2002 (4) TMI 885

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.... of the building held by the firm was Rs. 1,90,221 as on 1-4-1991. The value of the property was appreciated by Rs. 10 lakhs by mutual agreement of the partners. Consequently, the capital account of the five partners was enhanced by crediting Rs. 2 lakhs in the account of each partner and interest @ 18% was charged in respect of the enhanced value which was credited to the partner's capital account. The Assessing Officer disallowed the amount of interest claimed by the assessee in all the years. 3. By the impugned order, the first appellate authority allowed relief to the assessee. 4. The learned D.R. supported the assessment orders. On the other hand, the learned Counsel on behalf of the assessee placed reliance on the impugned findi....

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....on of the Tribunal in the case of Asstt. CIT v. Mehta Soap Factory [1999] 65 TTJ (Pune) 770 decision of the M.P. High Court in Rajdoot Hotel Enterprise Corpn. v. CIT [1987] 167 ITR 167 and of the Delhi High Court in 154 ITR 510 (sic). 5. After hearing both the sides, we find that capital account of the partners was enhanced by Rs. 2 lakhs by virtue of the appreciation of the value of the building. We have noticed the written down value of the building as well as the rent received in each year. It is a matter of record that the rent was being increased in every year and appreciated rent was being received more than the written down value of the building. In such circumstances, the partners, in our opinion, have rightly appreciated the val....

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....e parts from Central Calcutta Diesels and Subhas Automobiles of Rs. 98,700 and Rs. 64,500. The Assessing Officer issued summons under section 131 for personal attendance from those parties. However, the summons could not be served as the parties were not traceable. The Inspector was deputed and according to his report, no such parties were available in the address given in the bills. The Darwan working at the premises at 138, B.R.B.B. Road, Calcutta for the last 35 years stated that no firm was in existence as M/s. Central Calcutta Diesel. This enquiry report was served on the assessee by Letter dated 4-1-1999 by the Assessing Officer. However, since the genuineness of the purchases could not be proved, the addition was made as bogus purcha....