Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2009 (9) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2009 (9) TMI 15 - HC - Income TaxInterest Paid to Partners – section 40(b)(v) – remuneration clause in the partnership deed is in line with section 40(b) - It is contended on behalf of the revenue that in respect of the profits upto Rs.75,000/-, even in the partnership deed, the word “upto Rs.50,000/- or 90% of the book profits” have been used which shows that the partnership deed does not exactly determine the remuneration of the partners – Held that - the manner of fixing the remuneration of the partners has been specified. In a given year, the partners may decide to invest certain amounts of the profits into other venture and receive less remuneration than that which is permissible under the partnership deed, but there is nothing which debars them from claiming the maximum amount of remuneration payable in terms of the partnership deed. The method of remuneration having been laid down, the assessee firm is entitled to deduct the remuneration paid to the partners under Section 40(b)(v) of the Income Tax Act
|