TMI Blog2020 (4) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... NCE [ 1983 (2) TMI 47 - ALLAHABAD HIGH COURT] , METAL METALS OF INDIA [ 2006 (11) TMI 630 - HIGH COURT OF PUNJAB HARYANA] and METAL METALS OF INDIA [ 2006 (11) TMI 630 - HIGH COURT OF PUNJAB HARYANA] when the Partner of the assessee firm accepted that he deposited the amount in the assessee firm as a share of his capital contribution and also explained the source of the deposits then the addition made in the hands of the assessee firm was not justified and if at all the A.O. was not satisfied from the explanation / source of the Partner, then the additions could have been made in the individual hands of the Partner if it was permissible under section 69 of the Act. In that view of the matter the addition made by the A.O. and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the grounds of appeal with the kind permission of Income Tax Appellate Tribunal, till the same is finally heard and disposed off. 3. From the aforesaid grounds it is noticed that the only grievance of the assessee relates to the addition of ₹ 11,00,000/- made in the hands of the assessee on account of capital contributed by one of the partner namely Shri Manoj Kumar. 4. Facts of the case in brief are that the assessee e-filed the return of income on 14/09/2010 declaring an income of ₹ 10,76,750/- which was processed under section 143(1) of the Income Tax Act, 1961 (hereinafter referred to as Act ). Later on the case was selected for scrutiny. 5. During the course of assessment proceedings the A.O. noticed that a sum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtunity for his cross examination was sought. The Ld. CIT(A) provided the copy of the statement of Shri Jagdish Chander to the assessee. In response, the assessee submitted that Shri Jagdish Chander seems to have inadvertently mentioned that the loan of ₹ 9,50,000/- was given to M/s Lucky Wines and actually it was given to Shri Manoj Kumar which was verifiable from his copy of Syndicate Bank Account. The Ld. CIT(A) asked the remand report from the A.O. The assessee also furnished the written submission which had been incorporated in para 4.2 and 4.3 of the assessment order, for the cost of repetition the same is not reproduced herein. The Ld. CIT(A) after considering the submissions of the assessee sustained the addition made by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 003] 126 Taxman 533 (P H) 10. In his rival submissions the Ld. Sr. DR strongly supported the orders of the authorities below. 11. We have considered the submissions of both the parties and perused the material available on the record. In the present case it is an admitted fact that the Partner of the assessee firm made the contribution towards his capital account and explained the source for the same. 11.1 On a similar issue the Hon'ble Madhya Pradesh High Court in case of CIT Vs. Metachem Industries (supra) held as under: Once it is established that the amount has been invested by a particular person, be he a partner or an individual, then the responsibility of the assessee-firm is over. The assessee-firm cannot ask t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ken by the Hon'ble Allahabad High Court in the case of CIT Vs. Jaiswal Motor Finance(supra) held as under: It there are cash credit entries in the books of the firm in which the accounts of the individual partners exist and it is found as a fact that cash was received by the firm from its partners then in the absence of any material to indicate that they were profits of the firm, it could not be assessed in the hands of the firm. Therefore, the Tribunal did not commit any error of law and rightly held that the deposits shown in its accounts were satisfactorily explained and that the onus placed on the assessee by section 68 had been duly discharged. 11.3 Similarly the Hon'ble Jurisdictional High Court in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profits of the assessee. It held that as such said credits could not be assessed as the income of the assessee in terms of section 68 but might be assessed in the individual hands of the partners, if it is permissible under section 69. 12. We therefore by keeping in view the ratio laid down in the aforesaid referred to cases are of the view that when the Partner of the assessee firm accepted that he deposited the amount in the assessee firm as a share of his capital contribution and also explained the source of the deposits then the addition made in the hands of the assessee firm was not justified and if at all the A.O. was not satisfied from the explanation / source of the Partner, then the additions could have been made in the indivi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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