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TMI Blog2005 (2) TMI 464X X X X Extracts X X X X X X X X Extracts X X X X ..... he disallowance of remuneration amount of Rs. 1,79,005 paid to the working partners of the assessee-firm. The AO during the assessment proceedings observed that the assessee has not reduced the unabsorbed brought forward depreciation of the earlier years from the profit of the year under reference before working out the remuneration payable to the partners. In view of this, the AO reduced the unab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earned Departmental Representative supported the orders of the lower authorities by submitting that unabsorbed depreciation of earlier years is a part of current year's depreciation under s. 32(2), which falls in Chp. IV-D and, therefore, for computation of book profit, unabsorbed depreciation has to be necessarily taken into account. Lastly, he justified the orders of the lower authorities. 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... even in the case of loss, a minimum of Rs. 50,000. Further, it may be mentioned that the remuneration received by the partners will have to be taxed either in the hands of the firm or in the hands of the partners. It cannot be taxed twice. Therefore, we modify both the orders of the lower authorities and direct the AO to allow the claim of the assessee as per s. 40(b)(v). Further, he is directed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case, we are of the view that the said brokerage was settled and finalised and paid during the assessment year under consideration. The assessee is following the mercantile system. Therefore, the same is allowable during the assessment year under consideration and we delete the addition of Rs. 90,577. This ground is allowed in favour of the assessee. 9. The third ground is pertaining to disa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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