Mohinder Pal Shyam Sunder, Yamunanagar V. ITO, Yamunanagar

ITA 806/CHANDI/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9092 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 20-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Keywords: Gift

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO. 806/CHD/2016 ASSESSMENT YEAR: 2008-09 M/S MOHINDER PAL SHYAM SUNDER, VS THE ITO, H.NO. 5, GALI NO. 13, WARD-2, AZAD NAGAR, YAMUNANAGAR. YAMUNANAGAR. PAN: AALFM5050D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI AJAY JAIN RESPONDENT BY : SHRI MANJIT SINGH DATE OF HEARING : 29.08.2016 DATE OF PRONOUNCEMENT : 14.09.2016 O R D E R THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS) KARNAL DATED 21.04.20 16 FOR ASSESSMENT YEAR 2008-09 CHALLENGING THE ADDITION OF RS. 3,46,000/- ON ACCOUNT OF ADDITION TO PARTNERS CAPI TAL. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SING OFFICER, DURING THE COURSE OF ASSESSMENT PROCEEDING S ON EXAMINATION OF THE BANK STATEMENT, DIRECTED THE ASS ESSEE TO EXPLAIN AN AMOUNT OF RS. 1,96,000/- DEPOSITED IN CASH BY SHRI SHYAM SUNDER, PARTNER AND FURTHER AN AMOUNT OF RS. 1,50,000/- WAS DEPOSITED BY SHRI MOHINDER PAL, 2 PARTNER IN CASH ON 13.06.2007. THE ASSESSEE SUBMIT TED THAT THESE PARTNERS DEPOSITED THEIR PERSONAL AMOUNT WHICH BELONGS TO THEIR FATHER AND MOTHER. THE ASSE SSING OFFICER DID NOT ACCEPT CONTENTION OF THE ASSESSEE A ND MADE ADDITION OF RS. 3,46,000/-. THE ASSESSEE SUBMITTED BEFORE LD. CIT(APPEALS) THAT ASSESSEE IS A PARTNERSHIP FIRM OF TWO REAL BROTHERS WHO ARE ENGAG ED IN CONTRACTORSHIP BUSINESS FOR FABRICATION SINCE LONG. BOTH THE ABOVE PARTNERS MADE DEPOSITS IN THEIR RESPECTIV E CAPITAL ACCOUNTS WHICH HAVE BEEN RECEIVED BY THEM F ROM THEIR FATHER AND MOTHER, THEREFORE, ADDITION IN THE HANDS OF THE ASSESSEE FIRM IS UNJUSTIFIED. 3. THE LD. CIT(APPEALS) NOTED THAT THERE IS NO DISP UTE REGARDING AMOUNT OF RS. 3,46,000/- DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE FIRM AND SAME HAD BEEN MADE BY SHRI SHYAM SUNDER AND SHRI MOHINDER PAL WHO WERE ALSO PARTNERS OF THE ASSESSEE FIRM. THE LD. CIT(APPEALS), HOWEVER, NOTED THAT THE AFFIDAVITS OF THE PARENTS OF THE PARTNERS ARE ONLY SELF SERVING AND A MOUNT DEPOSITED HAVE NOT BEEN SUPPORTED BY ANY EVIDENCE THEREFORE, ADDITION WAS CONFIRMED AND APPEAL OF THE ASSESSEE HAS BEEN DISMISSED. 4. ON CONSIDERATION OF THE RIVAL SUBMISSIONS, I AM OF THE VIEW ADDITION IS WHOLLY UNJUSTIFIED. THE LD. C OUNSEL FOR THE ASSESSEE RELIED UPON DECISION OF HON'BLE PU NJAB & HARYANA HIGH COURT IN THE CASE OF CIT V RAMESHWAR 3 DASS SURESH PAL CHEEKA 208 CTR 459 IN WHICH IT WAS HELD AS UNDER : ONCE A PARTNER OF THE FIRM HAS ACCEPTED HAVING ADV ANCED AMOUNT TO THE FIRM, NO ADDITION COULD BE MADE IN TH E HANDS OF FIRM UNDER S. 68. 5. HE HAS ALSO RELIED UPON DECISION OF HON'BLE PUNJ AB & HARYANA HIGH COURT IN THE CASE OF CIT V METAL & METALS OF INDIA 208 CTR 457 IN WHICH IT WAS HELD AS UNDER : PARTNER HAVING ADMITTED THAT HE HAS MADE THE IMPUG NED DEPOSIT WITH THE ASSESSEE FIRM OUT OF THE AMOUNT R ECEIVED AS GIFT, IT IS THE PARTNER AND NOT THE FIRM WHO IS LIABLE TO BE TAXED BY TREATING THE SAID AMOUNT AS UNDISCLOSED IN COME EVEN IF THE CLAIM OF GIFT SAID TO HAVE BEEN RECEIVE D BY HIM IS REJECTED. 6. THE LD. COUNSEL FOR THE ASSESSEE ALSO FILED COPY OF THE LEDGER ACCOUNT OF THE PARTNERS SHRI SHYAM SUNDE R AND SHRI MOHINDER PAL IN THE BOOKS OF ACCOUNT OF TH E ASSESSEE FIRM WHICH SHOWS THAT THE AMOUNT IN QUESTI ON HAVE BEEN CONTRIBUTED BY BOTH THE PARTNERS IN ASSES SEE'S FIRM WHICH HAVE BEEN TAKEN IN THEIR RESPECTIVE CAPI TAL ACCOUNTS. IN THE CASE OF SHRI MOHINDER PAL, RS. 1,50,000/- WAS EVEN DEPOSITED THROUGH BANKING CHANN EL. BOTH THE PARTNERS ARE ASSESSED TO TAX SEPARATELY. T HE LD. CIT(APPEALS) SPECIFICALLY NOTED IN HIS FINDINGS THA T PARTNERS HAVE MADE DEPOSIT IN THE ACCOUNTS OF THE ASSESSEE FIRM THEREFORE, WHEN THE PARTNERS OF THE ASSESSEE FIRM HAVE ACCEPTED HAVING MADE DEPOSIT IN THE 4 ASSESSEE'S FIRM IN THEIR CAPITAL ACCOUNT, NO ADDITI ON COULD BE MADE AGAINST THE ASSESSEE FIRM OF THE AFOR ESAID AMOUNT. SINCE BOTH THE PARTNERS ARE ASSESSED TO TA X SEPARATELY, THEREFORE, THESE AMOUNTS MAY BE CONSIDE RED IN THEIR INDIVIDUAL CASES. THE IMPUGNED ADDITION I N THE HANDS OF THE ASSESSEE FIRM IS, THEREFORE, WHOLLY UNJUSTIFIED. THE JUDGEMENTS RELIED UPON BY LD. COU NSEL FOR THE ASSESSEE ABOVE SQUARELY SUPPORT THE CASE OF THE ASSESSEE THAT ADDITION IS WHOLLY UNJUSTIFIED IN THE HANDS OF THE ASSESSEE FIRM. 7. IN VIEW OF THE ABOVE DISCUSSION, I SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND DELETE THE ADDITION OF RS. 3,46,000/- IN THE HANDS OF THE ASSESSEE FIRM. THE REVENUE IS AT LIBERTY TO TAKE UP THIS ISSUE IN THE INDIVIDUAL CASES OF THE PARTNERS IN ACCORDANCE WITH LAW, IF SO ADVISED. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED : 14 TH SEPT.,2016. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT/CHD