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2013 (9) TMI 118 - AT - Income TaxDisallowance of partners’ salary from undisclosed income - AO disallowed an amount of Rs.23,98,795/- by holding that the amount of Rs.65,00,000/- disclosed during the course of the survey to be treated separately as ‘deemed income’ and the allowable salary to be worked out on the balance profit in accordance with the partnership deed and provisions of 40(b) of the Act – Held that:- once the amount has been assessed as business income, remuneration admissible to partners in terms of the partnership deed has to be allowed in accordance with and within the limits stipulated under the provisions of sec. 40(b) of the Act. In the present case, relying upon the above decision it was decided to grant the deduction in respect of salary worked out as per the provisions of Section 40(b) of the Act and in accordance with the partnership deed from the undisclosed income disclosed during the course of survey considering the same as business income – Decided against the Revenue.
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