9911796707
TMI Blog2021 (8) TMI 1096X X X X Extracts X X X X X X X X Extracts X X X X ..... e present is a company which is engaged in the business of wholesale trading. The return of income for the year under consideration was filed by it on 31.03.2017declaring atotal income of Rs. 48,550/-. Although the said return was initially processed by the AO u/s 143(1) of the Act, it was subsequently selected for scrutiny through CASS. During the course of assessment proceedings, the assessee was required by the AO to explain the source of cash in hand of Rs. 29,87,730/- appearing in the balance sheet as on 31.03.2015. In reply, the main source as unexplained on behalf of the assessee firm was the contribution made by its partners towards capital accounts. The details of the same were also furnished on behalf of the assessee firm and from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e discrepancies no explanation was furnished by the appellant before the AO. Thus the difference of Rs. 2,69,013/- remains unexplained and the action of the AO is found to be justified. The other issues relates to disallowance of a sum of Rs. 24,00,000/- by invoking section 68 of the Act. I find that the appellant's accounts are audited and addition is made purely on estimate basis without any specific findings. I find that all entries are reflected in the regular books of accounts and confirmation of partners has also been filed along with their Income Tax Return and computation sheet and Balance Sheet. I find that the AO has not pointed out any defect in the submissions made by the AR and before me the appellant has filed complete detai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ddition to that extent to the total income of the assessee u/s 68. In my opinion, the main source of cash in hand of Rs. 29,87,730/- was explained by the assessee as capital contribution made by its partners to the extent of Rs. 28,30,987/- and since the said source was clearly established on the basis of cash book showing introduction of capital by the partners, I am of the view the difference of Rs. 2,69,013/- as pointed out by the AO in the total capital contribution as claimed by the assessee to the extent of Rs. 31,00,000/- was not relevant to the issue and such shortfall cannot be treated as income u/s 68 in the hands of the assessee firm by treating the same as unexplained cash credit. The issue was relating to the source of cash in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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