TMI Blog2005 (8) TMI 288X X X X Extracts X X X X X X X X Extracts X X X X ..... id down in Chapter IV-D. Thus, this cash credit forms part of book profit. The assessee is not carrying on any other business and has no other source of income. Thus, whatever income arising to the assessee is business income and hence, computation is in accordance with Chapter IV-D. Thus, it can be held that such cash credit forms part of book profit for the purpose of computation of remuneration. The AO is directed to include such cash credit in the book profit for the purpose of allowing remuneration to the partners which is authorized by and in accordance with the terms of partnership deed. In the result, the appeal is allowed. - HON'BLE P. MOHANARAJAN, J.M. AND DEEPAK R. SHAH, A.M. For the Appellant : V. Srinivasan and Virupanna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 1,66,290. Same is the case with regard to discount amounting to Rs. 1,79,212. In the interest of natural justice, the AO is directed to provide adequate opportunity to the assessee to prove these expenses and cross-verify the payment of incentive and discount. 1.3 When the AO conducted further enquiry pursuant to such remand report, the assessee filed necessary details. However, while passing the impugned order, learned CIT(A) held that there is no question of providing cross-examination facility to appellant. The payment of discount is not genuine . The assessee, therefore, challenges the above finding. 1.4 Learned counsel for assessee, S/Shri V. Srinivasan and Virupanna Amberkar submitted that learned CIT(A) has gone against his own ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any credit in the books of account and forming part of profit as per P L a/c is to be considered for the purpose of book profit defined in s. 40(b). Sec. 68 is not independent of any of the charging provisions and the income is taxed under either of the heads. In the present case, the cash credit is nothing but part of book profit and accordingly taxed as business income. When it is taxed as business income as per s. 40(b), such income forms part of book profit and remuneration thereon is allowable, which is authorized by and in accordance with terms of partnership deed. For this proposition, he relied upon the decision of Tribunal Bangalore, in ITA No. 325/Bang/1997 in the case of Sharada Rice Mills, dt. 18th Dec., 2000. 3.3 Learned Depar ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
