Commissioner of Income Tax vs Mrs. Kulandai Theresa

K. Raviraja Pandian, J.—The revenue on appeal against the order of the Income Tax Appellate Tribunal, Madras ''D'' Bench, Chennai,

dated 30.06.2008 passed in IT(SS)A No. 71/Mds/2004.

The facts as culled out from the statement of facts in the memorandum of grounds of appeal are as follows:

A search took place in the residential and business premises of Late Shri. C. Sudalaimani Nadar, Eral on 07.07.1999 u/s 132 of the Income Tax

Act, 1961, which revealed various investments, expenditure, movable and immovable assets. The assessing Officer initiated proceedings u/s

158BC and after examining the books of accounts and other information gathered during search, determined the undisclosed income at Rs.

30,50,630/-. On appeal, the Commissioner of Income Tax (Appeals) estimated the agricultural income and non-agricultural income and deleted

the addition to that extent for the reason that the assessee had not disclosed his agricultural income as well as non-agricultural income to the full

extent in the regular return of income filed and on that basis the undisclosed income was determined at Rs. 9,15,490/-. Both the revenue as well as

the assessee filed appeal and cross-appeal before the Tribunal. The Tribunal upheld the order of the Commissioner of Income Tax (Appeals) on

the ground that the assessee had suppressed not only his non-agricultural income, but also his agricultural income. Therefore, when the undisclosed

part of the non-agricultural income is worked out, it is incumbent upon the Commissioner of Income Tax (Appeals) to give credit for the

undisclosed part of the agricultural income and dismissed the appeal filed by the revenue. The same is now put in issue by formulating the following

question of law:

Whether on the facts and circumstances of the case, the Tribunal was right in confirming the CIT(A) order when the CIT(A) has failed to estimate

the agricultural income of the assessee considering the extent of lands and the agricultural income admitted by the assessee in his regular return of

income?.

We heard the arguments of the learned Counsel for the revenue and perused the materials available on record.

There is no doubt that the agricultural income is an exempted income for the purpose of Income Tax. The Commissioner of Income Tax

(Appeals) has reasonably established on examination of the materials available before him that the assessee had suppressed not only his non-

agricultural income but also his agricultural income. Therefore, when the undisclosed part of the non-agricultural income is worked out, it is lawfully

incumbent upon the officer concerned to give credit for the undisclosed part of the agricultural income. That is what exactly done in this case. We

find no merit in this appeal so as to entertain the same. Hence the appeal is dismissed.