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2016 (2) TMI 192 - AT - Income TaxAllowance of partners remuneration u/s. 40b from the additional income offered for taxation during survey - CIT(A) deleted the addition - Held that:- CIT(A) while deleting the addition has noted that Assessee had only one source of income being construction activity and in the statement recorded during the course of survey, it was categorical mentioned that the income was from construction project, it was disclosed in the Profit and Loss account of the firm and was offered to tax and the quantum of income disclosed has been accepted by Revenue. We find that the Co-ordinate Bench of Tribunal in the case of Shri Labdhi Prints (2012 (5) TMI 635 - ITAT AHMEDABAD) after considering the various decisions cited before it and referred to in the order had agreed with the decision of ld. CIT(A) that once the additional income offered for taxation during the survey is accepted and it has been explained to be as business income as the source then there is no bar in the Act for claiming partners remuneration from such additional business income. Before us, Revenue has not controverted the findings of ld. CIT(A) nor has brought on record any contrary binding decision. We further find that Hon’ble Calcutta High Court in the case of Md. Serajuddin & Brothers vs. CIT reported in (2012 (8) TMI 104 - CALCUTTA HIGH COURT ) has held that even if the income from other sources is included in the Profit and Loss accounts, to ascertain the net profits qua book profit for computation of the remuneration of the partners, the same cannot be discarded. - Decided against revenue
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