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2022 (6) TMI 413 - AT - Income TaxAdditions of unsecured loan - unexplained partners capital - settlement petition before the Hon'ble Settlement Commission, in respect of the capital and loan introduced in the appellant firm by individual partners - Assessee stated that capital introduced by the partners cannot be treated as unexplained under the provision of section 68 as the partners has confirmed the introduction of such capital - HELD THAT:- Substantial ground No.1 is covered in favour of the assessee by the decision in the case of PCIT Vs Vaishnodevi Refoils & Solvex [2018 (1) TMI 861 - GUJARAT HIGH COURT] wherein it was held that capital introduced by one partner of the firm, in view of the fact that it is duly reflected in books of account maintained by the concerned partner and confirmed by such partner the impugned addition is liable to be set aside. We find that three partners of assessee-firm who contributed capital, are close family members. Thus, they are not stranger and their identity is not in dispute. The partners have not disputed the capital contribution. Further it is not in dispute that the partners who had contributed capital have filed petition before ITSC Mumbai and their settlement petition has not been dismissed or the proposal is not declined. As assessee furnished the details of capital introduced by partners of the firm and the partner has confirmed such contribution, it could be concluded that the assessee has discharged its onus cast upon it. If the assessing officer was not convinced about the creditworthy of the partner, who made capital contribution, enquiry had to be made against such partner and not against firm. Thus, in view of the facts and the legal position, that when the addition under section 68 is liable to be set aside. In the result, substantial ground No. 1 of the appeal is allowed. Addition of unsecured loans - Considering the submissions of ld. AR for the assessee, this issue is restored back to the file of assessing officer to verify the fact that if the unsecured loan is owned by M D Patel in his petition file before ITSC, the additions be deleted. So far as transaction of loan from Kaushik Granites Pvt Ltd is concerned, the assessee has filed complete details like confirmation of party, name, PAN and address, hence, we admit the said documents as additional evidence being relevant for determination of the issue in hand, and also restore this part of the issue direct to the assessing officer to consider those evidence and pass speaking order in accordance with law. Needless to direct that this case relates to AY 2003-04, the assessing officer shall pass the order as early as possible, off course after granting due opportunity to the assessee. The assessee is also directed to provide all information and necessary evidences and documents to the assessing officer and not to linger on the proceedings. In the result, this ground of appeal is allowed for statistical purpose.
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