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TMI Blog1997 (9) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment years 1984-85 and 1985-86, respectively. The assessee is a partnership firm. It had paid salary to one of the partners for the services rendered by him. The said partner had entered into the partnership as representing his Hindu undivided family. The payment of salary was disallowed under section 40(b) of the Income-tax Act, 1961 (for short "the Act"). On appeal, the decision of the Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Kar), this court on a consideration of the Explanation appended to section 40(b) of the Act, has held that the interest payments to Hindu undivided families, of which the partners of the firm were kartas, were not disallowable under section 40(b) of the Act. In the said judgment, this court was not concerned with the payment of salary to any of the partners of the firm, may be in a representativ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice of the Bench in the case of Mangalore Ganesh Beedi Works [1992] 193 ITR 77 (Kar), the same was rightly distinguished since in the latter case the question was related to payment of interest to a partner in a representative capacity, and was governed by the proviso to section 40(b) of the Act. Sri Sarangan, learned senior counsel appearing for the assessee, has brought to our notice an unr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtner of a firm. Moreover, in the case of Kalburgi Wine Distributors [1998] 230 ITR 159 (Kar), this court has not noticed the earlier binding precedent of this court in the case of N. M. Anniah and Co. [1975] 101 ITR 348. Accordingly, in our opinion, the order passed in I.T.R.C. Nos. 69 to 74 of 1994 (CIT v. Kalburgi Wine Distributors [1998] 230 ITR 159 (Kar)) referred to above is per incuriam and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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