A case has come to light from Bengaluru, in which the court has given relief to a farmer selling mangoes. On October 30, 2025, the Income Tax Appellate Tribunal (ITAT) Bangalore Bench gave an important decision. In this decision, the decision was taken in favor of farmer Mr. Kanana and the notice of the tax department was cancelled. Actually, the tax department had accepted that the farmer had misrepresented the income from the sale of mangoes. But ITAT said that this notice of the tax officer was made on the basis of estimates. There was a lack of concrete evidence in this.
How did the matter begin?
Mr. Kanana had 22.24 acres of agricultural land, where he cultivated mangoes and some other fruits. He filed his income tax return for the financial year 2019-20 (AY 2020-21) on 1 February 2021. In the return, he declared his total income as Rs 48,58,140, of which Rs 1.85 crore was from the sale of mangoes and fruits. Seeing this, the tax department selected the case for investigation under CASS (Computer Assisted Scrutiny Selection), because such a huge agricultural income seemed unusual.
Tax officer’s suspicion
During the investigation, the tax officer sent the verification unit to find out whether the farmer had actually done farming or not. The report confirmed that cultivation had indeed been done, and that there was a mango crop on the land. However, the report said that the average production was 34 tonnes per acre and the average price was between Rs 7,00010,000 per tonne. Based on this, he estimated that the total sale of the farmer could be Rs 9.6 lakh per acre.
tax officer’s mistake
The tax officer said on the basis of articles found on the internet that the average price of mango in Andhra Pradesh is Rs 45,000 per tonne. According to this, he considered the farmer’s total sales to be Rs 43,20,000 and expenses to be Rs 21,60,000. He declared the remaining Rs 1.2 crore as unexplained cash deposits and considered it taxable under Section 68.
The farmer appealed
The farmer’s chartered accountant Thirumala Naidu appealed to the CIT against this decision. In the appeal, he told that the prices of mangoes change every year and according to every variety. For example, juicy mangoes are sold cheap, while premium varieties are expensive. CIT (A) admitted that it is difficult to accurately estimate the prices of mangoes unless the variety and quality are known. Therefore the CIT (A) canceled the addition of Rs 1.2 crore made by the tax officer.
What did ITAT say in favor of the farmer?
ITAT Bangalore, in its decision dated October 30, 2025, said that the farmer had given affidavits of four contractors, which were not found false by the tax officer. The report of the verification unit also proved that farming was done on the land. The expenditure reported by the farmer as Rs 41 lakh was more than the tax officer’s estimated expenditure of Rs 21 lakh. Therefore, ITAT held that the income of the farmer is correct and the notice of the tax department was wrong.
Expert opinion
Mihir Tanna, Associate Director (SK Patodia LLP), said in an ET report that this case makes it clear that if a taxpayer submits all the necessary documents and evidence, the department should not take action against him merely on the basis of data found on the internet.