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2016 (6) TMI 112 - HC - Income TaxAddition of unexplained cash credits - Held that:- Section 68 of the Act stipulates that, where any sum is found credited in the books of an assessee maintained for any previous year and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income tax as the income of the assessee of that previous year. In the present case, the assessee is a partnership firm. The cash credits of ₹ 94,46,903/- have been explained by the firm as capital introduced by Sri Ch.Rajendra Kumar. If Sri Ch.Rajendra Kumar was unable to explain the source of funds, for his investment as capital in the partnership firm, the Assessing Officer would have been justified in adding these unexplained cash credits to the income of Sri Ch.Rajendra Kumar in his individual assessment. That, however, did not justify adding these cash credits of ₹ 90,46,903/- to the income of the firm as these credits have been explained by the firm as having been introduced as capital by Sri Ch.Rajendra Kumar, a partner.
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