TMI Blog2014 (6) TMI 476X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee had not furnished the addresses of the farmers from whom Cold storage rent is alleged to have been received as the assessee had been carrying on the business of cold storage for the last at least more than 10 years - no receipts in support of the receipt of rent from the farmers had been produced – thus, the order of the Tribunal is upheld – Decided against Assessee. - ITA No. 266 of 2013 (O&M) - - - Dated:- 18-3-2014 - Ajay Kumar Mittal And Anita Chaudhry,JJ. For the Appellant : Mr. S. K. Mukhi, Advocate For the Petitioner : Mr. Yogesh Putney, Advocate ORDER Ajay Kumar Mittal,J. 1. This order shall dispose of ITA Nos.266 and 267 of 2013, as according to the learned counsel for the parties, the issue involved in both the appeals is identical. However, the facts are being extracted from ITA No.266 of 2013. 2. ITA No.266 of 2013 has been preferred by the assessee under section 260A of the Income Tax Act, 1961 (in short, the Act ) against the order dated 1.6.2010, Annexure A.5 passed by the Income Tax Appellate Tribunal, Chandigarh Bench 'A', Chandigarh in ITA No.608/CHD/2009 for the assessment year 2003-04, claiming following substa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in concurring with the authorities below and thereby upholding the addition of Rs. 11,00,000/- in the hands of firm though the money belonged to individual partners as withdrawn by them from their account in firm for earlier years for which ample evidences were given in the form of ledger accounts and the books of the firm on the basis of gap in withdrawal and investment which is against well settled law by this Hon'ble Court in the case of Ghuna Ram and Sons in CWP No.163 of 1999 and CWP No.4999 of 2010? VI)Whether the finding of the Tribunal is perverse on facts and its opinion is unsustainable in law and the order of the Tribunal is legally unsustainable and bad in law and the ITAT has misdirected itself in being influenced by irrelevant factors and applying erroneous criteria while deciding the issue under Income Tax Act, 1961? 3. A few facts relevant for the decision of the controversy as narrated in ITA No.266 of 2013 are that the appellant is a partnership concern based at Yamuna Nagar. It is engaged in running cold storage. It filed its return of income for the assessment year 2003-04 declaring loss of Rs.5240/- which was processed and taken up for scrutiny. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel for the respondents besides supporting the findings recorded by the Assessing Officer, CIT(A) and the Tribunal submitted that several opportunities were provided to the assessee but the assessee had failed to produce any material. He also submitted that the books of account of the assessee were rejected and therefore, the addition made in the hands of the firm was justified. 8. It would be apposite to refer to the findings recorded by the Assessing Officer, the CIT(A) and the Tribunal. 9. The Assessing Officer vide order dated 30.12.2005, Annexure A.1 recorded as under:- As stated above, the alleged partners have no independent source of income. On the contrary, the firm is carrying out cold storage business for the last at least more than 10 years as itself admitted by the assessee firm. The assessee firm was specifically asked to furnish the addresses of the farmers from whom cold storage rent is alleged to have been received. Despite this specific requisition the assessee firm has failed to furnish the addresses of the alleged farmers. Moreover, no receipts in support of the alleged receipt of rent from the said farmers have been produced. It has been alleged that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty on the said unexplained entry. In the instant case the assessee has failed to discharge the onus by not producing the books of account for the years 1995-96 and 1996-97 relevant to assessment years 1996-97 and 1997-98. The Hon'ble Supreme Court in the case of Sumati Dyal vs. CIT 214 ITR 801 has held that where any sum is found credited in the books of account for any preceding year the same may be charged to income tax as the income of the assessee of that year, if the explanation offered by the assessee about the nature and source thereof is in the opinion of Assessing Officer not satisfactory, in case there is prima facie evidence against the assessee. In the present case there is prima facie evidence against the assessee. The assessee firm did not produce the books of account for the years 1995-96 and 1996-97 from where the amounts alleged to have been withdrawn by the partners. The partners did not confirm the introduction of amount in their respective capital account. The books of account maintained by the assessee are not reliable and deserves to be rejected. It has been contended that there was dispute with the (sic) which was settled before 7.11.2002 and the mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the partners remains unexplained and the addition is confirmed. 11. The Tribunal vide order dated 1.6.2010, Annexure A.5 in appeal held as under:- We have examined the aforesaid plea set up by the appellant. In principle, we are in agreement with the plea of the assessee that where a partner admits to have made deposits with the firm, then as far as the firm is concerned, even if the source of the partner is held to be unexplained, such amount cannot be subjected to tax in the hands of the assessee firm. So however, in the present case, the facts stand on a different footing. Firstly, the proposition advanced by the appellant is based on a premise that the partners concerned have confirmed the introduction of cash by them. In the present case, the finding of the Assessing Officer in the assessment order is that the partners, at no stage of the proceedings have ever confirmed the introduction of cash by them and even before the CIT(Appeals), as is evident from the extract reproduced above, the assessee did not produce any confirmation from the concerned partners. In fact, the CIT (Appeals) allowed opportunity to the assessee to produce the partners so that actual position ..... X X X X Extracts X X X X X X X X Extracts X X X X
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