assessee. In other words, there is no material belonging to the assessee which were unearthed during the search. This is clear from the fact ....