TaxTMI 
TaxTMI 
2014 (2) TMI 1214
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....Punjab Trading Co. Yamuna Nagar as Income of M/s Punjab Plywood Industries." 3. After hearing both the parties we find that a search was conducted in this group. During search, the statement of the assessee i.e. Smt. Meena Garg was recorded and the relevant extracts which has been reproduced in the assessment order which reads as under:- "Q. Please state whether you are assessed to Income Tax or not. Ans. I am not aware of any fact in this regard. It is my husband only who knows, whether I pay income tax or not. I am a housewife only and I depend upon my husband to tap the source for running household activities. Q. Perusal of your return of Income reveals that you are the proprietor of M/s. Punjab Timber Tradi....
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....? Ans. No, before getting married I was teaching. Q18. Do you sign any cheques etc. Ans. Yes, the cheques that are presented by my husband. Q23. On the date of search at your residence in March 2007 during the course of search was your statement recorded. Ans. Yes." 5. From the above, the Assessing Officer concluded that the assessee had denied doing any business during the search. Even in the statement recorded during the assessment proceedings she further submitted that she had no knowledge where the books of account were kept. On these facts, the Assessing Officer concluded that the proprietary concern the Punjab Timber Trading Co was in fact being run and owned by Punjab Plywood Industries....
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.... action of the Assessing Officer. 7. Before us, the Ld. Counsel for the assessee reiterated the submissions made before the lower authorities and particularly pointed out that there is no provision under the Act by which income of an individual can be clubbed in the income of a firm where assessee's husband is a partner. He further submitted that decision of the Hon'ble Madras High Court in the case of E.A.E.T. Sundararaj 95 ITR 454 (Mad.) (supra) is distinguishable on facts because it was clearly held that it would depend upon the facts whether the particular firm is 'benami' or not. In that case, according to him business was carried on in the same premises and some capital had also gone from the existing firm to the new firm. 8....
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....rm. It is also not brought on record that business was conducted from the same premises. It is only on the statement recorded during the search where Smt. Meena Garg i.e the assessee has said that she was not running any business concern in the name of M/s Punjab Timber Trading Co but later on in respect of question No. 24, during the assessment proceedings she clearly stated that she was confused and nervous. Question No. 24 and its answer reads as under;- "Q24. In the statement recorded on the date of search you have specified that you are not filing any return of income or have any business concern. Please clarify as to why you had stated so when today you are doing timber business. Ans. I denied doing any business as I....