INCOME TAX ACT, 1961

Section 68

Income from undisclosed source - Addition under section 68 - Undisclosed income introduced in the form of agricultural income -

Assessee was engaged in agricultural activity. AO while completing the scrutiny assessment under section 143(3) held that assessee had shown an expenditure for earning the gross agricultural income which was unrealistic and unreasonably low. AO accordingly estimated the expenditure @ 30% of gross agricultural income and difference amount was treated as undisclosed income of assessee. CIT(A) estimated the expenditure at 15% as against 30% estimated by AO. Held: CIT (A) had taken a reasonable percentage of 15% expenditure of the gross agricultural income and that too the agricultural income from agricultural operations excluding the income from sale of trees. Hence, in the facts and circumstances of the case, claim of assessee could not be accepted. Thus appeal of assessee was dismissed.

REFERRED : State (Delhi Administration) v. Gulzari Lal Tandon 1979 AIR 1382 (SC) J.A. Naidu, Etc. v. State Of Maharashta 1979 AIR 1537 (SC) Umacharan Shaw & Bros. v. CIT (1959) 37 ITR 271 (SC) : 1959 TaxPub(DT) 0184 (SC) and Dhakeswari Cotton Mills Limited v. CIT (1954) 26 ITR 775 (SC) : 1954 TaxPub(DT) 0123 (SC)

FAVOUR : Against the assessee

A.Y. :

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