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2014 (7) TMI 505 - AT - Income TaxValidity of reassessment u/s 147/148 of the Act – Held that:- The decision in ACIT, Circle 37(1), New Delhi Versus Sood Brij & Associates [2014 (7) TMI 496 - ITAT DELHI] followed - the reasons were recorded on 30th March, 2010 and on the same date notice u/s 148 was issued - The reason were supplied to the assessee - the re-assessment proceedings cannot be held to be bad in law - the notice was served on the assessee - the reasons recorded by the respondent were supplied to the assessee - the contention of the assessee is assessee cannot be accepted that reassessment was bad in absence of reasons to reopen being supplied to it after limitation period prescribed by the Act – Decided against Assessee. Partner’s remuneration u/s 40(b) of the Act – Held that:- The decision in ACIT, Circle 37(1), New Delhi Versus Sood Brij & Associates [2014 (7) TMI 496 - ITAT DELHI] followed - clause (iii) and other clauses in Section 40 (b) specifically use the expression "in accordance with the terms of the partnership deed" - the quantum of remuneration or the manner of computing the quantum of remuneration should be stipulated in the partnership deed - The expression "in accordance with the terms of the partner deed" read with clause (iii) of section 40 (b), requires and mandates that the quantum of remuneration or the manner of computation of quantum of remuneration should be stated in the partnership deed and should not be left undermined, undecided or to be determined or decided on a future date - the remuneration is not specified - The manner of computing the remuneration is not specified - the remuneration payable is left to future mutual agreement between the partners who are entitled to decide and quantify the quantum - Remuneration can be any amount or figure but not more than the maximum amount stated in Section 40 (b) (v) of the Act – thus, the order of the CIT(A) is upheld – Decided against Assessee. Non-consideration of the payment of advance tax paid by the partners on the Partners’ Remuneration – Computation of interest u/s 234B r.w. section 155 (IA) of the Act – Held that:- CIT(A) has not adjudicated the issue saying that charging of interest u/s 234 of the Act is consequential - as per the provision of section 155(IA) of the Act wherein respect of any completed assessment of a firm, it is found that any remuneration of any partners is not deductible under clause (b) of section 40 of the Act - the AO may amend the order of assessment of the partner with a view to adjusting the income of the partner to the extend of the amount not deductible - the AO has not done this exercise in respect to the partner’s income inconsequence to the disallowance of remuneration in the hands of the assessee firm and as stated earlier the CIT(A) has not dealt - thus, the matter is remitted back to the AO for fresh adjudication – Decided in favour of Assessee.
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