TaxTMI 
TaxTMI 
2024 (9) TMI 474
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....ax Act, 1961 (hereinafter referred to as 'the Act') relating to the Assessment Year 2016-17. 2. The solitary ground raised by the Revenue is whether the Ld. CIT(A) was justified in deleting the addition of Rs. 2,62,50,000/- as against cash credit in the books of the assessee firm u/s. 68 r.w.s. 115BBE of the Act without taking into consideration facts of the case. 3. The brief facts of the case is that the assessee is a Limited Liability Partnership Firm filed its Return of Income for the Asst. Year 2016-17 on 29.07.2016 showing Nil total income. The case was selected for scrutiny assessment and the A.O. made addition of Rs. 2,62,50,000/-, being the capital introduced by the Partners. Since the assessee failed to prove the genuineness and....
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....e fact of the present case, when the assessee has furnished the details with regard to the sources of the capital introduced in the firm and the concemed partner had confirmed such contribution, the assessed had duly discharged the onus cast upon it, Thereafter, if the Assessing Officer was not convinced about the creditworthiness of the partner who had made capital contribution, the enquiry had to be made at the end of the partner and nol against the firm. The controversy involved in the present case, therefore, stands squarely covered by the decision of this court in the case of CIT vs Pankaj Dyestuff Industries in Income Tax Reference No.241 of 1993" 7.4 The above view was also subsequently affirmed by the Hon'ble Supreme Court in ....
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....g upon the decisions of the Hon'ble High Court and Tribunals cited above, I am of the view that no addition can be made in the hands of the firm in case capital introduction by the partners. Accordingly, the AO is directed to delete the addition of Rs. 2,62,50,000/- made under section 68 of the Act. However, in the case of partners the AO is free to take appropriate action according to the law. The ground thus, allowed." 5. Ld. Counsel Shri D.K. Parikh appearing for the assessee submitted before us a Paper Book wherein submissions made before the Lower Authorities as well as a compilation of Case Laws and submitted that it is well settled as far as credit in the capital account of the Partners in the case of firm is concerned. No addit....