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TMI Blog2020 (12) TMI 800X X X X Extracts X X X X X X X X Extracts X X X X ..... ginal assessment was subject to revision u/s. 263 of the Act, whereby the Assessing Officer (AO) was directed to reframe the assessment after considering three different aspects of the assessee's return/affairs, aggregating to Rs. 5,69,330, qua which, in the opinion of the revision authority, the assessment as made was deficient, inasmuch as the AO had: (a) not brought to tax other income of Rs. 1,77,273/-, being Jeep rent (Rs. 59,299) and bank interest (Rs. 1,17,974/-); (b) allowed the assessee interest and remuneration to partners at Rs. 3,79,557/-, as debited to the profit and loss account, even as net profit of the business had been estimated by him, implying deduction of all expenses, so that there was no scope for separate deducti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1(a)), was upheld (per para 4.4). Para 5 of the Tribunal's order contains it's concluding remarks. The same, read with para 6, reads as under: '5. The only adjustment, therefore, that obtains consequent to the set aside by the ld. CIT is the assessment of Rs. 1,77,273/- as income from other sources u/s. 56, i.e., as assessed. The assessee's business income shall continue to be at Rs. 14,47,620/-, i.e., as original assessed. We are conscious that the allowance of deduction for remuneration to partners, allowed at Rs. 1,30,000, is to be w.r.t. 'book profit' (Explanation 4 to s. 40(b)(v)), so that the enhancement in income upon estimation would have no bearing on the quantum of the said deduction. The same, however, has been considered w.r. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no basis for either a review of the said estimate, revised to 8%, or for regarding it as having been made after the allowance of interest and salary to the partners, so as to preclude their allowance, as argued by the Revenue. No adjustment in respect thereof is accordingly called for.' Clearly, therefore, no adjustment to the returned income on account of interest and remuneration to partners, it held, is called for. Para 5 of its order accordingly clarifies that the business income will remain the same, i.e., as originally assessed (at Rs. 14,47,620), which is after deduction of both interest and remuneration to partners, so that the only adjustment that obtains, post its' order, is for Rs. 1,77,273, assessable u/s. 56. The reference t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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