2000 (7) TMI 971

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..... appeals by the assessee relate to the assessment years 1993-94 and 1994-95 and the only question in the appeals is whether the assessee is entitled to the deduction of the interest paid in respect of the amounts borrowed for the capital invested in the firm in which he is a partner, against the income by way of remuneration received by him from the firm. 2. From the assessment year 1993-94, a new .....

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..... m is to be assessed under the head 'business', any interest paid by the partner for the purpose of earning the remuneration must also be deducted. A fiction must be extended to its logical conclusion and one's mind shall not boggle down when it comes to the extension of the fiction to all its logical consequences. The objection raised by the revenue authorities is that the interest is not paid for .....

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..... son for payment of salary may be the service contract, but the causa causans is the partnership. The Supreme Court held that when an arrangement is made by which a partner works and receives amounts as wages for services rendered, the agreement should in truth be recorded as a mode of adjusting the amount, that must be taken to have been contributed to the partnership's assets by a partner, who ha .....

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