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2018 (10) TMI 1686 - AT - Income TaxDeduction u/s 10AA - applicability of provision of Section 80(IA) r.w.s. 10AA(9) - impact of not claiming deductions of interest on Capital and Remuneration to partners of the assessee firm - HELD THAT:- From the binding decision of the Hon'ble High court of Gujarat in the case of Alidhara Taxspin Engineers [2017 (5) TMI 1684 - GUJARAT HIGH COURT] wherein their lordship speaking for the Jurisdictional High Court clearly held that mere incorporation of interest on partners capital account and remuneration does not signify that the same are mandatory in nature. As we have noted above, in the present case the appellant has not charged any interest and remuneration as per partnership deed therefore, the appellant firm cannot be compelled to charge interest or remuneration. Therefore, we are inclined to hold the CIT(A) was right in observing that the disallowance made by the AO on account of non provision of interest and remuneration of s. 10AA deduction is erroneous and incorrect and law and facts as in the peculiar facts of the present case the partnership deed clearly lays down that no interest and remuneration is payable and hence, the first appellate authority right in deleting the disallowance made by the AO on account of non provision of interest and remuneration from amount of deduction u/s. 10AA. We are unable to see any valid reason to interfere with the same and thus, we confirm the same. Decided against revenue.
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