TaxTMI 
TaxTMI 
2022 (10) TMI 127
X X X X Extracts X X X X
X X X X Extracts X X X X
....vely. In all these appeals, the assessees are connected to each other and some of the issues raised in their respective appeals are identical. Therefore, considering the connectivity of the appeals with respect to the issues involved as well as the assessees, all these appeals are clubbed, heard together and disposed off in this consolidated order. Appeal wise adjudication is given in the following paragraphs of this order. I.T.A. No.414/Viz/2019 (AY: 2012-13) (By Revenue) 2. This appeal filed by the Revenue against the order of the Learned Commissioner of Income Tax (Appeals)-2, Visakhapatnam [Ld. CIT(A)] in ITA No.10179/2016-17/JCIT, R-4/VSP/2018-19, dated 12/02/2019 arising out of the order passed U/s. 271D of the Income Tax Act, 1961 [the Act] for the Assessment year 2012-13. 3. Brief facts of the case are that the assessee is a Private Limited Company engaged in the business of real-estate and trading in automobiles. During the financial year 2011-12, the assessee has accepted from its Directors share capital and unsecured loan of Rs. 86,80,000/- in the form of cash as detailed below: Share Capital: 1. Sri D. Dharma Rao 01-02-2012 9,20,000 2. -do- 31-03-2012 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....pany. The Ld. AR further submitted that the unsecured loans are in the nature of running current account. The Ld. AR also relied on the following case laws: 1. Bhalotia Engineering Works (P) Ltd vs. CIT - High Court of Jharkhand [2005] 275 ITR 399 (JHAR). 2. CIT vs. Numero Uno Financial Services Pvt Ltd - High court of Delhi - ITA No. 857/2011. 3. CIT, Chennai vs. Object Frontier Software (P) Ltd - High court of Madras [ 2016] 75 taxmann.com 169 (Madras) 4. CIT, Delhi-IV, vs. I.P. India (P.) Ltd - High court of Delhi - [2011] 16 taxmann.com 407 (Delhi). 5. CIT vs. Rugmini Ram Ragavd Spinners (P.) Ltd. - High Court of Madras - [2008] 304 ITR 417 (Madras). 6. CIT, Tamilnadu-1, Madras vs. M/s. Idhayam Publications Limited - High Court of Madras - [2006] 285 ITR 221. 7. CIT vs. Shree Ambica Flour Mills Corporation - High Court of Gujarat [2008] 6 DTR (Guj) 169. 8. Department of Income Tax vs. M/s. Bhandari Precision Forgings - ITAT Bangalore - ITA Nos. 777 & 778/Bang/2010. 9. Assistant Director of Inspection vs. Kum. A.B. Shanthi - Supreme Court of India - [2002] 122 Taxman 574 (SC). 10. Chamundi Granites (P.) Ltd vs. Deputy Commissioner of Income Tax - High Court o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....received by the assessee is a loan or deposit within the meaning of section 269SS. The deposit and the withdrawal of the money from the current account could not be considered as a loan or advance. Further it was also found that the assessee filed a letter dated September 29, 1997, and in that letter he explained that the amount received from Mr. S V S Manian had been shown as "unsecured loan from directors" in the balance sheet. As per the Companies Act, under the Companies (Acceptance of Deposits) Rules, 1975, under rule 2(b)(ix), deposit does not include any amount received from a director or a shareholder of a private limited company. Therefore, the transaction between the appellant and the director cum shareholder is not a loan or deposit and it is only a current account in nature and no interest is being charged for the above transaction. In the foregoing conclusions, we are of the view that since the said transaction does not fall within the meaning of loan or advance, there is no violation of section 269SS of the Income-tax Act. We find no error in the order of the Tribunal and the same requires no interference. Hence, no substantial question of law arises for consideration....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ased on the deposition made by the family members of the assessee, had reasons to believe that there is income chargeable to tax escaping assessment within the meaning of section 147 of the Act issued a notice U/s. 148 on 22/2/2016 and served on the assessee on the same date. In response to the said notice, the assessee stated that the return of income filed on 19/03/2015 may be treated as return of income filed in compliance of the notice U/s. 148 of the Act. Subsequently, statutory notices U/s. 143(2) and 142(1) were issued and served on 4/4/2016. In response, the Assessee's Representative furnished the information called for by the Ld. AO. After examining the submission made by the Assessee's Representative regarding the admission of agricultural income of Rs. 14 lakhs, the Ld. AO being not convinced with the reply, assessed the income of Rs. 14 lakhs from unexplained sources. The Ld. AO also rejected the telescoping benefit requested by the assessee where the income of the firm M/s. Dharmana Motors in which the assessee is a partner offered income subsequent to a survey U/s. 133A of the Act for Rs. 28 lakhs. Aggrieved by the order of the Ld. AO, the assessee filed an appeal bef....
X X X X Extracts X X X X
X X X X Extracts X X X X
....facts are that the assessee owns 4 ½ Acres of Wet Land at Mabagam and 9 Acres of Dry Lands at Bommika and has indulged in agricultural activities in the said lands. This fact was not disputed by the Revenue. The only issue before us is the realization value of the agricultural produce by the assessee during the relevant assessment year. We also see from the paper book submitted by the Ld. AR that the PattadarPass Book and Adangal / Pahani reveal the agricultural lands owned by the assessee. Further, it is noted from the paper book that the assessee has been regularly admitting the agricultural income in the earlier assessment years. It was also not disputed by the Ld.AO in earlier years. It is also noted that the statement recorded U/s. 131 of the Act by M. Rama Rao does not have any evidentiary value and cannot be enforced upon. We also find from the paper book that the assessee has filed a letter from the Sarpanch of Vaddangi Gram Panchayat regarding the planting of Eucalyptus trees in the assessee's lands. The submission of the Ld.AR that harvesting of Eucalyptus trees will take 4 to 5 years cannot be denied. The assessee in his statement has accepted the fact that they u....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he got proper explanation. The Ld. CIT(A)-2, without discussing the issue with any clarity, made the entire expenditure met through Bank Card Account, which is not in accordance with law. Hence, the appellant prays for relief. 4. For these and other grounds that may be urged at the time of appeal hearing, the appellant prays for relief." 22. Ground No.1 raised by the assessee is general in nature and therefore need not be adjudicated. 23. Ground No.2 relates to the addition of Rs.23,80,085/- by disallowing the agricultural income claimed by the assessee at Rs. 24,00,500/-. The Ld AO allowed a sum of Rs 20415/- from sale of coconut and bananas but disallowed a sum of Rs 23,80,085/- from sale of Eucalyptus. The Ld. AO treated the amount of Rs. 23,80,085/- as income from unexplained sources against the assessee's claim of agricultural income for Rs 24,00,500/-. On appeal, the Ld. CIT(A) confirmed the same. This issue is identical to that of the one raised by the assessee in the case of DharmanaChinnaChandrudu in ITA No.36/Viz/2020 for the AY 2014-15. While adjudicating this issue in the case of DharmanaChinnaChandrudu we have gone through the material available before us, orders o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....CIT(A)-2, Guntur ought to have accepted the agricultural income declared by the appellant instead of stating that these were no sale of Eucalyptus trees. 3. The Ld. CIT(A)-2, Guntur instead of confirming the addition made by the Assessing Authority ought to have granted relief by deleting the addition made for the rate purpose by the Assessing Authority. Hence, the appellant prays for relief. 4. The Ld. CIT(A)-2, Guntur ought to have accepted the agricultural income of Rs. 24,25,000/- instead of considering only 3,24,330/- and treated the balance as income from other sources. Hence, the appellant prays for relief. 5. For these and other grounds that may be urged at the time of appeal hearing, the appellant prays for relief." 28. The core issue involved in this appeal relates to the addition of Rs.19,20,670/- as income from unexplained sources. The agricultural income claimed by the assessee in the return of income filed by the assessee is Rs. 24,25,000/-. The agricultural income admitted by the assessee during assessment proceedings is Rs. 22,45,000/-. The Ld. AO therefore, treated the difference amount of Rs. 19,20,670/- as income from unexplained sources against the assess....