salary to partners

[ravindranath rao]

As per the decision of supreme court in the case of CIT vs Liberty India and the decision of Madras High Court in the case of CIT vs Jameel leathers and uppers, dutydraw back received from the government are not includible in the profits for the purpose of computing deduction under section 80 IB. On the same line dutydraw back received from the government is nothing but a type of incentive to promote the export business, hence It shall not be considered for computation of book profit for the purpose of computation of remmuneration to the partners of firm.

AI Summary

Duty drawbacks not included in profits for Section 80 IB deductions; incentives to promote exports, per court rulings. In a discussion about partner salaries, it was highlighted that, according to the Supreme Court and Madras High Court decisions, duty drawbacks received from the government should not be included in profits when calculating deductions under section 80 IB. Duty drawbacks are considered incentives to promote exports and should not be factored into the computation of book profit for determining partner remuneration. A participant asked if the issue was clarified, inviting further discussion if needed.