TMI Blog2019 (2) TMI 2095X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer with a direction to decide the issue afresh in the light of various decisions cited above. Needless to say, the Assessing Officer shall give due opportunity of being heard to the assessee and decide the issue as per fact and law. We hold and direct accordingly. The first issue raised by the assessee in the grounds of appeal is accordingly allowed for statistical purposes. Addition u/s 68 - partner introduced the money in the firm - assessee has not furnished any cash flow statement to establish the withdrawal and the deposit of cash during the course of appeal proceedings - Addition n the hands of the partnership firm stating that there is no exigency for introduction of such loan in the shape of cash - HELD THAT:- Although the assessee has not explained such business exigency, however, it is a fact that there are withdrawals from the bank account of the partner apart from his declaration of income u/s 44AD of the IT Act. The Revenue has not proved that the Partner after withdrawal of the money from the bank has utilized the money otherwise than for investing in the partnership firm. There is nothing on record to show that the partner has utilized the money for acquisit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at higher rate of 30% has been claimed and observed that the assessee is not doing business of motor buses, motor lorries, motor taxies used in a business of running them on hire. He, therefore, was of the opinion that in view of the provisions of section 32(2) of the IT Act, the assessee is entitled to depreciation @ 15% which is applicable to plant machinery. He, therefore, confronted the same to the assessee. The assessee replied that most of the plant machinery are Dumper, Hyva, Excavator, JCB and commercial vehicles and has worked for triple shifts. Relying on various decisions, it was argued that the assessee is entitled to depreciation @30%. 4. However, the Assessing Officer was not satisfied with the explanation given by the assessee. He observed that certain vehicles are light commercial vehicles, namely, Bolero, car, jeep, Maruti Swift Dezire, Safari and Scorpio, etc., which are not used for carrying any material. They are used for the personal transportation of the staff and partners of the firm. By changing the name and nomenclature of these vehicles the assessee cannot claim higher depreciation. He, therefore, allowed depreciation on these vehicles at 15% as aga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eard to the assessee and decide the issue as per fact and law. We hold and direct accordingly. The first issue raised by the assessee in the grounds of appeal is accordingly allowed for statistical purposes. 8. The second issue raised by the assessee in the grounds of appeal is regarding the addition of Rs.41 lakhs made by the Assessing Officer u/s 68 of the IT Act which has been upheld by the CIT(A). 9. The facts of the case, in brief, are that the Assessing Officer, during the course of assessment proceedings observed that the assessee has raised unsecured loans amounting to Rs.58,20,000/- from the following persons/concerns:- (i) M/s Astha Minerals, Prop. Shri P.K. Wadhwa (ii) Shri A.K. Garg (iii) Smt. Krishna Wati (iv) Shri P.K. Wadhwa (v) M/s Ram Babu Delhi Stone Suppliers, Prop. Shri P.K. Wadhwa (vi) Shri V.K. Pathak 10. From the various details furnished by the assessee, the Assessing Officer noted that the unsecured loans in the case of Shri A.K. Garg and Smt. Krishna Wati are old loans. He, therefore, accepted the same as genuine. However, he observed that the assessee has received an amount of Rs.19,50,000/- from M/s Astha Mine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e u/s 44AD in the ITR of P.K Wadhwa 16,00,000.00 b) From M/s Ram Babu Stone Works Vishwakarma colony, M.B. Road, New Delhi (Prop. Praveen Kr. Wadhwa) as appearing in the Audited Financial Statements for the F.Y 2010-11 9,50,000.00 c) Cash Withdrawn from Allahabad Bank Account No. 20478788485 16,50,000.00 Total Inflows 42,00,000.00 Less: Outflows a) To M/s Alliance Engineers Contractors i.As loan from Aastha Minerals ii.As Partner s Loan 16,00,000.00 25,00,000.00 b) Cash Deposit to Allahabad Bank Account No. 20478788485 2,00,000.00 c) Other transactions, Cheques deposit Cheques withdrawn in Allahabad Bank Account 1,49,571.00 Total Outflows 44,49,571.00 Closi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the money for acquisition of any capital asset or spent the money towards some marriage in the family or on other such occasions where huge cash is required to be invested or expended. It has been held in various decisions that when a partner introduces the money in the firm either in the shape of capital or loan to the partnership firm, addition, if any, can be made only in the hands of the partner and not in the hands of the partnership firm as long as the partner confirms to have invested towards capital or as loan to the firm. Since the partner in the instant case has admitted to have invested in the firm in the shape of unsecured loan and the withdrawals from the bank account has not been disputed by the Revenue, therefore, we are of the considered opinion that addition, if any, could have been made in the hands of the partner, namely, Shri P.K. Wadhwa but, certainly not in the hands of the partnership firm. As long as the partner has sufficient means to explain the source of such loan, the Revenue cannot treat the same as unexplained cash credit u/s 68 in the hands of the partnership firm merely stating that there is no exigency for introduction of such loan in the shape of c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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