TMI Blog2002 (11) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... 00 paid to Shri S.R. Shah, in their individual capacities even though each of them was a partner in the assessee-firm in his capacity as karta of his Hindu undivided family?" - we are of the view that the Tribunal and other revenue authorities were justified in disallowing the amount of expenditure incurred by the assessee-firm in the nature of salary and consultation fees paid to its partners. - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 500 paid to Shri S.R. Shah, in their individual capacities even though each of them was a partner in the assessee-firm in his capacity as karta of his Hindu undivided family?" The learned advocate, Shri B.D. Karia, has appeared for the applicant-assessee whereas learned senior Central Government standing counsel, Shri M.R. Bhatt, has appeared for the Revenue. The facts giving rise to the refer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the circumstances, the question which has been referred to this court is whether the salary or the consultation fees paid to the partners by the assessee-firm can be disallowed under the provisions of section 40(b) of the Act. It is relevant to note that both the partners, namely, Shri N.R. Shah as well as Shri V.R. Shah, were representing their respective Hindu undivided family and, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Supreme Court in the case of Rashik Lal and Co. v. CIT [1998] 229 ITR 448, that a Hindu undivided family cannot be a partner but only a karta representing the Hindu undivided family can become a partner in a partnership firm. Looking to the said judgment delivered by the Supreme Court, this court has held in National Wire Mfg. Co.'s case [2002] 253 ITR 496, that the salary or the consultatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
