2014 (2) TMI 1214

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.... 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 Trading Co. Please state the details of the trading being carried out by thi....

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.... 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 in which male members of the family were partners. According to her, Smt. Meena Garg i.e. the assessee has only lent her name to this business and, therefore, income was he....

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....t 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. On the other hand Ld. DR strongly supported the order of Assessing Officer. 9. We have considered the rival submissions carefully and find that in the case of E.A.E.T. Sundarar....