It is presumed that rental income belongs to financial year (FY) 2018-19 and is from a land which is situated in India and used for agricultural purposes. At the time of filing the tax return in ITR-2 form (assuming that agricultural income is more than ₹5,000 per annum), no specific documents are required to be submitted to the tax department.
However, in respect of exempt agricultural income (including rental income as above), details need to be disclosed in Schedule EI (exempt income) of the income tax return form. Such details include gross agricultural receipts, expenditure incurred on agriculture, and unabsorbed agricultural loss in the previous eight assessment years.
Further, where the net agricultural income, i.e., gross agricultural receipts less expenditure incurred on agriculture less unabsorbed agricultural loss in the previous eight assessment years, exceeds ₹5 lakh per annum, the following additional disclosures are required to be made in Schedule EI:
i. Name of the district along with PIN code in which agricultural land is located; ii. Measurement of agricultural land in acre; iii. Whether the agricultural land is owned or held on lease; and iv. Whether the agricultural land is irrigated or rain-fed.
With respect to documents required at the time of inquiry, if any, by the income tax department, please note that while there is no prescribed list of documents, you may be required to produce documents evidencing all aspects reported in your return, i.e., the income disclosed, exemptions or deductions claimed, and so on. In respect of agricultural income, the indicative list of documents may be pertaining to land acquisition or ownership, details and location as per municipal records, evidence of agricultural use, lease agreement, tenant details, rent receipts, bank statements (if rent was received through modes other than cash). The above list is illustrative in nature and the tax authorities may require additional documents or information at their discretion.