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2012 (8) TMI 127 - AT - Income TaxDenial of claim of deduction of partnership remuneration and interest - the status of appellant has to be taken as AOP - Held that:- it has to be necessarily held that no genuine partnership firm was in existence during the previous year 2007-08 as evidenced by a partnership deed executed since the beginning of the financial year. So also, the remuneration claimed for both the partners are again not in conformity with the statutory provision as being not authorized by the partnership deed executed and applicable from the beginning of the financial year. Thus, the AO's action in taking the status of the appellant as AOP and disallowing the deduction of remuneration and interest aggregating Rs.2,56,628/- is found to be fully justified both on facts and in law and accordingly confirmed - against assessee. Addition of income on loan of Rs. 20 lacs received from Mohd. Zakir Hussain, partner of the assessee firm CIT(A) deleted the same after observing that the amount was received from the partner whose identity was established and the amount was received from banking channel - Verifying the passbook of savings bank account of Shri Mohd. Zakir Hussain credit balance in the savings bank account amounting to Rs.34,28,415/- out of which Shri Mohd. Zakir Hussain issued the cheque of Rs. 20 lacs in favour of the firm, clearly proves the credit worthiness - CIT(A) was correct in deleting the addition made on account of loan received from the partner - in favour of assessee. Not being able to prove genuineness of transaction and credit worthiness in respect of the loan of Rs. 5 lacs each received from Jivanlal, Premlal, Ramkumar and Laxminarayan,no reason to interfere with the findings in confirming the credit received from these persons, accordingly - against assessee. Disallowance of claim of expenditure on account of details of Tools, Auzar and Tagari - Held that:- This expenditure is essentially required to be allowed as revenue expenditure as they are the consumables used in the business of construction life of which is less than one year - in favour of assessee. Confirm the action of the CIT A) in assessing the income of Rs.60,85,200/- in place of total income assessed by the Assessing Officer at Rs.1,57,94,180/-.
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