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TMI Blog2008 (12) TMI 275X X X X Extracts X X X X X X X X Extracts X X X X ..... scribed in the statute itself. In our humble understanding of law since the statute has used the term authorize therefore, the CBDT has no jurisdiction to substitute the term authorize by the term quantify . While interpreting the clause of a statute there is no scope for importing into the statute some other words which are not there, Such an interpretation, if any made, by any of the authority would amount to an amendment in the statute which is a prerogative of the legislative body i.e. Hon'ble Members of the Parliament. We are very well aware that even if there be a situation of casus omissus even then the defect can be cured only by a proper legislation and not by any interpretation. To our understanding, there appears no justification to deviate from the general principles of interpretation according to which the intention of the legislature is to be interpreted from the terms used or the words contained in a statute. It is also not a case that the impugned taxing provisions were ambiguous and therefore capable of more than one interpretation. To us, there was no ambiguity in the language of the said section, hence there is no question of a beneficial interp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he basis of photo-copy of a partnership deed not submitted along with return of income, though the assessee had not complied with the requirements laid down in sub-s. (4) of s. 184 of the IT Act, 1961, and hence invited the rigours of s. 185 of the IT Act, 1961? 3. Whether, on facts and in the circumstances of the case and in law, the learned CIT(A) was justified in deleting the addition of Rs. 2,03,350, being the amount of unsecured loans, on the ground that it relates to a matter unconnected with the escapement of income, overlooking the established legal position that in an assessment or reassessment proceedings under s. 147, the jurisdiction of the AO to assess matters in respect of such items which have been found during the course of such assessment or reassessment, to be under-assessed or not been charged to tax is absolute and unfettered?" 2. Corresponding assessment orders for both the years were passed under s. 143(3) identically dt. 28th March, 2005. The AO has noticed that the assessee has claimed salary to partners of Rs. 2,20,000 for asst. yr. 1999-2000 and Rs. 2,10,000 for asst. yr. 2000-01. However, in his opinion as per the partnership deed filed along with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9, it was held as under: "19. Ground No. 9 relates to the issue, of the validity of the partnership deed produced by the appellant. In this connection, it is observed while scrutinizing the assessment record that partnership deed dt. 5th April, 1999 was filed along with the return of income itself for the asst. yr. 1999-2000. As already discussed above that during the course of the assessment proceedings itself the appellant filed the partnership deed dt. 5th April, 1999 which is more or less the same as filed along with the return. The assessee has also filed certified copy of the partnership deed from the PWD, Hingoli, evidencing the fact that this partnership deed was in existence during the previous year relevant to the assessment year in question. Therefore, looking into the totality of the circumstances, it can be said that the partnership deed dt. 5th April, 1999 is genuine partnership deed and on the basis of the partnership deed, the assessee is entitled to claim the remuneration paid to the partners and as the payment of salary is being authorized by this partnership deed to the 4 partners. The partners have also reflected their remunerations in their respective returns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tnership deed. then the amount of such payment of partnership should not exceed the aggregate amount as prescribed in this sub-clause. Meaning thereby that s. 40, cl. (b), sub-cl. (ii) and another sub-cl. (v) prescribes that a deduction in the case of a firm can be allowed in respect of salary or remuneration to working partners if it is duly authorized by the terms of a partnership deed however, to the extent of prescribed limit as has also been prescribed in the statute. Therefore, on plain reading of this section it is understood by us that these sections do not make it mandatory to quantify the amount of salary in one of the clauses of the partnership deed because of the main reason that the monetary limit or ceiling is otherwise prescribed in the statute itself. The language of s. 40(b)(ii) is as under: "(ii) any payment of remuneration to any partner who is a working partner, or of interest to any partner, which, in either case, is not authorized by, or is not in accordance with, the terms of the partnership deed." 5.1 We have reproduced the language to make it clear that the statute has used the term "authorize" and not used the term "quantify". On the other hand, the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proposition, we place reliance on CED vs. R. Kanakasabai Ors. 1973 CTR (SC) 227 : (1973) 89 ITR 251 (SC). 5.2 Next is the question that what will be impact of alleged change of p. 5 in the partnership deed as pointed out by learned Departmental Representative. This serious allegation was strongly refuted by learned Authorised Representative by placing on record a certified copy of said partnership deed which was stated to be filed before PWD who has certified the said deed dt. 5th April, 1999. The contention was that even if the clause of the deed, more particularly cl. 10, is taken into consideration as per the deed alleged to be with the AO. even then the authorization of salary was very much incorporated in cl. 10 therein. The vehement contention was that once the authorization was admitted in the said deed which was claimed to be with the AO then also the assessee deserves due relief. It was also contended that the assessee had no intention of wrongful gain because he was entitled for the claim of salary on the basis of the authorization made in the partnership deed. We find force in this argument of learned Authorised Representative because in our considered opinion no ga ..... X X X X Extracts X X X X X X X X Extracts X X X X
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