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TMI Blog2024 (10) TMI 419X X X X Extracts X X X X X X X X Extracts X X X X ..... ory in nature. As we have noted above, in the present case the appellant has not charged any interest and remuneration as per partnership deed therefore, the appellant firm cannot be compelled to charge interest or remuneration. Further in the case of Myhome Developers [ 2021 (3) TMI 345 - GUJARAT HIGH COURT ] has held that though the clauses of the partnership deed provided for interest on partner's capital and remuneration, the same is subject to their mutual agreement. The clauses contained are only enabling provision not mandatory in nature so as to lead to an inference that, the assessee had to pay interest on capital and remuneration to its partners. No justification for making addition of interest when neither the assessee has cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further reserves his right to add, alter or to amend any of the aforesaid grounds at the time of hearing of an appeal. 2. Rival submissions of both the parties have been heard and record perused. At the outset of hearing, the learned Authorised Representative (ld. AR) of the assessee submits that a very short question is involved in the present appeal. The assessee is one of the partners in the firm Shrusti Corporation . The assessee is having 5% share in the said partnership firm. The assessee received profit from partnership firm of Rs. 14,97,555/- (approximately Rs. 15.00 lacs) which is exempt under Section 10(2A) of the Income Tax Act, 1961 (in short, the Act). The assessee filed his individual return of income for A.Y. 2012-13 on 28/0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the firm has not paid interest on capital to the partners. The Assessing Officer after recording reasons, issued notice under Section 148 of the Act the fag end of limitation period i.e. on 30/03/2019. The Assessing Officer while passing the assessment order, disallowed/added interest on the capital of assessee in the account of firm. The Assessing Officer worked out 12% interest on capital of assessee lying with the Shrusti Corporation thereby worked out addition of Rs. 6,59,035/-. The ld. AR of the assessee submits that initially the revenue has disallowed entire claim of deduction under Section 80IB of the Act while passing the assessment order in case of firm and when relief was allowed by the ld. CIT(A), the case of assessee was again ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pak Ratnabhai Patel Vs ITO (2021) 125 taxmann.com 79 (Guj) ACIT Vs Aarav Diamonds, Surat ITA No. 240/Srt/2018 ACIT Vs Raivat Impex, Surat, ITA No. 56/Srt/2018 Mukta Enterprise (2018) 100 taxmann.com 33 (Surat Trib) Al Reza Food Vs ITO ITA No. 633/Ahd/2014 Vahid Paper Vs ITO ITA No. 1409 to 1412/Ahd/2009 ACIT Vs Kiran Jewellery Surat ITA No. 192/Srt/2017 Myhome Developers Vs ACIT (2021) 129 taxmann.com 120 3. On the other hand, the learned Senior Departmental Representative (ld. Sr. DR) for the revenue supported the orders of lower authorities. On the objection of ld. AR of the assessee that initially deduction under Section 80IB(10) of the Act was disallowed, the ld. Sr.DR for the revenue submits that the deduction under Section 80IB was di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of firm is also pending before the ld. CIT(A) and requested to keep the appeal of assessee in abeyance till disposal of appeal in the partnership firm. The request of assessee for keeping the decision in abeyance was not accepted by the ld. CIT(A). The ld. CIT(A) held that profit in the firm is too high and it is not a case that there is no provision in the partnership deed for payment of interest on capital contribution. Before me, the ld. AR of the assessee while making his submission vehemently argued that in fact no interest was paid on capital contribution by assessee in the partnership firm and that there is no compulsion on the firm for making such payment of interest rather than similar interest has been added in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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