Ganesh Vasudeva Shet Vs ITO (ITAT Bangalore)
ITAT Bangalore held that as per provisions of section 44AA of the Income Tax Act, an agriculturist is not required to maintain books of accounts. Further, revenue has failed to establish anything contrary, accordingly, addition made on this count deleted.
Facts- The assessee is an individual and is a partner in two partnership firms. The assessee is also an agriculturist. It is submitted that the assessee is regularly assessed to tax. The assessee for the year under consideration filed its return of income on 04.01.2019 declaring total income of Rs. 11,86,040/- and Net agriculture income of Rs.81,45,189/-. AO noted that the return was filed u/s. 139(4). AO completed assessment u/s. 143(3) r.w.s. 143(3A) & 143(3B) of the Act on 17.02.2021, wherein Rs. 81,45,189/- claimed as agriculture income in the return was added as unexplained income from undisclosed sources.
CIT(A) confirmed the addition of the sale of produce only to the extent of Rs.9,29,559/- for want of documentary evidences. CIT(A) further disallowed expenditure to an extent of 25% of the gross receipts and made further addition of Rs.13,58,740/-. Being aggrieved, the present appeal is filed.
Conclusion- Held that we refer to the provisions of section 44AA of the Act that fortifies further that an agriculturist is not required to maintain books of accounts. We further note that the revenue has anyway not brought anything on record to establish that the assessee had any other source of income other than the agricultural income in order to disallow Rs. 9,29,559/- under any other head. Admittedly, assessee has established by way of documentary evidences the sale made to MACOS and CAMPCO Ltd. during the year. It is only to the extent of Rs.9,29,559/- that no documentary evidences could be furnished as the produce were sold in the open market. As the revenue has failed to establish anything contrary and that admittedly assessee only had agricultural income during the year, we do not find any reason to disbelieve the submissions of the assessee. Accordingly, we direct AO to delete the addition made on this count.
