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2016 (8) TMI 1140 - ITAT PUNEExcess stock found during the course of survey - deemed income under the provisions of section 69/69B - assessee submitted that the major expenditure claimed was on account of interest and salary to partners and accordingly the same represents appropriation of income and not a charge on income- Held that:- Tribunal held that the amount being difference in stock is represented by undeclared business income. It does not have a separate physical identity and has to be taxed under the head “business income” and the assessee is entitled to remuneration to partners u/s.40(b) of the I.T. Act from such income Thus the amount of ₹ 41 lakhs declared by the assessee during the course of survey partakes the character of business income and the assessee is entitled to remuneration and interest on capital as per the provisions of section 40(b) of the I.T. Act on such income. I hold and direct accordingly. The additional ground as well as the ground raised by the assessee are accordingly decided in favour of the assessee.
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