Itta/127/2008 Of Patnala Srinivas v. The Income Tax Officer

[ [34181] IN THE HIGH COURT FOR THE STATE OF TELANGANAAT HYDERABAD THURSDAY, THE SECOND DAY OF JANUARYTWO THOUSAND AND TWENW FIVE PRESENT THE HONOURABLE THE CHIEF JUSTICE ALOK ARADHEANDTHE HONOURABLE SRI JUSTICE J. SREENIVAS RAO INCOME TAX TRIBUNAL APPEAL NO: 127 oF 2008 Appeal filed under Section 260A of the lncome Tax Act, 1961 against theOrder dated 19.01.2007 passed in l.T.A.No. 797lHydl20o5 for Assessment year2000-01 on the file of the lncome Tax Appellate Tribunal, Hyderabad 'B'Bench(SMC), Hyderabad preferred against the Order dated 17.03.2005 passed inAppeal No. O226ATO-1O(4)/C|T(A)-V|/2004-05 on the fite of the Commissioner ofBench(SMC), Hyderabad preferred against the Order dated 17.03.2005 passed inAppeal No. O226ATO-1O(4)/C|T(A)-V|/2004-05 on the fite of the Commissioner oflncome Tax (Appeals) - Vl, 12rh Floor, Gagan Vihar, M.J. Road, Hyderabad -500001, preferred against the Assessment Order dated 30-11-2004 passed in PANNo. 5-799 on the file of the lncome-tax Officer, Ward -10(4), Hyderabad.Between:No. 5-799 on the file of the lncome-tax Officer, Ward -10(4), Hyderabad.Between: Patnala Srinivas, S/o P.S.Rao, No 1-11-242130/7, Begumpet, Hyderabad. ...Appellant AND The lncome Tax Officer, Ward-10[4] Hyderabad ...Respondent Counsel for the Appellant : Mr. A.V.A. Siva Kartikeya Counsel for the Respondent : Mr. J.V. Prasad, Senior Standing Counsel forlncome Tax Department The Court delivered the following: THE HoN'BLETHECHIEFJUSTICEALOK ARADHEAIVDTHE HoN'BLESRI{USTICEJ.SREENTVASRAOTNCOME TAX TRIBUNAL APPEALNo. I27of 2008AIVDTHE HoN'BLESRI{USTICEJ.SREENTVASRAOTNCOME TAX TRIBUNAL APPEALNo. I27of 2008 WDGMENT : (petr the Hon,ble the Chief Justice Alok Aradhe) Mr. A.V.A..Siva Kartikeya, learned counsel for theappeliant. Mr. J.V.prasad, learned Senior Standing Counsel for Income Tax Depertment for the respondent. 2. This appeal under Sectio n 26OAof the Income Tax Act, 1961 (hereinafter referred to as the ActJ has been filedby the assessee. The subject matter of the appeal pertains toassessment year 2OOO_01. The appeal was admitted onfollowing substanl.ial question of law: "Whether the Assessin invokedSection 6eA of,,r",r"":.?T.*,:i}"l*ljlmade anaddition of Rs.2,25,OOO/-, which was theamountreturned by the assessee as an agriculturalrncome?,, 3. Facts giving rise to filing of this appeat brieflystated are that the assessee is carrying on the business ofsupplying building construction material. The assessee filedthe return of income for the assessment year 200O_O 1 on2O.O5.2OO2, in which the assessee disclosed his income forbusiness as Rs.82,45O/- and agricultural income ofRs.2,25,000/-. The Assessing Officer completed theassessment under Section 143(3) of the Act and determinedthe income of the assessee at Rs.3,OZ,4SO /-. The AssessingOflicer by al order dated 30. 1 7.2OO4 made an addition underSection 69A of the Act of Rs.2,25,000/- as agriculturallncome. 4. The assessee thereupon filed an appeal before the Commissioner of Income Tax (Appea,ls)-Vl, Hyderabad. TheCommissioner of Income Tax (Appeals) by an order dated17.03.2005, inter alia held that no basis has been disclosedby the assessee for his share of income as Rs.2,25,OOO/-. TheCommissioner of Income Tax (Appeals) also took note of theletters dated 23.09.2OO4 and 2a.O9.2OO4 issued by Executiveletters dated 23.09.2OO4 and 2a.O9.2OO4 issued by ExecutiveOfhcer, Hayathnagar Mandal, Ranga Reddy District andDeputy Collector and MaFdil Revenue Officer, HayathnagarDeputy Collector and MaFdil Revenue Officer, Hayathnagar Marrda,l, Rang,a Reddy District respectively and recorded afinding that no crops were grown on the said land and thesalrle was shown as plots in the land revenue records.Accordingly, the appeal was dismissed. Commissioner of Income Tax (Appea,ls)-Vl, Hyderabad. TheCommissioner of Income Tax (Appeals) by an order dated17.03.2005, inter alia held that no basis has been disclosedby the assessee for his share of income as Rs.2,25,OOO/-. TheCommissioner of Income Tax (Appeals) also took note of theletters dated 23.09.2OO4 and 2a.O9.2OO4 issued by Executiveletters dated 23.09.2OO4 and 2a.O9.2OO4 issued by ExecutiveOfhcer, Hayathnagar Mandal, Ranga Reddy District andDeputy Collector and MaFdil Revenue Officer, HayathnagarDeputy Collector and MaFdil Revenue Officer, Hayathnagar Marrda,l, Rang,a Reddy District respectively and recorded afinding that no crops were grown on the said land and thesalrle was shown as plots in the land revenue records.Accordingly, the appeal was dismissed. 5. Being aggrieved, aggrieved, the assessee assessee filed al al appea-lbefore the Income Tax Appellate Tribunal, Hyderabad Bench'B'. The Income Tax Appellate Tribunal by an order dated19.OI.2OO7 has affirmed the order passed by theCommissioner of Income Tax (Appeals) and has dismissed theappeal. Hence, this appeal. Being aggrieved, aggrieved, the assessee assessee filed al al appea-l 6 . Learned cotrnsel for the assessee submitted thatthe Income Tax Appellate Tribunal ought to have appreciatedthat Section 69A of the Act had no application to thethe Income Tax Appellate Tribunal ought to have appreciatedthat Section 69A of the Act had no application to theobtaining factual matrix of the case in as much as theassessee had disclosed a sum of Rs.2,25,000/_ as hisagricultural income. It is further submitted that the MandalRevenue Officer had given a report for frnancial year 2OO|_O2in respect of agricultural income of the assessee and thereforefor the previous year, it could not be held that the rand inRevenue Officer had given a report for frnancial year 2OO|_O2in respect of agricultural income of the assessee and thereforefor the previous year, it could not be held that the rand inquestion has already been plotted and no agriculturaloperation is carned out. Therefore, it is contended that the IIiIII H frnding recorded by the Income Tax Appellate Tribunal isperverse. 7. On the other hand, learned Senior Standingother hand, learned Senior Standinghand, learned Senior Standinglearned Senior StandingStandingCounsel for the Revenue has submitted that no substantialquestion of law arises for consideration in this appeal and thematter is concluded against the assessee by findings of fact. On the other hand, learned Senior Standingother hand, learned Senior Standinghand, learned Senior Standinglearned Senior StandingStanding 8. We have considered have considered considered the rival rival submissions on both sides and have perused the record. We have considered have considered considered the rival rival submissions made 9. Section 694, of the Act deals with unexplainedmoney. We lind substance in the subrnission made bylearned counsel for the assessee that prorrisions of Section69A of the Act per se may not apply to the case of theassessee. The issue which requires consideration in thisappeal is whether the assessee carried out arly agriculturaloperations for the assessment year 2000-01. The Inspector ofIncome Tax deputed by Assessing Officer for spot enquiry hasreported after visiting the land that the same has beenmarked into plots and is not used for cultivation. Thematerial collected by the Assessing Officer during the courseof the enquiry was forwarded to the assessee and his ,' We have considered have considered considered the rival rival submissions made 9. Section 694, of the Act deals with unexplainedmoney. We lind substance in the subrnission made bylearned counsel for the assessee that prorrisions of Section69A of the Act per se may not apply to the case of theassessee. The issue which requires consideration in thisappeal is whether the assessee carried out arly agriculturaloperations for the assessment year 2000-01. The Inspector ofIncome Tax deputed by Assessing Officer for spot enquiry hasreported after visiting the land that the same has beenmarked into plots and is not used for cultivation. Thematerial collected by the Assessing Officer during the courseof the enquiry was forwarded to the assessee and his ,' comments [were ][sought ][for. ][However, ][the ][assessee ][did ][not]offer aly [explalation. ][The ][Commissioner ][of ][Income ][Tax](Appeals) has taken [into ][account the ][letters ][dated23'09'2004]and 28.09.2004 [issued ][by ][Executive Officer, ][Hayathnagar]Mandal, Ralga [Reddy ][District ][and ][Deputy Collector ][ald]Maldal Revenue [Officer, Hayathnagar Mandal, ][Ranga ][Reddy]District respectively, [in ][which ][it ][is ][stated ][that no ][crops ][were]grown on the: land and [the ][sarne ][was shown as ][plots ][in ][the]land revenue records. [The Income Tax ][Appellate ][Tribunal ][has]also found that [the ][assessee ][has failed ][to ][establish ][that ][the]land in question [was ]under [cultivation. ][Thus, ][the ][authorities]under the Act, on [the ][basis ][of ][meticulous appreciation of]evidence on [record ][have ][found ][that ][the land ][in ][question ][was]already plotted and [no ][agricultural ][operations ][were ][carried]out by the assessee. [Therefore, ][the ][claim ][of ][agricultural]income is not tenable. The [aforesaid ][frndings ][of ][fact ][are]based on meticulous [appreciation ][of ][evidence ][on ][record ][and]by no stretch of imagination [can ][be ][said ][to ][be ][perverse. ][It ][is]well settled in law that this Court [in ][exercise of powers ][under]Section 26Or\ of the Act cannot interfere [with ][the ][finding of]fact until and unless the same is demonstrated to be H r rwy8l - perverse. (see Syeda Rahimunnisa vs. Malan Bi by LRsl andPrincipal Commissioner of lncome Tax, BangalorevsSoftbrands India Private Limitedz). 10. In view of preceding analysis, the [substantial]question of law framed by this Court is answered against [the]assessee and in favour of the Revenue. 1 1 . In the result, we do not find any [merit ][in ][the] appeal. The same fails and is hereby [dismissed.] Miscellaneous applications, if [any ][pending, shall stand] closed. There shall be no order [as ][to ][costs.] gal-l.v.s.s.c.s.M. sARMJOINTGtsSION OFFICER //TRUE COPY// ION OFFICER t. The lncome Tax Appellate [Tribunal, ][Hyderabad ]['B' ][Bench']Hyderabad. To, z. The Commissioner [of ][lncome ][Tax ][(Appeals) ]- [Vl, ][12th ][Floor, ][Gagan]Vihar, M.J. Road, Hyderabad - [500001 ][Hyderabad]Vihar, M.J. Road, Hyderabad - [500001 ][Hyderabad] - 3. The lncome-tax Officer, [Ward -10(4), ][Hyderabad] 4. One CC to Mr. A.V.A. [Siva ][Kartikeya, ][Advocate ] 5. One CC to Mr. J.V. [Prasad ][Senior ][Standing ][Counsel for lncome ][Tax]Department {OPUCI 6. Two CD Copies DUgh\qr L (2ot6l 10 SCC 3152 (2OLq 406 rTR 513 HIGH COURT DATED:,0210112O25 ORDERlTTA.No.l27 of 2008 DISMISSING THE APPEAL l ilE l 6 c)4trtr\)(2 i J,\,il Z[25zo.\,+*,[],s;trr ;.ttl-'.;;''::----"