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TMI Blog2009 (9) TMI 870X X X X Extracts X X X X X X X X Extracts X X X X ..... e cross appeals relate to the AY 2006-07. The assessee is a partnership firm engaged in the business of land development and construction of buildings. 2. In the appeal by the assessee, the only issue is about the disallowance of the remuneration paid to the partners in the amount of Rs.27,00,000. The Assessing Officer regulated the same u/s.40A(2)(b) of the IT Act which is objected to by the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view taken by the income-tax authorities is wrong. From the copy of the order placed before us, we find that in paragraph 7.2 of the order the Tribunal has considered the issue. The Tribunal has referred to the judgment of the Hon'ble Gujarat High Court in Yoganand Textiles (202 ITR 869) and the earlier order of the Ahmedabad Bench in the case of Chhajed Steel Corporation (69 TTJ 232) and held th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ete the disallowance of Rs.27,00,000 and allow the appeal of the assessee with no order as to costs. 5. In the appeal by the department, the only issue is whether the amount of Rs.7,00,000 paid by the assessee to SMC (Surat Municipal Corporation) is allowable as a deduction in computing the profits of the business of the assessee. The amount was paid as 'premium fee' for covering the balconies an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntical controversy in ITA Nos. 1681 & 1682/AHD/2006 and CO Nos.210 & 211/AHD/2006 in the case of ACIT v Enviro Control Associates (I) Pvt. Ltd., Surat and by order dated 20-3- 2009 has held, following the Delhi High Court's judgment cited supra that the payment made to Surat Municipal Corporation was not in the nature of penalty for infraction of law and was allowable as a deduction in computing t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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