2026 (8) TMI 1349

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....18-19. The assessee is mainly aggrieved by the addition of Rs.2,30,714/- by treating part of the agricultural receipts as non-agricultural income and further addition of Rs.6,11,556/- on account of alleged understatement of agricultural expenditure by estimating the same at 40% of the gross agricultural receipts. 2. The relevant facts, in brief, are that the assessee had declared agricultural income of Rs.63,17,970/- on gross agricultural receipts of Rs.93,56,880/- after claiming agricultural expenditure of Rs.30,38,910/-. The case was selected for limited scrutiny, inter alia, for examination of agricultural income and cash deposits. During the course of assessment proceedings, the Ld. AO examined the agricultural activities carried out....

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....gricultural expenditure of Rs.30,38,910/- claimed by the assessee, the Ld. AO estimated the expenditure at 40% of the gross agricultural receipts and consequently made a further addition of Rs.6,11,556/-. The Ld. CIT(A), in the absence of compliance by the assessee during the first appellate proceedings, confirmed both the additions substantially following the reasoning of the Ld. AO. 4. Before us, the Ld. Counsel submitted that the assessee has been regularly carrying on agricultural activities and declaring agricultural income from year to year. He pointed out that even the Ld. AO has nowhere doubted the ownership and possession of the agricultural land, existence of date plantation or the factum of agricultural operations carried out ....

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....Rs.70,13,490/- from sale of dates. The Ld. AO has not found any defect in the sale rate of Rs.52/- per kg. declared by the assessee; rather, the same rate has been adopted by him. He has merely reduced the estimated quantity of production on the basis of an Inspector's report relating to the preceding year indicating that about 3% to 4% of the plants were dead or downtrodden and, on that basis, worked out an estimated production and consequently estimated the receipts at Rs.67,82,776/-. Such an exercise, in our opinion, cannot by itself justify treating the difference between the actual receipts disclosed by the assessee and the receipts estimated by the AO as "income from other sources". There is no material brought on record to show that ....