https://www.taxtmi.com/caselaws?id=27023 The court upheld the assessee's contention that only the net interest payable to partners, after deducting interest due by partners to the firm, should be disallowed under section 40(b) of the Income-tax Act, 1961. The court emphasized the binding nature of CBDT circulars on Income-tax Officers and referenced relevant case law to support its decision. The court also highlighted the clarification introduced by the Taxation Laws (Amendment) Bill, 1984, reinforcing the position that only net interest should be disallowed. Consequently, the court ruled in favor of the assessee, directing that only the net interest amount be added back in computing the total income of the firm. en-us Wed, 10 Oct 1984 00:00:00 +0530 Wed, 10 Feb 2010 12:25:47 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=27023 The court upheld the assessee's contention that only the net interest payable to partners, after deducting interest due by partners to the firm, should be disallowed under section 40(b) of the Income-tax Act, 1961. The court emphasized the binding nature of CBDT circulars on Income-tax Officers and referenced relevant case law to support its decision. The court also highlighted the clarification introduced by the Taxation Laws (Amendment) Bill, 1984, reinforcing the position that only net interest should be disallowed. Consequently, the court ruled in favor of the assessee, directing that only the net interest amount be added back in computing the total income of the firm. Case-Laws Income Tax Wed, 10 Oct 1984 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=27023