TaxTMI 
TaxTMI 
2025 (6) TMI 472
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....ONATION OF DELAY 1, Roshan Lal, humbly submit this request for condonation of delay in filing my appeal (Form 36) before the Hon'ble Income Tax Appellate Tribunal, Jaipur. The appeal pertains to the assessment year [AY 2014-15]. Regrettably, I was unable to file the enclosures with the Form 36 within the prescribed time limit due to unavoidable circumstances. The delay of 26 days was caused by unawareness about the filling procedures the Form 36 was filed on time but due to some technical issue enclosure to the FORM 36 were not uploaded. I assure the Hon'ble Tribunal that the delay was not deliberate or due to any negligence on my part. It was purely due to reasons beyond my control, and I have acted promptly to file the enclosures as soon as the circumstances permitted. I firmly believe that my case has merit, and if the delay is condoned, it would enable me to pursue my rightful remedies and obtain justice. I respectfully submit that condoning the delay would not cause any prejudice to the revenue authorities. In light of the above, I kindly request the Hon'ble Tribunal to condone the delay in filing my appeal and accept it....
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....s/documents This notice too remained un-complied with. Since, the notices, issued to the assessee, remained un-complied with, therefore, a final opportunity was given to the assessee by issuing a notice u/s 142(1) dated 14/9/2021, requiring the assessee to show-cause as to why the case should not be completed ex-parte u/s 144. But, this notice too remained un complied with till date. Since, plenty of opportunities were given to the assessee but the assessee did not come forward to submit his submission in respect of various notices issued to the assessee, in these circumstances ld. AO left with no other option but to complete the assessment proceedings ex-parte u/s 144 of the Act. While doing so ld. AO made an addition of Rs. 94,50,000/- as the assessee failed to furnish the documentary evidences in respect of sources of cash deposits as unexplained money u/s 69A r.w.s. 1158BE, into total income of the assessee. 7. Aggrieved from that order of assessment the assessee preferred an appeal before the ld. CIT(A). Apropos to the grounds so raised the relevant finding of the ld. CIT(A) is reiterated here in below: 3. Observations, Finding and Decision: 3.1 I have per....
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....ips have held that: "The appeal does not mean merely filing of the appeal but effectively pursuing it." (b) In the case of Estate of Late Tukojirao Holkar vs CWT, 223 ITR 480 (MP) the Hon'ble High court while dismissing the reference made at the instance of the assessee in default made following observation in their order. "If the party, at whose instance the reference is made, fails to appear at the hearing, or fails in taking steps for preparation of the paper books so as to enable hearing of the reference, the court is not bound to answer the reference." (c) In the case of Commissioner of Income-tax vs Multiplan India (P) Ltd. 38 ITD 320(Del), the appeal filed by the revenue before the Tribunal, which was fixed for hearing, but on the date of hearing nobody represented the revenue/appellant nor any communication for adjournment was received. There was no communication or information as to why the revenue chose to remain absent on that date. The Tribunal on the basis of inherent powers, treated the appeal filed by the revenue as un admitted in view of the provisions of Rule 19 of the Appellate Tribunal Rules, 1963. (d) Further, the....
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....exchanged. 5. Upon receiving the sale proceeds, the Appellant, acting in good faith, deposited the entire amount in his bank account, as evidenced by bank statements establishing a clear and direct correlation between the sale transaction and the deposit. The deposit was made purely for safekeeping, as the Appellant had no prior experience handling large sums of cash. There was no element of concealment, manipulation, or tax evasion in this transaction. 6. The deposits were made as follows: * Rs.9,00,000/- on 22.08.2013 (received as advance/Bayana). * Rs.61,00,000/- on 02.09.2013 (on the date of the sale agreement). * Rs.20,00,000/- on 09.09.2013 (via cheque upon handover of possession). * The balance amount was kept in hand and later utilized on 01.10.2013. 7. The deposit of the majority of the sale proceeds on the very same date as the sale agreement clearly establishes that the payments were received by the Appellant for the sale of land. 8. The Appellant's case was selected for scrutiny under Section 143(3) of the Income Tax Act, 1961. However, due to his complete lack of familiarity with tax laws and proce....
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....a total consideration of Rs.95,00,000/-. As the land in question does not qualify as a capital asset under Section 2(14) of the Act, the appellant, being a layperson with limited financial literacy and no prior knowledge of tax laws, genuinely believed that the transaction was entirely tax-exempt. Accordingly, he did not file an ITR for the said year, under the bona fide belief that no tax liability arose from the transaction. 3. The Assessee's non-filing of the Income Tax Return (ITR) for the Assessment Year 2013-14 was purely unintentional and arose solely from his genuine belief that the sale of rural agricultural land was not taxable. Being a senior citizen engaged exclusively in agricultural activities, the appellant had no prior exposure to taxation laws and was unaware of any requirement to report the transaction. He had never filed an ITR or had any knowledge about the ITR. 4. There was no element of concealment or tax evasion, as the entire sale consideration was received and transparently deposited in the appellant bank account. Given his age, rural background, and limited financial literacy, the appellant acted under the bona fide impression that no tax....
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....ot be passed. However, due to continued lack of awareness regarding the assessment proceedings, the Appellant was unable to respond. Consequently, the Learned Assessing Officer proceeded with an ex-parte assessment under Section 144, without considering the Appellant's genuine position or affording him a reasonable opportunity to explain the source of his funds. 12. In the absence of any response, the Learned Assessing Officer arbitrarily treated the entire credit amount in the Appellant's bank account as unexplained money under Section 69A read with Section 115BBE. The total sum was erroneously added to the Appellant's taxable income, despite the fact that the deposited amounts were directly linked to the sale of rural agricultural land, a transaction explicitly exempt from taxation under the Act. 13. As a consequence of the ex-parte assessment, an unwarranted tax demand of Rs.52,59,180/- was raised against the Appellant. Furthermore, penalty proceedings under Sections 271(1)(b), 271(1)(c), and 271F were initiated, along with the levy of interest under Sections 234A and 234B. The additions and penalties were imposed without conducting a proper inquiry into the na....
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.... of income. 20. In light of the above facts and legal contentions, the Appellant, with utmost humility and respect, prays before this Hon'ble Tribunal to graciously allow the present appeal in the interest of substantial justice and equity. It is submitted that the assessment order, having been passed in a wholly ex-parte manner without affording the Appellant an opportunity to present his case, is unsustainable both on legal and factual grounds. The Appellant seeks relief against the unwarranted additions, penalties, and interest imposed upon him, and respectfully urges this Hon'ble Tribunal to adjudicate the matter in the spirit of fairness, justice, and good conscience. Submission Details: Being aggrieved by the said order of the AO, please find below the ground-wise written submissions for your kind perusal: Ground No. 1- The Ld. Assessing Officer has erred in treating the sale proceeds from the sale of rural agricultural land of Rs. 94,50,000/- as income u/s 69A r.w.s. section 115BBE. 1.1. As stated in the facts mentioned above, the appellant is a senior citizen and a dedicated farmer who has been engaged in agriculture for several ....
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....of imagination can be referred to as the income of the Assessee and hence the said addition in view of the discussions held supra needs to be set aside and the order of the AO needs to be repudiated. 2. Ground No. 2- The Ld. Assessing Officer has failed to provide natural justice by treating an exempt income as income U/s 69A r.w.s Section 115BBE. 3. Ground No. 3- The Assessing Officer has erred in adding the amount of Rs. 94,50,000/- under section 69 without any justified reason of adding it as income u/s 69. 4. Ground No. 4- The order passed is bad in law and fails to provide natural justice to the Appellant. 4.1. The discussions held supra and in ground no 1 will hold good and in continuation to the same, the appellant has explained the deposit of cash and cheque amount by vehemently arguing that the same has been generated out of sale of rural agricultural land during the financial year 2013-14 and the appellant has stated that the same are the sale proceeds of the rural agricultural land and is also now submitting the sale agreement and bank statements for substantiating his claims. 4.2. The assessee would also like to place on reco....
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.... unexplained money, thus, cannot be just simply made and the AO has done this by taking a very casual approach on mere conjectures. 4.10. Further, the appellant has produced contemporaneous documentation i.e. sale deed of land executed on 02.09.13 and the amount of Rs. 61,00,000/- deposited on the very same day establishes the source was from the sale proceeds of the land only. 4.11. The appellant had also demonstrated that there was a direct correlation of sale of agricultural land and deposits/credits in his bank account as the timeline of both the events are aligned. 4.12. The appellant had no malafide intention to hide any transactions but being a laymen unaware of the procedure of Assessment and Appeal, he had no idea about the pendency of notices which remained unresponsive during the course of assessment and appeal to the Hon. CIT(A). 5. Ground No. 5- The Assessing Officer proceedings has erred in law and facts of the case in initiating the penalty proceedings under section 271(1)(b), 271(1)(c) and 271F. 6. Ground No. 6- The Appellant herein craves its right to alter, amend, modify, add or withdraw any ground of appeal and or take....
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....f ten thousand rupees for each such failure." This section provides for a penalty of Rs.10,000 per default if a taxpayer fails to comply with notices issued under Sections 142(1), 143(2), or 142(2A) without reasonable cause. (2) The notices referred to above were never received by the appellant, and he had no knowledge of the ongoing proceedings, which is why the notices remained uncomplied with. The appellant, being a complete layman with very limited literacy and residing in a remote village, was entirely unaware of the notices and the requirement to comply with them. There was no malafide intention to ignore or evade compliance. In the absence of any deliberate noncompliance, there is no justification for initiating a penalty under Section 271(1)(b) of the Income Tax Act. 2.5. Here are the exact provisions of Section 271(1)(c) and Section 271F of the Income Tax Act, 1961: 2.5.1 Section 271(1)(c) - Penalty for Concealment of Income or Furnishing Inaccurate Particulars "271. (1) If the Assessing Officer or the Commissioner (Appeals) or the Principal Commissioner or Commissioner in the course of any proceedings under this Act is satisfie....
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.... knowledge and guidance. * In light of the above, the imposition of penalties under Sections 271(1)(c) and 271F is completely unwarranted, as the appellant had no intent to conceal income, misreport particulars, or willfully evade tax. The transaction is fully explainable, and any procedural lapse occurred solely due to his limited understanding of taxation laws 3. Undoubtedly, the assessment order is unreasonably high pitched as the assessed income under the impugned order is just added on mere conjuctures. The appellant is confident that the appellant has explained the source before your goodself so that the impugned order could be nullified, set-aside. 3.1. The appellant is also striving hard with bad health being a 74 year old individual who has dedicated his whole life to agricultural. 3.2. What is relevant here to note is that income is disclosed or undisclosed and explained or unexplained, then said income shall be dealt in the manner provided under the Act. 3.3. If income is disclosed and explained then same normally would be taxable in ordinary manner. In the actual case of the appellant the amount deposited in the bank are from....
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....ural transactions, especially in rural areas, are frequently conducted in cash, and the mere deposit of such cash in a bank does not make it taxable. The ITAT also observed that the AO failed to provide any concrete evidence proving that the deposit was from undisclosed sources. As a result, the addition under Section 69A was deleted, and the penalty under Section 271(1)(c) was deemed unjustified since there was no deliberate attempt to conceal income. The ruling reaffirmed that agricultural income remains taxfree, and its deposit into a bank account does not change its nature or make it liable for taxation. 2. Vinaya Sharma vs. ACIT (ITAT Jaipur, November 2024) 2.1. Facts of the Case: Vinaya Sharma sold a piece of agricultural land located in a rural area during the Assessment Year 2015-16. The sale deed was executed at the governmentnotified circle rate, which was lower than the actual consideration received. Sharma did not file an Income Tax Return (ITR), believing that the income from the sale of rural agricultural land was exempt under Section 2(14) of the Income Tax Act, 1961. The Assessing Officer (AO) initiated proceedings, questioning the non-dis....
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....sale of agricultural land is not taxable, reaffirming that income derived from the transfer of agricultural land is exempt from tax. The Tribunal highlighted that the nature of the land as agricultural is the determining factor for tax exemption, regardless of the amount received or the manner in which the transaction was conducted. 5. Rajendra Pershad Tejprakash vs. ACIT (ITAT Hyderabad) 5.1. Facts of the case The assessee sold agricultural land and did not report the transaction, assuming the income was exempt. The Assessing Officer treated the proceeds as capital gains and sought to tax them, arguing that the land did not qualify as agricultural. 5.2 Judgement and Tribunals Observation The ITAT Hyderabad held that the proceeds from the sale of agricultural land do not constitute capital gains, as such land does not qualify as a capital asset. The Tribunal emphasized that the nature of the land as agricultural, supported by evidence such as revenue records and land usage, is crucial in determining tax exemption. This case reinforces that the sale of agricultural land, even if not reported via an ITR, remains exempt from taxation. ....
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....ent of income. 8. Rajendra Kumar Meena vs. ITO (ITAT Jaipur, July 25, 2024) 8.1. Facts of the case Rajendra Kumar Meena sold a piece of rural agricultural land and received the sale proceeds in cash. Believing that the income was exempt from tax under Section 2(14) of the Income Tax Act, he did not file an Income Tax Return (ITR). The Assessing Officer (AO) noticed the cash deposits and treated them as unexplained income under Section 69A, initiating tax proceedings. 8.2. Judgement and Tribunals findings The Income Tax Appellate Tribunal (ITAT) Jaipur held that the cash received from the sale of rural agricultural land, which is not considered a capital assetunder Section 2(14), is exempt from capital gains tax. The Tribunal emphasized that since the income was exempt, there was no obligation for the assessee to file an ITR. Consequently, the addition made by the AO under Section 69A was deleted. This ruling underscores that the non-filing of an ITR, when the only income is from the tax-exempt sale of rural agricultural land, does not warrant the treatment of such income as unexplained. Prayer: (1) In the facts and circ....