TaxTMI 
TaxTMI 
2014 (11) TMI 548
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....ent the case is out of station. Since these are old appeals and several opportunities have already been granted, this application for adjournment was rejected and the appeals were heard after hearing Learned D.R. of the Revenue and the assessee was given an option to file written submissions within one week of hearing. The Learned A.R. of the assessee has filed written submissions on 15/09/2014 and hence, we decide these appeals after considering this written submissions of the learned AR of the assessee. 3. Learned D.R. of the Revenue supported the orders of the authorities below. 4. First we take up the certain legal propositions as reproduced below raised by the learned AR of the assessee in his written submissions for each of the years. These legal propositions are reproduced below: "LEGAL PROPOSITIONS: 1. Addition of unexplained deposit of credit in bank account where books of account are not maintained.- not sustainable. The assessee-appellant is not maintaining any books of account which fact is on record. The addition has been made in respect of deposits made in the bank accounts both in his "individual" bank accounts as well as in the bank accounts of the....
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.... page no. 22 (12l line from bottom) wherein the nature of business has been mentioned as "service job of advocacy" Thus, there cannot be any doubt that the appellant Vishal Dixit is a separate legal entity before the Department while M/s Dixit & Company is a separate legal entity hi the eyes of law as the same complies all the requirements as required by the partnership Act, 1932 and, therefore, two separate entities cannot be equated for one entity and there is no justification in treating the deposits in the bank accounts of M/s. Dixit & Company as deposits of the appellant and adding the same as undisclosed deposits in the hands of the appellant. It is a well settled law that if cash credits are found in the books of the firm they could not be added in the hands of the assessee. as income from undisclosed sources. For the above proposition, the assessee-appellant would like to rely on the following cases:- Anand Ram Raitani Vs. CIT 223 ITR 544 (Gau.) The Hon'ble Gauhati High Court has held that a partnership firm is an assessable entity distinguished from individual partner. The books of account of partnership cannot be treated as those of individual partner. Refere....
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....t the same as undisclosed income of the assessee Vishal Dixit. Proposition 3 Peak Credit/Telescoping of deposits/withdrawal. Without prejudice to pleadings with reference to the fact that no addition under section 68 can be made in the hands of the assessee only based on credit entries found in the bank pass book and further proposition that in any view of the matter credit entries appearing in the firm M/s. Vishal Dixit & Company which is a separate entity could not be added as undisclosed income in the hands of the assessee. The assessee would like to canvass theory of peak credits or telescoping. The Department has not given any benefit to the assessee of peak credit theory or telescoping the additions and withdrawals from bank account of Vishal Dixit and/ or from the bank account of M/s Vishal Dixit & Company consolidated. We have worked out a peak credit based on: Deposits in the bank account of Vishal Dixit peak credit of withdrawals from bank account paper book page 33 & 34 to show availability of cash. Once the source of income has been treated as undisclosed income of the assessee-appellant, the assessee should have been allowed the benefit of telescopy of avai....
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....econd legal proposition as per Learned A.R. of the assessee is that for credits in bank pass book of M/s Dixit & Co., no addition can be made in the hands of assessee because M/s Dixit & Co. is a partnership firm being separate entity. In this regard, we find that the present appeal is in second inning and earlier the issue was decided by the Tribunal in I.T.A. No.496 and 623/Luc/02 dated 28/09/2007 and as per this Tribunal order, the matter was restored back to the file of the Assessing Officer for fresh decision in the light of the Tribunal decision for assessment year 1996-98 in I.T.A. No.363/Luc/03 of March, 2005. The relevant portion of this Tribunal order for assessment year 1997-98 was reproduced by the Tribunal in its order for assessment year 1996-97. In assessment year 97- 98, in the Tribunal order, it was stated that Learned A.R. of the assessee has given undertaking before the Tribunal that the assessee will be extending full cooperation to the Assessing Officer in second inning. In Para 6 of the Tribunal order for the assessment year 96-97 also, it is noted by the Tribunal that the assessee is required to extend full cooperation to the Department in getting the assessm....
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....ntion any reference of the deed of partnership dated 18/09/1993. Thereafter, the Assessing Officer has given a finding that it is apparent that there are contradiction between the contents of the partnership deed and the replies filed by the assessee on different dates. The impugned order of CIT(A) is also on the basis that there is no credible evidence to support the contention that the transactions were actually conducted by the said firm. He has also noted that the documents enclosed in support of the transactions of the firm have to be considered only as evidence created, after the decision by Tribunal, to give validity to the alleged transactions conducted by the concern. 7. From the above, it is seen that the main objection is of the A.O. that there is some inconsistencies in objects of the firm as per deed and replies. Second objection is of learned CIT (A) that there is no credible evidence to support the contention that the transactions were actually conducted by the said firm. Regarding these objections, we are of the considered opinion that merely on the basis of these objections, it cannot be concluded that the firm is not in existence. As per section 184 of I.T. Act....