9911796707
TMI Blog1980 (5) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... vested this sum in his personal account maintained with the assessee firm. His claim is that this sum of Rs. 1,400 invested in the year 1942 with the annual accretion of interest has now grown into a sizable amount. Having realised that this amount originally arisen from the necleus of Rs. 1,400 received from partition effected in the year 1942 did not belong to him in his individual capacity, but belonged to the Joint Hindu Family of which he was Karta. He thought of separating the sum from his personal account. Therefore, in April, 1976 by debiting his account and crediting the account of Dewan Chand HUF in the assessee firm's books, he caused a transfer of a sum of Rs. 64,231.68. The firm, when it closed its account at the end of the yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... books of the assessee firm. To a query by the CIT (A) as to why the same was not consumed in the long role of years, the assessee explained that he had other income and, therefore, the amount of the HUF remained in tact. The CIT (A), however, was not carried away by his reasoning and reached a finding contained in the following para: As observed above, not an iota of evidence has been produced to show that the money received on partition by Shri Dewan Chand was not spent away but was actually invested in the assessee firm. Another fact that is to be noted is that M/s Sudershan Weaving Factory were not paying any interest to its partners on capital/money invested by them in the firm and, therefore, there is no question of the money inves ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oint Hindu family being a separate entity should not be mixed up with the partner. Therefore, the interest earned on a sum belonging to the joint Hindu family cannot be treated as interest payment to a partner. The departmental representative, relying on the orders of the lower authorities, reiterated that apart from the family partition deed, the assessee did not produce any evidence, whatsoever. He stated that it is not worth believing that the assessee has kept in tact a sum of Rs. 1,400 which was received by him in the year 1942 about 40 years before and was not consumed away in the meanwhile. He has not proved of having deposited the amount of Rs. 1,400 in the books of the assessee firm. According to him, the books of the firm for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar totalled to Rs. 14,434. In disallowing 50 per cent of the expenses, the ITO has brought no reason on the record apart from the consideration of personal user. Taking into account the increase in the expenditure under this head for the last three years, we are of the view that a disallowance of half is somewhat excessive and should be limited to 1/4th of the total expenditure on account of the personal user by the partners. Accordingly, we reduce the expenditure on this score to 1/4th. In accordance with this decision, we would limit the disallowance of depreciation also on car to 1/4th. 4. This brings us to the consideration of appeal, filed by the Revenue. The Revenue has raised only two issues regarding the allowance of building rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the Deptl. Rep. also disputed the soundness of his inference that the cost incurred for reconstructing a roof in concrete and cement was not a capital expenditure. Similar were his contentions regarding the electric fittings. The counsel for the assessee, on the other hand, rebutted the contentions of the Revenue that any new evidence was called for. According to his submission, whatever material was presented before the ITO was also produced before the CIT (A) while the ITO did not care to look into the material produced before him and draw the correct inference, the CIT (A) showed patience and looked into the material. He submitted that the premises which the assessee was occupying was only as a tenant where he would be liable to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the year. Having heard both the parties, we are of the view that the submissions of the assessee are more well founded in reason and fact. The replacement of roof can, by no means, be said to bring a new advantage of enduring value to an assessee who is a tenant and occupying the premises for carrying on the business. A new roof is like an old roof which gives protection against sun wind and rain. What new advantage could the assessee secure by reconstructing the roof which had caved in. Similar, is our finding for the cost of wiring and electric fittings, amounting to Rs. 8,808. We, therefore, sustain the order of the CIT (A) and dismiss the appeal of the Revenue. 5. In the result, the appeal of the assessee is partly allowed while th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
