2002 (8) TMI 798

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.... the capacity of the depositor and wrongly relied on the decision of Hon'ble Allahabad High Court in the case of CIT v. Jaiswal Motors Finance [1983] 141 ITR 706 . 2.1 The facts of the issue are that the Assessing Officer found that deposits made of Rs. 15,000, 12,500 and Rs. 80,000 made in the individual savings a/c of the partners of the firm Shri Gopal Khera, Shri Vikas Khera and Shri Ashok Kumar Saravagi respectively and thereafter introduced the capital by issue of cheque in the accounts of the firm, remained unexplained. Hence, the addition of Rs. 1,07,500 in aggregate was made by the Assessing Officer under section 68 of the I.T. Act. Thus, the CIT(A) relying on the decision of Jaiswal Motors Finance's case (supra) and considering....

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....ll as genuineness of the transaction. Merely filing of confirmation letter is not sufficient. The ld. DR also relied on the decision of Hon'ble Calcutta High Court in the case of Oriental Wire Industries (P.) Ltd. v. CIT [1981] 131 ITR 688 where the Hon'ble High Court has held that loan shown in the books of the assessee, therefore, burden is on the assessee to prove the genuineness of the transaction. The reliance was also placed on the decision of Hon'ble Rajasthan High Court in the case of CIT v. Kishori Lal Santoshi Lal [ ] 216 ITR 9 where in the cash credit in the accounts of a firm (i) there is no distinction between the cash credit entry existing in the books of the firm whether it is of a partner or of a third party, (ii) the burden....

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....Rs. 15,000 and Shri Vikas Khera on the same day of Rs. 12,500 in their individual savings bank a/c, has nothing to do with the assessee-firm as on that day, the firm was not in existence, which came in existence subsequently on 1-11-1990. Simi- larly, in the case of Shri Ashok Kumar Saravagi, the third partner, the deposit in his savings bank a/c was made on 9-11-1990 just after 8 days of the firm came into existence. Therefore, deposits made by all the three partners are prior to existence of the firm or just after 8 days after existing the firm, cannot be treated as suppressed income of the assessee-firm. The ld. Counsel to the assessee also argued that part of the capital introduced by partner during the year under consideration, has als....

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....ongly been relied upon by the CIT(A). The ld.Counsel argument that cash deposit made by the partners Shri Gopal Khera of Rs. 15,000 and Shri Vikas Khera of Rs. 12,500 on 29-10-1990 in their individual savings bank a/c, has no concern with the assessee-firm as it came into existence later on 1-11-1990, has no force. Similarly, the deposits of Rs. 80,000 made by the third partner Shri Ashok Kumar Saravagi in his savings bank a/c on 9-11-1990 i.e. just after 8 days of the existence of the firm can also not be relied upon. Though, the amount was deposited by all the three partners by a/c payee cheque in the accounts of the assessee-firm, but it is not sufficient that the assessee-firm has discharged its onus. It has been held by Hon'ble Rajasth....