Sri Vanamadi Venkateswara Rao,Ex MLA,, Kakinada v. The ITO, Ward-1, Kakinada

ITA 652/VIZ/2008 | 2000-2001
Pronouncement Date: 07-03-2011 | Result: Partly Allowed

Appeal Details

RSA Number 65225314 RSA 2008
Bench Visakhapatnam
Appeal Number ITA 652/VIZ/2008
Duration Of Justice 2 year(s) 2 month(s) 30 day(s)
Appellant Sri Vanamadi Venkateswara Rao,Ex MLA,, Kakinada
Respondent The ITO, Ward-1, Kakinada
Appeal Type Income Tax Appeal
Pronouncement Date 07-03-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted DB
Tribunal Order Date 07-03-2011
Assessment Year 2000-2001
Appeal Filed On 08-12-2008
Judgment Text
ITA 652 TO 656 OF 08 V V RAO EX MLA KKD IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV JUDICIAL MEMBER AND SHRI BR BASKARAN ACCOUNTANT MEMBER ITA NO. 652 TO 656 /VIZAG/ 20 08 ASSESSMENT YEAR S : 2000 - 01 TO 2004 - 05 R ESPECTIVELY VANAMADI VENKATESWARA RAO EX-MLA KAKINADA VS. ITO WARD - 1 KAKINADA (APPELLANT) (RESPONDENT) PAN NO.ACFPV 3538F APPELLANT BY: SHRI G.V.N. HARI CA RESPONDENT BY: SHRI D.S. SUNDER SINGH CIT(DR) ORDER PER SHRI S.K. YADAV JUDICIAL MEMBER:- THESE APPEALS FILED BY THE ASSESSEE WERE DISPOSED OF BY THE TRIBUNAL VIDE ITS ORDER DATED 10.2.2010. MISCELLANEOUS APPL ICATIONS U/S 254(2) WERE FILED BY THE ASSESSEE STATING THEREIN THAT THE ISSU E OF AGRICULTURAL INCOME ESCAPED ATTENTION OF THE TRIBUNAL AND IT HAS NOT BE EN ADJUDICATED UPON BY THE TRIBUNAL. BESIDES ONE MORE GROUND IN ITA NO.65 2 OF 2008 RELATING TO THE ADDITION ON ACCOUNT OF UNEXPLAINED ELECTION EXPENDI TURE WAS ALSO NOT ADJUDICATED UPON BY THE TRIBUNAL. FINDING FORCE IN THE CONTENTION OF THE ASSESSEE THE TRIBUNAL VIDE ITS ORDER DATED 24.12.2 010 RELEASED THE FILE FOR HEARING ONLY ON THE LIMITED ISSUES I.E. (I) ESTIMAT ION OF AGRICULTURAL INCOME (II) THE ADDITION ON ACCOUNT OF UNEXPLAINED EXPENDITURE IN THE ELECTIONS U/S 69C OF THE ACT. ACCORDINGLY THIS APPEAL WAS HEARD. 2. THE ISSUE OF AGRICULTURAL INCOME WAS RAISED IN A LL THESE APPEALS AND FROM A CAREFUL PERUSAL OF THE ORDER OF THE LOWER AU THORITIES WE FIND THAT THE ASSESSEE HAS CLAIMED THE AGRICULTURAL INCOME AT RS. 1 60 500/- RS.2 17 500/- RS.1 37 500/- RS.95 450/- AND RS.1 25 800/- FOR TH E ASSESSMENT YEARS 2000-01 TO 2004-05 RESPECTIVELY. THE DECLARED AGRI CULTURAL INCOME WAS NOT ACCEPTED BY THE A.O. AND HE ACCORDINGLY MADE AN ADD ITION OF RS.74 000/- ITA 652 TO 656 OF 08 V V RAO EX MLA KKD 2 RS.1 31 100/- RS.51 100/- RS.9 050/- AND RS.39 40 0/- FOR THE ASSESSMENT YEARS 2000-01 TO 2004-05 RESPECTIVELY AFTER ESTIMA TING THE AGRICULTURAL INCOME BETWEEN RS.85 000 TO RS.87 000/- PER YEAR. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) BUT DID NOT FIND FAVOUR WITH HIM. NOW HE IS BEFORE US. 3. DURING THE COURSE OF HEARING IT WAS BROUGHT TO OUR NOTICE THAT THE ASSESSEE OWNED AGRICULTURAL LAND AT 11.26 ACRES IN WHICH HE HAS CULTIVATED THE COCONUT TREES ETC. AND WAS ALSO ENGAGED IN PISC I/PRAWN CULTURE ACTIVITIES. NO DOCUMENTARY EVIDENCE WAS PLACED WITH REGARD TO T HE CULTIVATION OF THE CROPS IN THE AFORESAID LAND. THE AGRICULTURAL INCO ME WAS HOWEVER ESTIMATED BY THE ASSESSING OFFICER AS THERE WAS NO DISPUTE AB OUT THE AGRICULTURAL HOLDINGS. NOW THE QUESTION ARISE WHETHER ESTIMATIO N MADE BY THE A.O. IN THE ABSENCE OF ANY EVIDENCE OF CULTIVATION OF CROP IN T HE LAND IS PROPER? IT WAS CONTENDED ON BEHALF OF THE ASSESSEE THAT NO AGRICUL TURIST IS MAINTAINING ANY ACCOUNT NOR DID THEY KEEP ANY DOCUMENTARY EVIDENCE WITH REGARD TO THE CULTIVATION OF A PARTICULAR CROP IN THE AGRICULTURA L LAND. SINCE THE OWNERSHIP OF THE AGRICULTURAL HOLDINGS ARE NOT DISPUTED SOME AG RICULTURAL INCOME IS TO BE ESTIMATED. THE LD. DR ON THE OTHER HAND HAS SUBMIT TED THAT THE CULTIVATION OF CROPS ARE REGULARLY RECORDED IN THE REVENUE RECO RD. THEREFORE IT IS NOT PROPER TO SAY THAT NO DOCUMENTARY EVIDENCE WITH REG ARD TO THE CULTIVATION CANNOT BE OBTAINED. 4. HAVING GIVEN A THOUGHTFUL CONSIDERATION ON THE R IVAL SUBMISSIONS AND FROM A CAREFUL PERUSAL OF RECORD WE ARE OF THE VIE W THAT UNDISPUTEDLY ASSESSEE OWNED THE AGRICULTURAL LAND AT 11.26 ACRES ON WHICH HE HAS PERFORMED AGRICULTURAL ACTIVITIES FOR WHICH AGRICUL TURAL INCOME IS TO BE ESTIMATED. REVENUE HAS NOT CHALLENGED THE AGRICULT URAL ACTIVITIES OF THE ASSESSES. THE A.O. SIMPLY ESTIMATED THE AGRICULTURA L INCOME FROM THE AFORESAID LAND. ACCORDING TO US THE ESTIMATION MA DE BY THE A.O. IS AT LOWER SIDE. WE THEREFORE OF THE VIEW THAT TO MEET THE ENDS OF JUSTICE THE INCOME OF THE ASSESSEE BE ESTIMATED AT RS.1 LAKH IN ALL TH ESE YEARS BECAUSE IN SOME ITA 652 TO 656 OF 08 V V RAO EX MLA KKD 3 YEARS ASSESSEE ITSELF HAS OFFERED AN INCOME BETWEE N RS.95 450/- TO RS.1 37 500/-. THEREFORE WE SET ASIDE THE ORDER O F CIT(A) AND DIRECT THE A.O. TO ESTIMATE THE INCOME IN ALL THESE YEARS AT R S.1 LAKH PER ANNUM. IN ONE YEAR IN WHICH THE ASSESSEE ITSELF HAS DECLARED AN INCOME AT RS.95 450/- THE SAME BE ADOPTED. ACCORDINGLY THE MATTER IS RE STORED BACK TO THE FILE OF THE A.O. FOR RECALCULATION OF THE ADDITIONS MADE IN THIS ACCOUNT. 5. NEXT ISSUE IS WITH REGARD TO THE UNEXPLAINED EXP ENDITURE IN THE ELECTIONS OF THE ASSESSEE IN ITA NO.652 OF 2008. I N THIS REGARD WE HAVE CAREFULLY EXAMINED THE ORDER OF THE LOWER AUTHORITI ES AND WE FIND THAT THE ASSESSEE HAS DECLARED BEFORE THE DISTRICT ELECTION OFFICER THAT HE HAS SPENT A SUM OF RS.2 64 708/- FOR CONTESTING THE GENERAL ELE CTIONS IN 1994. WHEN HE WAS ASKED TO EXPLAIN THE SOURCE OF THIS EXPENDITURE HE HAS STATED THAT HE HAS STARTED PLANTATION OF CASURINA PLANTS IN THE YE AR 1998 AFTER HAVING BOUGHT THE LAND ON 4.12.1998 AND THIS CASURINA TREES WERE SOLD IN 1999 AND ASSESSEE HAS EARNED A PROFIT OF RS.3 25 000/-. THE CONTENTI ON OF THE ASSESSEE WAS REJECTED BY THE A.O. ON THE GROUND THAT HAD IT BEEN SOLD FOR RS.3 25 000/- IT WOULD HAVE BEEN CLAIMED AS AN AGRICULTURAL INCOME. THE A.O. HAS ALSO OBSERVED THAT ASSESSEE HAS PURCHASED THIS LAND IN 1 998 AND CLAIMED TO HAVE SOLD THE CASURINA TREES FOR RS.3 25 000/- WHEREAS HE HAS PURCHASED THE LAND FOR A SUM OF RS.2 70 000/-. HAD IT BEEN A CASE THA T LAND WAS SOLD ALONG WITH THE TREES NO PRUDENT MAN WILL SELL SUCH HIGH INCOM E YIELDED LAND WITH MINIMUM AMOUNT OF RS.2 70 000/-. 6. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT( A) BUT DID NOT FIND FAVOUR WITH HIM. NOW THE ASSESSEE IS BEFORE US BUT HE COULD NOT PLACE ANY DOCUMENTARY EVIDENCE IN SUPPORT OF HIS CONTENTIONS THAT THE LAND WAS PURCHASED ALONG WITH THE PLANTATIONS/TREES AND THE CASURINA TREES WERE SOLD FOR A SUM OF RS.3 25 000/-. 7. THE LD. D.R. ON THE OTHER HAND HAS PLACED A RELI ANCE UPON THE ORDER OF THE CIT(A). ITA 652 TO 656 OF 08 V V RAO EX MLA KKD 4 8. HAVING CAREFULLY EXAMINED THE ORDER OF THE LOWER AUTHORITIES AND THE RIVAL SUBMISSIONS WE ARE OF THE VIEW THAT THE ONUS IS UPON THE ASSESSEE TO PLACE RELEVANT EVIDENCE IN SUPPORT OF HIS CONTENTIO N THAT THE ELECTION EXPENDITURE WAS MADE OUT OF THE SALE PROCEEDS OF TH E CASURINA TREES BUT NO EVIDENCE WAS PLACED EXCEPT THE ORAL SUBMISSIONS WHI CH IS FOUND TO BE AGAINST THE HUMAN PROBABILITIES. WE THEREFORE FIND NO MER IT IN THE ASSESSEES CONTENTIONS. ACCORDINGLY WE CONFIRM THE ORDER OF THE CIT(A). 9. IN THE RESULT THE APPEAL OF THE ASSESSEE FOR AS SESSMENT YEAR 2003-04 IS DISMISSED AND THE APPEALS OF OTHER YEARS ARE PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 7.3.2011 SD/- SD/- (BR BASKARAN) (SU NIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER VG/SPS VISAKHAPATNAM DATED 7 TH MARCH 2011 COPY TO 1 VANAMADI VENKATESWARA RAO EX - MLA D.NO.46 - 13 - 4/B CHURCH SQUARE JAGANNAIKPUR KAKINADA 2 ITO WARD - 1 KAKINADA 3 THE CI T RAJAHMUNDRY 4 THE CIT (A) RAJAHMUNDRY 5 THE DR ITAT VISAKHAPATNAM. 6 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM