9911796707
TMI Blog2023 (12) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... e Income Tax Officer, Ward-5, Margao-Goa ['AO' in short]. 2. Pithily stated facts borne out of case records are; 2.1 The assessee is a partnership firm engaged in the business as real estate developers & civil contractors etc., had e-filed its return declaring total income of Rs.3,81,79,160/- after claiming a deduction of Rs.84,00,000/- u/s 40(b)(v) of the Act towards partners remuneration. 2.2 The assessee's version of computation of book profit was comprised of income from operation of Rs.3,00,000/- and balance of Rs.4,66,45,829/- represented by interest income earned/accrued, which was accepted by the Ld. AO by an order of assessment dt. 30/11/2016 framed u/s 143(3) of the Act. 2.3 Finding fault therewith, the Ld. PCIT invoked revisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at High Court in the case of 'CIT Vs J J Industries' reported in 358 ITR 531' wherein their Lordships have held that; 'The said chapter nowhere provides that method of accounting for the purpose of ascertaining net profit should be the only income from business alone and not from other sources. S. 29 provides how the income from profits and gains of business should be computed and this has to be done as provided u/s 30 to 43D. By virtue of s. 5 that total incomes of any previous years includes all income from whatever source derived. Thus for the purpose of s. 40(b)(v) read with the Explanation, there cannot be a separate method of accounting for ascertaining net profit and/or book-profit. The said section nowhere provides that the net pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly be excluded while determining allowable of deduction of remuneration to partners u/s 40(b)(v) of the Act. In the extent case, the interest income shall form part of business income for the purpose of computing admissible deduction u/s 40(b)(v) of the Act. 8. In the light of aforestated judicial binding precedents, we see no reasons to deviate therefrom. Resultantly in the impugned revisionary order passed setting-aside the assessment order in our considered view deserves to be quashed, therefore order accordingly. 9. Before parting, we are heedful to state that, the CBDT vide para (iv) of Circular No. 12/2019 dt. 19/06/2019 instruction 'to exclude all incomes such as capital gain, interest, rental income, income from other sources etc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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