TMI Blog2018 (1) TMI 1732X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Officer. We therefore see no reason to accept Revenue s instant sole substantive grievance. - SHRI S. S. GODARA, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER For the Revenue : Shri V. K. Singh, Sr. D.R. For the Assessee : None ORDER PER S. S. GODARA, JUDICIAL MEMBER This Revenue s appeal for assessment year 2011-12 arises against the CIT(A)-1, Vadodara s order dated 30.12.2015, in case no. CAB-1/155/2015-16, reversing Assessing Officer s action making Section 68 addition of Rs.1,26,11,000/- as unexplained cash credits in respect of capital introduction by assessee s partner Shri Ashwin Patel, in proceedings u/s. 143(3) of the Income Tax Act, 1961; in short the Act . Case called ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted before the AO that the entries in these account extract would explain the partners' capital introduction. The AO has observed that: perusal of these account extracts indicates the transfer entries in the bank account summary submitted and also cash deposits. Accordingly, the AO asked the appellant's AR to explain the amounts received in the bank account of Shri Ashwin Patel and submit supporting evidences in respect of the above deposits like loan confirmations in respect of amounts taken by cheque and details regarding cash deposits. In response to this, the AR could not offer any satisfactory and cogent explanation. Hence, the AO provided a final opportunity to produce all the relevant records along with books of account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the appellate proceedings, the appellant has again not made any compliance to the notice of Hearings. In the statement of facts also no specific argument has placed regarding this addition. In the grounds of appeal also the appellant has clearly stated that it had only produced the partner's capital account along with loan statement from HUDCO and copy of ledger account of HUDCO Loan before the AO during the course of the assessment proceedings. Thus, neither the confirmations from this partner nor the details of income-tax returns of this partner or the original bank statement of this partner had been produced before the AO in order to prove the capacity of the partner to introduce this capital account in the books and to prove the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciples to the facts of the present case, apparent that the assessee had furnished the details, which would discharge the onus which lay on the assessee. It is not the case of the revenue that the partners of the assessee firm are fictitious. The Income Tax Officer has not disputed that the credits in the accounts of the partners were not deposits from the partners. Moreover, it is an admitted position that this was the second year of the firm, and that it was running in loss. It is true that the Income Tax Office did not accept the explanation given on behalf of the assessee in respect of the new deposits or cash credits in the accounts of the partners. The mere non-acceptance of that explanation does not, however, provide material for find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal High Court as reproduced above, such capital introduction cannot be taxed in the hands of the appellant. But at the same time it is seen that despite being given several opportunities of being heard, the sources of deposits made in the partners bank account has not been explained by the appellant despite the fact that this partner was also present before the AO during the course of the assessment proceedings. Hence as held by the Hon'ble Allahabad High Court in its decision in the case of Jaiswal Motor Finance (supra), no addition of such capital can be made in the hands of the assessee, but if the AO is not satisfied with the explanation offered by the partners, he may proceed against the partners and assess the same in their hands ..... X X X X Extracts X X X X X X X X Extracts X X X X
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