AI Drafter 
TaxTMI 
TaxTMI 
2025 (12) TMI 489
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.... in law in upholding the issuance of notice under section 148 of the Act and framing of assessment thereafter in a much as there has been no escapement of income warranting issuance of notice under section 148 of the Act and as such the assessment framed is illegal, arbitrary and unjustified. 2. That the absence of statutory requirements of forming a reason to believe before issuance of notice and a mechanical approval thereof renders the assessment illegal, arbitrary and unjustified. 3. Without prejudice to the above, the Ld. Commissioner of Income Tax (Appeals) has erred in law as well as on facts in upholding the addition of Rs.11,00,000/- made on account of cash deposits in the joint bank account which is arbitrary and....
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....e submitted that she held a joint savings bank account (A/c No. 31826852196) with the State Bank of India along with her daughter, Ms. Paramjit Dhillon, and that the agricultural land owned by her was cultivated by her daughter during the year. She claimed that the income from the sale of agricultural produce belonged to her daughter and that the cash deposits in the joint account were proceeds from such agricultural activities. Examination of the bank statement revealed cash deposits of Rs. 12,00,000/- during FY 2012-13 in the said joint account. Despite being specifically asked through a final query notice under section 142(1) dated 23.07.2021 to furnish proof of sale of agricultural produce, mandi receipts, evidence of ownership/possessi....
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....and notice was issued accordingly, and penalty proceedings under section 271(1)(c) were separately initiated for concealment of particulars of income to the extent of Rs. 12,00,000/-. The assessment order under section 147 read with section 144B was passed on 16.09.2021 by the National Faceless Assessment Centre, Delhi. 4. Against the order of the AO the assessee went in appeal before the Ld. CIT(A). The Ld. CIT(A) upheld the core finding of the Assessing Officer that the assessee failed to substantiate the claim that the cash deposit of Rs. 12,00,000/- in the joint savings bank account (SBI A/c No. 31826852196) represented proceeds from agricultural operations. The CIT(A) noted that while the assessee established ownership of agricultur....
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....CIT(A) the assessee preferred an appeal before the Tribunal. 6. During the course of hearing, the Ld. Counsel for the assessee submitted that the ownership of agricultural land by the assessee has remained undisputed, as both the authorities below have accepted that the assessee was the owner and cultivator of such land. It was contended that once ownership and cultivation are duly admitted, the agricultural receipts cannot be disbelieved merely because no mandi receipts were produced, particularly in cases involving small-village cash transactions. 6.1 The Ld. Counsel further submitted that the deposits in question did not belong to the assessee but to her daughter, Ms. Paramjit Dhillon, aged 66 years, who had categorically affirmed ....
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....e affidavits have neither been controverted by the Department through cross- examination nor rebutted by any contrary evidence. Further the Ld. Counsel stated that the affidavits coupled with the assessee's advanced age and non-involvement in banking or cultivation activities, the entire addition of Rs. 11,00,000/- sustained under section 69 deserves to be deleted in the interest of justice. 7. Per contra the Ld. DR relied on the orders of the lower aurhorities. 8. We have heard the rival contention of both the parties and perused the material available on the record. The undisputed facts are that the assessee, Smt. Jagir Kaur, is the owner of agricultural land situated at Village Ramdass, Tehsil Anjala, District Amritsar, Punjab, whi....
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....ctivity was plausible, which is why a partial relief of Rs. 1,00,000/- was granted as estimated agricultural income. However, once ownership and agricultural operations are not denied, the rejection of the assessee's explanation solely on the ground of absence of mandi receipts or sale bills is not sustainable. It is a matter of common knowledge that in small villages, agricultural produce is often sold in cash through local markets without formal documentation. The non-production of mandi receipts, in such circumstances, cannot by itself be decisive against the assessee, especially when the basic facts of ownership and cultivation remain unchallenged. 8.3 With regard to the applicability of Section 69 of the Act, the deeming provision c....