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TMI Blog2013 (4) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... for the year 2006-07 added a sum of Rs.12.07 lakhs on account of unaccounted capital introduced by the partners of the firm. The Assessing Officer treated the said sum as unexplained cash credit under Section 68 of the Income Tax Act, 1961. 3. The assessee approached the Appellate Commissioner. The Commissioner was of the opinion that such additions could not have been made in the hands of the firm and the Department could have made such additions in case of respective partners of the firm. Revenue carried the matter in appeal before the Tribunal. The Tribunal by the impugned order dated 30.6.2010 dismissed the Revenue's appeal. The Tribunal, basing reliance on the decision of Division Bench of this Court in the case of Commissioner of I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he firm cannot constitute the books of account of the partners for the purpose of section 68 of the IT Act, 1961. It was held that since no such books of account having maintained by the partners, therefore addition u/s 68 of the IT Act 1961 could not be made. Likewise, rest of the decisions; namely Basantipur Tea Company Pvt. Ltd. reported as 180 ITR 261 (Cal.) and the decision of Ashok Timber Industries reported as 125 ITR 336 (Cal.), both are also not on the issue in hand because details in respect of the cash credit found on the very first day of the accounting year. In all, therefore, the decision as cited by the side of the Revenue can be said to be misplaced and do not cover exactly the issue in hand. On the other hand, the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. It is not the case of the revenue that the partners of the assessee firm are fictitious. The Income Tax Officer has not disputed that the credits in the accounts of the partners were not deposits from the partners. Moreover, it is an admitted position that this was the second year of the firm, and that it was running in loss. It is true that the Income Tax Officer did not accept the explanation given on behalf of the assessee in respect of the new deposits or cash credits in the accounts of the partners. The mere non-acceptance of that explanation does not, however, provide material for finding that the said sum represented income of the assessee firm. As held by the Allahabad High Court in case of Commissioner of Income Tax, All ..... X X X X Extracts X X X X X X X X Extracts X X X X
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