TaxTMI 
TaxTMI 
2023 (11) TMI 790
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....e evidences particularly when the assessee had complied with directions by filing the proper replies dated 14.3.22 manually & 21.3.22 through portal. 4. That reason given by the PCIT in para 4.4 is not relevant since the company Avyukta Industries Pvt Ltd was in existence in the year under consideration 5. That doubts raised by the PCIT are not based on any evidence. 6. That observations of PCIT in para 4.6 is also wrong by adopting incorrect criteria 7. That considering the facts on record and the legal position, the PCIT is wrong in directing the AO to make addition instead of directing the AO for adjudicating the issue after giving proper opportunity of hearing and considering the material & evidences. which have already been furnished before the PCIT and further evidence which may be furnished by the assessee in support of the claim." 3. The ld counsel of the assessee submitted that the impugned order of ld PCIT u/s 263 of the Income Tax, 1961 is illegal in holding that contract farming agreement was not reliable. The reasons given by her are contrary to facts and law. He further submitted that the Ld. PCIT is also not justified in holding....
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.... being highly perishable was sold from the farm to purchaser directly on lump sum basis to M/s. Avyukta Industries Pvt. Ltd. Drawing our attention towards tenancy agreement with the agriculturist and purchaser agreement with Abyukta Industries Pvt. Ltd the ld counsel submitted that the assessee company has received almost entire payment of purchaser company was made in the ICICI Saving Bank account through account payee cheque or RTGS/ NEFT. Therefore receiving of sale proceed after goods/agricultural produce sold in market cannot be doubted and the AO took a plausible view after taking into consideration on record the relevant said documentary evidence of assessee. The ld counsel, therefore, submitted that the assessment order cannot be alleged as erroneous and prejudicial to the interest of revenue therefore, revisionary order may kindly be quashed or set aside. The ld counsel submitted that the ld PCIT has set aside the scrutiny assessment order dated 04.07.2019 and directed the AO to make addition of Rs. 97,74,720/- under the head "income from other sources" by considering the alleged agricultural income as unexplained which is not only perverse and incorrect but not valid and ....
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....ed for limited scrutiny on the issue of claim of exemption of agricultural income. From the para 1 of the assessment order we note that the AO issued notices u/s 142(1) of the Act along with questionnaire on issued on 06.02.2019 requiring the assessee to furnish certain details/ information regarding his claim of earning exempt agricultural income. In response to said notice issued online through ITBA the assessee responded online from time to time and furnished details and replies to the queries raised by the AO during the assessment proceedings. In Para 2 of the assessment order the AO considered the facts of the case and adjudicated the issue of claim of assessee earning exempt agricultural income. The AO noted that the assessee was engaged in the agricultural operation i.e. growing vegetables carried out on agricultural land, taken on lease from agriculturist through farm business tenancy right. The AO further noted that the entire stock of fresh vegetables was sold from the farm by directly sold to purchaser on lump sum basis to M/s. Avyukta Industries Pvt. Ltd. From the copies of the income tax return along with computation of income, copy of bank statement and various other ....
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....e signature of the parties are on the last page and not on other pages. In this regard the ld counsel submitted that the agreement was made on standard form. Since the case was picked up for limited scrutiny therefore, other deficiencies in the agreement cannot be taken into consideration for alleging the assessment order as erroneous and prejudicial to the interest of the revenue. The ld PCIT in the said second show cause notice also alleging discrepancies in the rent paid deposit on huge cash and transfer to the HUF also alleged that after agreement on 10.04.2016 first purchase was made on 10.05.2016 and vegetables cannot be grown so early. It was also alleged that the AO failed to obtain copy of all bills/ vouchers/ invoices in respect of all purchases against the seeds, insecticides pesticides etc, expenses against manpower employed and water charges and expenses on sale of vegetables. The ld PCIT also alleged that the assessee has declared gross agricultural income Rs. 1,16,27,720/- in the ITR and as per ledger account in the books of M/s. Avyukta Industries Pvt. Ltd total receipts were only Rs. 1,06,27,720/-. 10. The ld Counsel submitted the provision of section 263 can on....
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....uments and revenue records (khasra Khatiyan) of respective agriculturist with whom he entered into lease agreement. The assessee also submitted the details of cultivation operation of agricultural land on grown vegetables four times during FY 2016-17 and copy of agreement with purchaser company as Annexure 5. The assessee also submitted the copy of bank statement showing receipt of sale proceeds of vegetables from the purchaser company through bank through account payee cheque RTGS/ NEFT ledger account statement of purchaser company along with calculation of agricultural income earned during the relevant financial period. 12. In view of the above exercise undertaken by the AO we are compelled to hold that the AO has made sufficient and adequate enquiry on the sole issue under the purview of limited scrutiny and thereafter, accepted the claim of assessee regarding exemption of agricultural income. Thus, we are not in agreement with the conclusion drawn by the Ld. PCIT that the AO has allowed claim of assessee without making any inquiry or verification. On the other hand, as we have noted above the AO has taken a plausible and sustainable view after detailed examination and verifi....