COMMISSIONER OF INCOME TAX Vs. PRADEEP KUMAR GUPTA

JUDGEMENT

(1.) THE Revenue has filed these appeals against the order of the Income -tax Appellate Tribunal (Tribunal) deleting the agricultural income in the sum of Rs. 4,34,000 declared by Shri Pradeep Kumar Gupta and Rs. 4,55,700 declared by Shri Vijay Gupta, respectively. Both these assessees had also assailed the validity of the assumption of jurisdiction by the AO under ss. 147 and 148 of the IT Act.

(2.) THE case of the Revenue is that the AO had received information from the Dy. Director of IT (Inv.), Faridabad that while carrying out post -search enquiries relating to a third party, Shri Anand Prakash, the sole proprietor of M/s Jai Trading Co. had deposed that he was providing bogus/false transactions purporting to relate to sale/purchase of foodgrain items and that the cash deposits with him were from parties who had approached him for 'accommodation entries' in the form of agricultural receipts. The enquiries with the banks on whom cheques were drawn and credited in the account of M/s Jai Trading Co. showed that the assessees in the present cases were also the beneficiaries of such illegal transactions.

(3.) BASED on the sworn statement of Shri Anand Prakash, reassessment proceedings against the assessees under s. 147/148 were initiated. The assessees had stated that they had taken agricultural land on lease from Shri Mool Chand and the rent had been paid in cash. Shri Mool Chand has appeared and affirmed this statement. The assessees have further claimed that this land had been cultivated by them through Shri Kishan Kumar of Hapur. Opportunities were granted by the AO to the assessees for production of Shri Kishan Kumar, which have not been availed of by them. Instead, the assessees have put forward a wholly incredulous and incongruent statement that Shri Kishan Kumar could demanded an opportunity to cross -examine Shri Anand Prakash, but this was declined on the ground that the statement of this person had been recorded by the Dy. Director of IT (Inv.), Faridabad. Further, while the assessees do not deny that they have sold produce to M/s Jai Trading Co., and have submitted copies of the bills issued by the latter, they maintain that these sales were genuine.