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TMI Blog2005 (2) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... and not to the company. Since he was a partner in the respondent-firm, the provisions of section 40(b) of the Act were clearly attracted. Payment has been made directly by the respondent-firm to one of its partners, namely, Sri Sardar Nanak Singh, for the advice rendered by him. - In this view of the matter, the Tribunal was not justified in holding that the provisions of section 40(b) of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company on certain terms and conditions. The business consists of manufacturing and sale of different brands of liquors. Some of the terms of the agreement are reproduced below: "(i) The properties owned by the said company will continue to be the property of the company but the assessee could install and purchase new plant and machinery, etc., which could be taken back by the assessee on the ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nak Singh. It may be mentioned here that Sri Sardar Nanak Singh was earlier managing director of the company and some time in January 1982, Sri Sardar Nanak Singh has resigned as managing director of the said company and also resigned from the directorship of the company, but the company persuaded him to be business adviser for the company for which remuneration was fixed at Rs. 2,000 per month by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any agreement between the partners or between the partnership firm and the partners. It consequently held that the provisions of section 40(b) of the Act are not applicable. We have heard Sri A.N. Mahajan, learned standing counsel for the Revenue. Nobody has appeared on behalf of the respondent-assessee. It has been stated by Sri Mahajan that the entire business of the company was taken over by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondent-firm, the provisions of section 40(b) of the Act were clearly attracted. Payment has been made directly by the respondent-firm to one of its partners, namely, Sri Sardar Nanak Singh, for the advice rendered by him. In this view of the matter, the Tribunal was not justified in holding that the provisions of section 40(b) of the Act are not attracted. We accordingly answer the qu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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