COMMISSIONER OF INCOME TAX Vs. ODEDARA CONSTRUCTION

JUDGEMENT

(1.) The Revenue is in appeal against the judgment of the Income-tax Appellate Tribunal (hereinafter referred to as "the Tribunal") dated August 31, 2012, raising the following substantial questions of law:

(2.) The Revenue carried the issue further in appeal before the Tribunal. The Tribunal also relied on the decision in the case of Pankaj Dyestuff and also on the decision of the Allahabad High Court in the case of CIT v. Jaiswal Motor Finance, 1983 141 ITR 706 (All) making the following observations:

(3.) Having heard the learned counsel, Mr. Pranav Desai, for the Revenue and having perused the orders, we see no reason to interfere. In view of the findings of the Commissioner of Income-tax (Appeals) and the Tribunal, it clearly emerges that the capital was introduced by the partners. The Assessing Officer did not bring any material to indicate that the partners had no capacity to introduce such capital. In other words, the Assessing Officer did not hold that the capital was, in fact, not introduced by the partners but it was only in disguise the cash credit of the firm. Significantly, the partners were also subjected to tax assessment. Their assessment orders were placed on record, which showed that in the return of income, they declared the income from agricultural operations. They have produced extracts of 7/12 and 8A of the lands in support of their claims. In that view of the matter, the Tribunal was perfectly justified in applying the ratio of the decision of this court in the case of Pankaj Dyestuff , in which it was held and observed as under: