TMI Blog2017 (2) TMI 1307X X X X Extracts X X X X X X X X Extracts X X X X ..... ted:- 13-2-2017 - SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER SHRI S. S. GODARA, JUDICIAL MEMBER Appellant by : Shi K. Madhusudan, Sr. D.R. Respondent by : Ms. Urvashi Sodhan, A.R. ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. This appeal by the Assessee is directed against the order of Ld. CIT(A)-IV, Ahmedabad dated 12.10.2006 pertaining to A.Y. 2005-06. 2. The only grievance of the revenue is that the ld. CIT(A) erred in law and on facts in deleting the addition of ₹ 1,05,46,160/- made on account of capital introduced by the partner of the Shri Kantilal Jayramdas Thakkar u/s. 68 of the Act. 3. Briefly stated the facts of the case are during the course of the assessment proceedings, the A.O. noticed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd to the partner s capital introduction in the hands of the partnerships firm. The First Appellate Authority was convinced with the claim of the assessee and deleted the impugned addition. 6. Before us, the ld. D.R. strongly supported the findings of the A.O. The ld. counsel once again relied upon the decision of the Hon ble Jurisdictional High Court of Gujarat given in the case of Pankaj Dyestuff Industries in Income Tax Reference No. 241 of 1993. 7. We have carefully perused the orders of the authorities below. We find that the Hon ble Jurisdictional High Court in the case of Pankaj Dyestuff Industries (supra) has relied upon the decision of the Hon ble Bombay High Court in the case of Narayandas Kedarnath 22 ITR 18. The relevant p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... left the firm earlier and returned-through the intermediary of the partners. If the department was not satisfied with the explanation given by the partners then it is legitimate for the department to draw an inference that these amounts represent undisclosed profits of the partners and to assess them in their own individual assessment. The aforesaid decision in the case of Narayandas Kedarnath (supra) rendered by Bombay High Court on 28th March 1952 has precedential value equivalent to a decision of this Court and hence, is equally binding on this Court. The said decision though rendered under the Indian Income Tax Act, 1922, would not make any difference. Section 68 of the Act was introduced for the first time in the Act and there was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s deposited in their accounts are their own, the Income Tax Officer is entitled to and may proceed against the partners and assess the same in their hands, if their explanation is not found satisfactory. 14.In the facts and circumstances of the present case both the Deputy CIT (Appeals) and the Tribunal have found that the assessee had discharged the primary onus which was on it by offering explanation, which has not been found to be incorrect or false in any manner. The interest of the revenue is also safeguarded as the Income Tax Officer has been given the liberty to consider the said-credits in the hands of the partners if he is not satisfied with the sources of investment of cash credits in the accounts of the partners. 15.In thes ..... X X X X Extracts X X X X X X X X Extracts X X X X
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