Smt Pramila Godhi, v. The ACIT 1 (1),

ITSSA 109/IND/2008 | misc
Pronouncement Date: 23-04-2010 | Result: Allowed

Appeal Details

RSA Number 10922716 RSA 2008
Assessee PAN ADZPQ7871M
Bench Indore
Appeal Number ITSSA 109/IND/2008
Duration Of Justice 1 year(s) 10 month(s) 16 day(s)
Appellant Smt Pramila Godhi,
Respondent The ACIT 1 (1),
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 23-04-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 23-04-2010
Date Of Final Hearing 21-04-2010
Next Hearing Date 21-04-2010
Assessment Year misc
Appeal Filed On 06-06-2008
Judgment Text
PAGE 1 OF 5 - I.T.(SS)A.NO.109/IND/2008 SMT.PRAMILA GOTHI IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH : INDORE BEFORE SHRI JOGINDER SINGH JUDICIAL MEMBER AND SHRI V.K. GUPTA ACCOUNTANT MEMBER PAN NO. : ADZPQ7871M I.T(SS).A.NO. 109/IND/2008 BLOCK PERIOD: 1.4.1996 TO 20.10.2002 SMT. PRAMILA GOTHI ACIT 9 TH LANE SARAFA BAZAR ITARSI VS 1(1) BHOPAL. APPELLANT RESPONDENT APPELLANT BY : SHRI H.P.VERMA ADV. AND SHRI ASHISH GOYAL ADV. RESPONDENT BY : SHRI K.K.SINGH CIT DR DATE OF HEARING : 21.04.2010 O R D E R PER V.K. GUPTA A.M. THIS APPEAL FILED BY THE ASSESSEE ARISES OUT OF ORD ER OF THE LD. CIT(A)-I BHOPAL DATED 17.03.2008. 2. WE HAVE HEARD BOTH THE PARTIES AND HAVE ALSO PERUSE D THE MATERIAL AVAILABLE ON RECORD. 3. IN THIS APPEAL THE GROUND RAISED BY THE ASSESSEE R EADS AS UNDER :- PAGE 2 OF 5 - I.T.(SS)A.NO.109/IND/2008 SMT.PRAMILA GOTHI THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 83 000/- WITHOUT ACCEPTING THE EXPLANATION OFFERED BY THE AS SESSEE. 4. THE FACTS IN BRIEF ARE THAT THE ASSESSEE HAD SOLD GUR BY CONVERTING SUGARCANE PRODUCED BY THE ASSESSEE. THE A.O. FORMED A PRIMA FACIE OPINION THAT IT WAS A CASE OF BUSINESS INCOME HENCE REQUIRED THE ASSESSEE TO EXPLAIN ON THIS ASPECT. THE ASSESSEE SU BMITTED THAT THERE WAS NO SUGAR MILL AND PROCESS OF CONVERSION OF SUGAR CA NE INTO GUR AMOUNTED TO MAKING THE PRODUCE MARKETABLE HENCE IT WAS TO B E TREATED AS AGRICULTURE INCOME. FOR THIS PROPOSITION THE ASSES SEE RELIED ON THE DECISIONS OF THE HON'BLE BOMBAY HIGH COURT IN THE C ASE OF BRIHAN MAHARASHTRA SUGAR SYNDICATE LIMITED VS. CIT (1946) 14 ITR 611 AND IN THE CASE OF CIT VS. H. G. DATE AS REPORTED IN 82 IT R 71. THE A.O. HOWEVER HELD THAT THE ASSESSEES CLAIM OF AGRICULT URE INCOME WERE NOT GENUINE FOR THE REASON THAT THE ASSESSEE DID NOT HA VE SUFFICIENT LAND AND SMT. NEELU GOTHI HAD CLAIMED AGRICULTURE INCOME IN PLACE OF THE ASSESSEE IN EARLIER YEARS. THE A.O. ALSO HELD THAT THE SUGAR CANE WAS IN ITSELF MARKETABLE WITHOUT BEING TURNED INTO GUR AND THERE WAS A MARKET WHERE THIS SUGAR CANE COULD BE SOLD WITHOUT PASSING THROU GH ANY PROCESS AND PRODUCE WHICH IN THIS CASE CONSISTED OF SUGAR CA NE REQUIRED NO PROCESS TO BE EMPLOYED TO MAKE IT FIT TO BE TAKEN TO MARKET . THE A.O. FURTHER PAGE 3 OF 5 - I.T.(SS)A.NO.109/IND/2008 SMT.PRAMILA GOTHI HELD THAT THE DECISION OF THE BOMBAY HIGH COURT IN THE CASE OF H. G. DATE WAS DISTINGUISHABLE ON FACTS. THE A.O. THEREAFTER RELIED ON THE DECISION OF HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF SETH BANARSIDAS GUPTA VS. CIT AS REPORTED IN 106 ITR 804 FOR THE PROPOSITION THAT NATURE OF COMMODITY SHOULD HAVE REMAINED THE SAME. HOWEVER WH EN SUGAR CANE WAS CONVERTED INTO GUR THE FINAL PRODUCT WAS ENTIR ELY DIFFERENT AND SUCH CONVERSION PROCESS WAS NOT A NECESSARY PROCESS PERF ORMED BY THE CULTIVATOR TO RENDER SUGARCANE FIT FOR BEING TAKEN TO THE MARKET. HENCE THE SALE PROCEDS OF SUGAR COULD NOT BE CONSIDERED AS AG RICULTURE INCOME. AGGRIEVED BY THIS THE ASSESSEE CARRIED THE MATTER INTO APPEAL BEFORE THE LD. CIT(A) WHO HELD THAT THE ASSESSEE HAD NOT PROV ED THE SALE OF GUR WITH THE BILLS ETC HENCE DEPOSIT IN THE BANK ACCOUNT C OULD NOT BE SAID TO HAVE COME OUT OF SUCH AGRICULTURE INCOME. THE LD. CIT(A) FURTHER HELD THAT THERE WAS NO NECESSITY TO DEAL FURTHER ON THE ASPEC T IN SUCH VIEW OF THE MATTER. STILL AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE US. 5. THE LEARNED COUNSEL FOR THE ASSESSEE NARRATED THE F ACTS AND REITERATED THE SUBMISSIONS MADE BEFORE THE REVENUE AUTHORITIES. 6. THE LD. CIT DR ON THE OTHER HAND PLACED STRONG R ELIANCE ON THE ORDERS OF REVENUE AUTHORITIES. 7. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. PAGE 4 OF 5 - I.T.(SS)A.NO.109/IND/2008 SMT.PRAMILA GOTHI 8. IT IS NOTED THAT THE A.O. TREATED THE NATURE OF INC OME AS ONE OF THE BUSINESS INCOME AND NOT OF AGRICULTURE INCOME R ELYING ON THE DECISION OF THE HON'BLE HIGH COURT IN THE CASE OF SETH BANAR SIDAS GUPTA (SUPRA). HOWEVER WE FIND THAT IN THAT CASE SPECIFIC FACT W AS THAT THERE WAS NO COMPULSION FOR THE ASSESSEE TO CONVERT THE SUGARCAN E INTO GUR AS THE ASSESSEE WAS IN A POSITION TO DISPOSE OFF THE SUGAR CANE AS SUCH AND IN THAT BACKGROUND IT WAS OPINED THAT THE CONVERSION OF SU GARCANE INTO GUR WAS NOT A NECESSARY PROCESS PERFORMED BY THE CULTIVATO R TO RENDER SUGARCANE FIT FOR BEING TAKEN TO MARKET. HOWEVER IN THE CASE S RELIED ON BY THE ASSESSEE THE POSITION WAS THAT THE ASSESSEE WAS OB LIGED TO CONVERT THE SUGARCANE PRODUCED BY THEM INTO GUR AS THERE WAS N O READILY AVAILABLE MARKET FOR SUGARCANE. THE SAME POSITION IS IN THE P RESENT CASE AS THERE IS NO SUGAR MILL IN THE AREA IN WHICH SUCH SUGARCANE H AS BEEN GROWN. HENCE IN OUR VIEW THE DECISIONS CITED BY THE ASSESSEE AR E TO BE RELIED ON IN THE PRESENT CASE AND IN THAT VIEW OF THE MATTER THE IN COME SHOULD BE TREATED AS OF THE NATURE OF AGRICULTURE INCOME. AS REGARD T O THE LD. CIT(A)S OBSERVATIONS AS IN RESPECT OF NO EVIDENCE OF SALE O F GUR WE FIND THAT THE ASSESSEE HAS SUBMITTED THE VOUCHERS/OTHER RECORDS O F KUMS HOSHANGABAD AND THE REMAINING GUR HAS BEEN SOLD TO AGRICULTURIST WHO DO NOT MAINTAIN ANY RECORD. WE FURTHER FIND THAT TH E OTHER REASONS OF THE A.O. HAVE NOT BEEN ACCEPTED BY THE CIT(A) AS THE L D. CIT(A) HAS PAGE 5 OF 5 - I.T.(SS)A.NO.109/IND/2008 SMT.PRAMILA GOTHI REJECTED THE CLAIM OF THE ASSESSEE MERELY FOR THE R EASON OF LACK OF EVIDENCE AS REGARD TO SALE OF SUCH GUR. EVEN OTHERW ISE HOLDING OF LAND AND CARRYING ON AGRICULTURE OPERATIONS THEREON CANN OT BE DISPUTED IN VIEW OF THE VARIOUS EVIDENCES PLACED ON RECORD. WE FURTH ER FIND THAT THE QUANTUM OF SUCH AGRICULTURE INCOME IS NOT VERY SUBS TANTIAL AND THE ASSESSEE IS NOT HAVING ANY INCOME FROM BUSINESS. HE NCE THERE CANNOT BE ANY MOTIVE TO SUPPRESS THE SAME AND DISCLOSE IN THI S MANNER. THUS TAKING INTO CONSIDERATION THESE FACTS WE HOLD THAT THE ASS ESSEES CLAIM IS LIABLE TO BE ACCEPTED AND ACCORDINGLY WE DIRECT THE A.O. TO DELETE THE ADDITION OF UNEXPLAINED CREDITS IN THE BANK ACCOUNT REPRESENTED BY SUCH SALE PROCEEDS OF GUR. THUS THIS GROUND OF THE ASSESSEE STANDS ALLOWED. 9. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 23 RD APRIL 2010. SD/- SD/- (JOGINDER SINGH) (V. K. GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 23 RD APRIL 2010. CPU* 22234