Partnership remuneration and interest limits: assessors must verify deeds, compute book profit and cross check partner returns. Assessing Officers must cross verify firm expenditures like interest on capital and partner remuneration with partners' returns and obtain the partnership deed to ensure payments are authorised and relate to periods after the deed. Interest and remuneration must be computed and allowed strictly in accordance with the partnership deed and limited by the aggregate ceiling based on book profit, excluding non business income. AOs should enforce compliance that can deny deductions, prevent profit inflation for preferential deductions, verify carry forward claims on change of constitution, and use tax audit reports effectively.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Partnership remuneration and interest limits: assessors must verify deeds, compute book profit and cross check partner returns.
Assessing Officers must cross verify firm expenditures like interest on capital and partner remuneration with partners' returns and obtain the partnership deed to ensure payments are authorised and relate to periods after the deed. Interest and remuneration must be computed and allowed strictly in accordance with the partnership deed and limited by the aggregate ceiling based on book profit, excluding non business income. AOs should enforce compliance that can deny deductions, prevent profit inflation for preferential deductions, verify carry forward claims on change of constitution, and use tax audit reports effectively.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
of 
Join Channel
TaxTMI 
