आयकर अपीलीय न्यायाधिकरण में , हैदराबाद ‘ए’ बेंच , हैदराबाद IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘ A ‘ Bench, Hyderabad , , श्री विजय पाल राि माननीय उपाध्यक्ष एिं श्री मंजूनाथ जी माननीय लेखा सदस्य SHRI VIJAY PAL RAO, HON’BLE VICE PRESIDENT AND SHRI MANJUNATHA G, HON’BLE ACCOUNTANT MEMBER आयकरअपीलसं./I.T.A.No.1362/Hyd/2024 (निर्धारण वर्ा/ Assessment Year: 2018-19)

Classic Bio-Tech Exports Vs. The Income Tax Officer, Limited, Ward -1(1), Hyderabad.

Bangalore.

PAN : AAACC8167D (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent)

करदाता का प्रतततितित्व/ : Shri Avinash Maliya, Advocate Assessee and Shri Joseph Varghese, Represented by Advocates.

राजस्व का प्रतततितित्व/ : Ms. G. Saratha, Sr. A.R.

Department Represented by सुिवाई समाप्त होिे की ततति/ : 26.11.2025 Date of Conclusion of Hearing घोर्णध की तधरीख/ : 10.12.2025 Date of Pronouncement

O R D E R

PER MANJUNATHA G., A.M :

This appeal filed by the assessee is directed against the order of the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [in short “NFAC”], Delhi, dated

01.10.2024, pertaining to the assessment year 2018-19.

2. The brief facts of the case are that, the assessee is a domestic company engaged in agricultural activities, filed its return of income for A.Y. 2018-19 on 28.03.2019, declaring total income nil and net agricultural income of Rs. 39,42,060/-. The case was selected for scrutiny and during the course of assessment proceedings, the A.O. noticed that, the assessee has reported gross agricultural receipts of Rs. 72,84,186/- and whereas the expenditure incurred on agricultural activities was at Rs. 33,42,126/- before reporting net agricultural income of Rs. 39,42,060/-. The A.O. called upon the assessee to file relevant evidences, including landholding details, details of agricultural operations carried out in land, crops grown, details of sale of agricultural produce and expenditure incurred for agricultural operations, etc. In response, the assessee submitted that, the company was into the business of agricultural activities and growing vegetables like capsicum, green chilli, carrot etc., in a Poly House. The assessee has also furnished the details of land held by the director of the assessee company Shri N.S. Rama Raju and N.

Rama Sita, P. Shri Lakshmi, N. Jhansi Rani and others and claimed that, the company had taken lands on lease from the directors and carrying out agricultural operations. The assessee has also furnished bills and vouchers in respect of expenditure incurred for agricultural operations.

3. The A.O. after considering relevant submissions of the assessee observed that, the land claimed to have been owned by the assessee company are held in the name of different persons. Further, the assessee has failed to file any evidences to prove that, the land was taken on lease by the assessee company. The A.O. further noted that, although the assessee claims to have employed fixed assets for carrying out agricultural operations and also spent amount for constructing Poly House, but as per the financial statements of the year, there were no fixed assets in the books of account of the assessee. The assessee had also furnished hand made vouchers of agricultural expenses, however, failed to furnish any bills for sale of agricultural produce except filing electricity bills pertaining to Smt. N. Rama Sitha. Therefore, the A.O. observed that, the assessee has failed to substantiate the carrying out of agricultural operations and the agricultural income of Rs.

39,42,060/- claimed by the assessee. Therefore, rejected the explanation of the assessee and assessed the amount claimed as agricultural income under Section 69C of the Income-tax Act, 1961 as unexplained expenditure.

4. Aggrieved by the order of assessment, the assessee preferred the appeal before the Ld. CIT(A). Before the Ld. CIT(A), the assessee has reiterated the submissions made before the A.O. and claimed that, the assessee company was engaged in the activity of agricultural