Cash Credit Appearing In Name of Partners in Books of Firm – Addition to be made in the Hands of Firm.
- The mere failure of the partners to explain properly the source form where they got the money, will not justify addition of cash credits in the name of firm
- Where there is no satisfactory explanation regarding the credits, appearing in the capital accounts of partners, or the explanation offered is not supported by adequate evidence such credits may the charged under section 68 as the income of the firm.
- Books of account of the firm cannot be said to be the books maintained by partners.
Source: The Tax Publisher, The Tax Referencer 16-1-2012
