TMI Blog2022 (10) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... or allowance against the revenue during the year or in the past. The assessee still remains the partner in the partnership firm M/s. Baba Baidyanath Constructions which is regularly filing the income tax return and the copies of the same for AY 2013-14, 2015-16 are placed in the paper book. The said adjustment of transferring the loan into the capital is between the assessee and the partnership firm. Had the assessee treated it as a part of the capital in the preceding year when the amount was actually withdrawn from the partnership firm, the present situation would not have arrived. We are of the considered view that ld. AO was not justified in invoking the provisions of Section 41(1) of the Act on the alleged transaction and thus, we fail to find any infirmity in the finding of CIT(A) deleting the said addition. Thus, ground no. 2 raised by the Revenue stands dismissed. Addition invoking the provisions of Section 68 - HELD THAT:- We find that the assessee being a partner of M/s. Baba Baidyanath Constructions which is regularly filing income tax return, the assessee in order to procure contracts in the business in his individual name withdrew the sum from the partnership ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ke into account the material evidence brought on the record by the Assessing officer. 2. That regarding the addition made to the tune of Rs. 94,71,000/- under the head increase in capital, the Ld.CIT (A) Hazaribag, erred in deleting the addition. The Ld.CIT (A) Hazaribag, relied upon the evidence put forwarded by the assessee before him in this regard and did not take into account the fact brought on the record by the Assessing officer during the course of assessment proceedings. The Ld.CIT (A) Hazaribag, relied upon some judicial pronouncements and deleted the said addition. 3. That regarding the addition made to the tune of Rs. 46,86,305/- U/s 68 of I.T. Act, the Ld.CIT (A) Hazaribag, erred in deleting the addition. The Ld.CIT (A) Hazaribag, relied upon the evidence put forwarded by the assessee before him in this regard and did not take into account the fact brought on the record by the Assessing officer. 4. Ld. D/R vehemently argued supporting the finding of ld. AO. 5. Per contra, ld. Counsel for the assessee heavily relied on the finding of ld. CIT(A) and also referred to the facts of the case as well as the details filed in the paper book containing 117 page ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt has actually received the said amount of Rs. 11,52,934/-. (iv) The AR has furnished detailed written submission along with requisite documentary evidence which satisfactorily explains the contention of the appellant. In view of the above, it is held that the AO is not justified in making the addition of Rs. 11,52,934/- as undisclosed turnover of the appellant. Therefore, the said addition of Rs. 11,52,934/- is hereby deleted. Accordingly, this ground of appeal is allowed. 8. From perusal of the above finding of ld. CIT(A) as well as the submissions made by the assessee before the lower authorities which remained uncontroverted at the end of ld. D/R, we are of the considered view that the alleged addition was wrongly made by ld. AO on the basis of some arithmetical mistakes made while examining the turnover details of the assessee and ld. AO failed to establish that the appellant has actually received the said sum of Rs. 11,52,934/- over and above the turnover disclosed in the books of account. Thus, no interference is called for in the finding of ld. CIT(A) and ground no. 1 raised by the Revenue is dismissed. 9. Revenue s Ground no. 2 relates to the addition of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n along with requisite documentary evidence which satisfactorily explains the contention of the appellant. In view of the above, it is held that the AO is not justified in invoking the provisions of Section 41(1) of the Income-tax Act, 1961 and making the addition of Rs. 94,71,000/- on account of cessation of liability u/s 41(1) of the Income-tax Act, 1961. Therefore, the said addition of Rs. 94,71,000/- is hereby deleted. Accordingly, this ground of appeal is allowed. 10. From perusing the finding of ld. CIT(A) and also considering the facts of the case, we find that the assessee is a partner in M/s. Baba Baidyanath Constructions and the alleged sum is undisputedly received by the assessee in the preceding year. The assessee being the partner in the firm can withdraw the sum from the partnership firm if needed. Such amount withdrawn from the partnership firm of which genuineness is not in doubt can be utilized by the assessee for any of its purpose including the one for business. The assessee has never claimed the alleged amount as any deduction or allowance against the revenue during the year or in the past. The assessee still remains the partner in the partnership firm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roneously invoked for the addition of Rs. 46,86,305/- due to the following: (a) The identity of M/s Baba Baidyanath Construction is established with the Partnership Deed, PAN ITR. Moreover, the appellant is also partner in the firm. (b) The genuineness of the transactions are established as the transactions were made through account payee cheque and there were no cash deposits and the receipts were only from the Government Department. (c) The creditworthiness of the transaction is also established by way of Form 16A issued by Government Department, Bank Statement, etc. The ultimate source of fund is from Government of Jharkhand. (d) The AO has stated that the appellant has not established the purpose of the transaction which is not required to be established as per the legal provisions. In view of the above, the appellant has clearly discharged the onus cast upon him under the law to establish the identity, genuineness and creditworthiness of the transaction with the necessary documentary evidences. (ii) The AR has also brought out the legal provisions of section 68 of the Income-tax Act, 1961, decision of the Hon ble SC on interpretation of statutes ..... X X X X Extracts X X X X X X X X Extracts X X X X
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