1978 (8) TMI 54

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ndividual. He became a partner of the firm, Messrs. Saraswati Udyog, which was constituted in Diwali, 1968. His share in the firm was 27%. On November 7, 1968, he gave 11 engines and some other spare parts to the firm of the total value of Rs. 40,000. This was his capital contribution to the firm. He also gave a cash deposit of Rs. 6,000 to the firm on June 4, 1969. The ITO, while computing the in....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....d. At the instance of the assessee, the Tribunal has referred the following question of law for our opinion : " Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that section 68 of the Income-tax Act and not section 69 was applicable and on that basis in upholding the addition in assessment year 1970-71 ? " Section 68 reads : " 68. Where ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....n who is liable as an assessee on the one hand and a firm on the other being as much an entity liable to assessment independently of the individuals who may constitute its partners. When s. 68 uses the term " books of an assessee ", it refers to the assessee whose books show the cash credit entry. In the case of the firm, the books maintained by the firm should show a cash credit entry and the fir....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of the investments or the explanation offered by him is not, in the opinion of the Income-tax Officer, satisfactory, the value of the investments may be deemed to be the income of the assessee of such financial year. " In the present case, the assessee had made invest....