Ajesh Kumar Agrawal v. Commissioner of Income-tax, Circle-1, Jaipur
[Citation -2017-LL-1023-9]

Citation 2017-LL-1023-9
Appellant Name Ajesh Kumar Agrawal
Respondent Name Commissioner of Income-tax, Circle-1, Jaipur
Court HIGH COURT OF RAJASTHAN
Relevant Act Income-tax
Date of Order 23/10/2017
Judgment View Judgment
Keyword Tags agricultural operation • compulsory acquisition • agricultural produce • agricultural land • compensation • capital gain
Bot Summary: 10(37) of the IT Act on the compensation received by the Assessee in respect of ITA-221/2016 its land acquired by RIICO and making Addition of Rs.1,30,33,036/- as Capital Gain by considering a Khasra Girdavari which does not disclose the information for growing of crop during two years immediately preceding the date of transfer 3. The assessee produced Kastagar namely Shri Hemraj Sharma alongwith his affidavit which has been examined by the Assessing Officer but has not has able to demonstrate that he really cultivated the land. Further the admissible evidence to prove the agricultural activity carried by the ITA-221/2016 assessee, is Khasra Girdawari, no any certificate from the Sarpanch of the village, which is also contradictory and he openly accepted that this certificate was given by him at the behest of the assessee. At the outset the ld AR of the assessee has submitted that the ld Assessing Officer estimated the household without any basis and brought on record contrary evidence. The revenue records produced by the assessee before the authorities also indicated that there was plantation of Eucalyptus saplings. What is to be considered is that for being granted benefit under sub-section of Section 10 of the Act, the land in question should have been put to agricultural use by the assessee for the preceding two years. The Tribunal has further examined the issue and held that if at all there was any agricultural activity being carried on by the appellant in the previous two years, some accounts with regard to expenditure made by the appellant for sowing the crops and also revenue generated by selling the agricultural produce would have been submitted by the assessee, which has not been done by him.


HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 221 / 2016 Ajesh Kumar Agrawal, Khandaka Bhawan, Bordi Ka Rasta, Jaipur ----Appellant Versus Commissioner of Income Tax, Circle-1, Central Revenue Building, Department of Income Tax, Statue Circle, C-Scheme, Jaipur ----Respondent For Appellant(s) : Mr. S. L. Poddar with Mr. N. L. Agarwal For Respondent(s) : Mr. Anuroop Singhi with Mr. Aditiya Vijay HON'BLE MR. JUSTICE K. S. JHAVERI HON'BLE MR. JUSTICE VIJAY KUMAR VYAS judgment 23/10/2017 1. By way of this appeal, appellant has challenged judgment and order of Tribunal whereby Tribunal has partly allowed appeal of department and assessee s C.O. has been dismissed. 2. This court while admitting appeal on 31.01.2017 framed following questions of law:- (i) Whether Ld. ITAT was justified under law while reversing findings of Ld. CIT(A) in respect of granting of relief of Rs.56,94,231/- exemption u/s 10 (37) of Act of 1961 by considering Khasra Girdavari Report dated 05.12.2011 integral part of order of Assessment as Annexure-A not furnishing information in respect of growing of Crop on agricultural land during year 2007-08? (ii) Whether Ld. AO was justified under law to denying exemption u/s. 10(37) of IT Act on compensation received by Assessee in respect of (2 of 6) [ITA-221/2016] its land acquired by RIICO and making Addition of Rs.1,30,33,036/- as Capital Gain by considering Khasra Girdavari which does not disclose information for growing of crop during two years immediately preceding date of transfer? 3. Counsel for appellant contended in view of provision Section 10(37)(ii) of Income Tax Act which reads as under:- In case of assessee, being individual or Hindu individual family, any income chargeable under head Capital gain arising from transfer of agricultural land, shall be exempted, where : Such land is situate in any area referred to in, item (a) or item (b) of sub-clause (iii) of clause (14) of Section 2 Such land, during period of two years immediately preceding date of transfer, was being used for agricultural purposes by such Hindu undivided family or individual, or parent of his Such transfer is by way of compulsory acquisition under any law, or transfer consideration for which is determined or approved by Central Government or Reserve Bank of India Such income has arisen from compensation or consideration for such transfer received by such assesses on or after 1st day of April, 2004. It may be noted in this connection that exemption is available only if compulsory acquisition has taken place on or after 1-4-2004. Exemption is also available if acquisition has taken place before 1-4-2004 but compensation has been received on or after 1-4-2004. For purposes of this clause, expression, compensation or consideration includes compensation or consideration enhanced or further enhanced by any court, tribunal or other authority. 4. He contended that this is only condition which was not fulfilled by appellant therefore, same is required to be viewed closely. He contended that land was acquired on 4 th July, 2008 therefore, agricultural use is to be considered as under:- (3 of 6) [ITA-221/2016] Khasra No. F.Y. 2005- F.Y. 2006- F.Y. 2007- F.Y. 2008- 06 Samvat 07 Samvat 08 Samvat 09 Samvat 2062-63 2063-64 2064-65 2065-66 196 0.27 Patat (...) Patat Banjad(...) Hectare Wheat 199/453 0.11 Banjad Banjad Banjad Hectare Banjad 206 0.02 Patat Patat Patat Hectare Patat 458/195 0.23 Banjad Banjad Banjad Hectare Patat 459/195 0.30 Banjad Banjad Banjad Hectare Patat 465/198 0.79 Banjad Banjad Banjad Hectare Patat 198 0.11 Wheat Wheat Wheat Hectare Patat 461/195 0.70 Teell Till Patat Hectare Patat 460/195 0.50 Teell Till Patat Hectare Patat 197 Kua in Kua Kua Kua name of Shri Ramkishor (4 of 6) [ITA-221/2016] e Agarwal 5. He further contended that Tribunal has seriously committed error in not considering earlier year namely, financial Year 2005-06 Samvat 2062-63 and has considered agricultural income. He contended that Tribunal has committed error in reversing view taken by CIT(A) and has relied upon observation made by CIT(A) and contended that CIT(A) while considering matter has rightly partly allowed appeal of assessee. 6. Counsel for respondent has relied upon decision of Tribunal wherein it has been observed as under:- 7. We have heard rival contentions of both parties and perused material available on record. As per Section 10(37)ii) of Act, such land, during period of two years immediately preceding date of transfer, is being used for agricultural purposes by such Hindu undivided family or individual or of parent of his;thus assessee has to put this land in immediately preceding two years in agricultural operation for claiming benefit of Section 10(37) of Act. assessee produced Kastagar namely Shri Hemraj Sharma alongwith his affidavit which has been examined by Assessing Officer but has not has able to demonstrate that he really cultivated land. There was no evidence with him or with assessee that there was irrigation facility available on that land and incurred expenditure for cultivating agricultural activities on it. assessee also has not able to produce any authentic evidence of sale proceeds from mandi before lower authorities. ld CIT(A) also wrongly appreciated fact that in Samvat 2064-65 (F.Y. 2007-08), assessee cultivated khasra No. 198, 461/195 and 460/195. On verification of copy of Khasra Girdawari available in paper book, which does not show any agricultural activity in Samvat 2064-65 relevant to F.Y. 2007-08. Further admissible evidence to prove agricultural activity carried by (5 of 6) [ITA-221/2016] assessee, is Khasra Girdawari, no any certificate from Sarpanch of village, which is also contradictory and he openly accepted that this certificate was given by him at behest of assessee. He did not know exact land of assessee where situated. Therefore,we have considered view that assessee s claim proportionately allowed by ld CIT(A) is not justified. Accordingly, we reverse order of ld CIT(A) and revenue s appeal is allowed on this ground. 11. At outset ld AR of assessee has submitted that ld Assessing Officer estimated household without any basis and brought on record contrary evidence. He relied on decision of Hon ble ITAT Jodhpur Bench in case of ITO Vs. Dr. Anand Chabra 37 Tax World 72 wherein it has been held that Assessing Officer has not given any basis for estimating household expenses, addition made cannot be sustained. He further relied on decision of ITAT, Jaipur Bench in case of Mahaveer Singh Sankhla Vs DCIT 177 TTJ (JP)(UO) 1 wherein it has been held that onus is on revenue to prove that assessee had incurred expenditure much more than debited by assessee, therefore, he prayed to uphold order of ld CIT(A). 7. He relied upon decision of Karnataka High Court in B. M. Muniraju V/s Commissioner of Income Tax(Appeals)-V, Bangalore [2016] 282 CTR 108 (Karnataka) wherein it has been held as under:- 7. Even otherwise, we notice from records that subsequently certain certificates came to be issued by revenue authorities in year 2012 to indicate that there was agricultural crop of Jowar on plot in year 2005-06 as well as 2006-07 and in year 2007-08. revenue records produced by assessee before authorities also indicated that there was plantation of Eucalyptus saplings. Thus, even on facts, records are inconsistent or contrary to each other that there was plantation of Eucalyptus saplings. What is to be considered is that for being granted benefit under sub-section (37) of Section 10 of Act, land in question should have been put to agricultural use by assessee for preceding two years. Even if we accept (6 of 6) [ITA-221/2016] contention of appellant that he was in possession of land for two years from 27.07.2006 to 07.10.2008, then too, from records it is not at all clear that for both years appellant was carrying out agricultural activity in land in question. Tribunal has further examined issue and held that if at all there was any agricultural activity being carried on by appellant in previous two years, some accounts with regard to expenditure made by appellant for sowing crops and also revenue generated by selling agricultural produce would have been submitted by assessee, which has not been done by him. same is also strong ground for not accepting that appellant was carrying on agricultural activity on plot in question. 8. Clear findings of fact have been recorded by all three authorities, which in our view, do not require to be interfered with by this Court in appeal. As such, we are of view that since finding of fact has been given by all authorities that appellant was not carrying on any agricultural activity in plot in question in preceding two years prior to 07.10.2008, appellant would not be entitled to benefit of Section 10(37) of Act. 8. We have heard learned counsel for parties. 9. Taking into account observations made by Tribunal in Para 7 and 11 as reproduced above, we are in complete agreement with view taken by Tribunal. 10. issues are decided against assessee and in favour of department. 11. appeal stands dismissed. (VIJAY KUMAR VYAS),J. (K.S.JHAVERI),J. B.M.G/Gourav/34 Ajesh Kumar Agrawal v. Commissioner of Income-tax, Circle-1, Jaipur
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