1982 (10) TMI 89

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....est. The assessee purchased two lorries and did not ply them herself, but handed them over to Rama Transport for its business. However, she paid two amounts of Rs. 5,260 as insurance and Rs. 2,251 as permit expenses and also paid taxes on the same. The assessee claimed these expenses against the share income from the firm. Since she did not ply these lorries herself, in the view of the ITO, these expenses could not be allowed in her individual assessment. This view was confirmed by the first appellate authority. 3. The learned representative for the assessee relied on a commentary of Sampath Iyanger, for the view that what is allowed against the share income is not necessarily limited to interest on borrowed capital. He also cited the au....

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....amniklal Kothari [1969] 74 ITR 57. There are two departures in the 1961 Act. The first departure is that the partners' share income is now assessable under several heads, in the same proportion as the classification in the hands of the firm. The second departure is that it is specifically enacted that the partner would be entitled to deduction of interest on capital borrowed, for the purposes of investment in the firm. There is, therefore, no scope for the revenue's argument that the decision of the Supreme Court in Kothari's case under the 1922 Act may not apply now. There is further scope for the argument that only interest on capital borrowed is to be allowed against such share income. The matter has now been resolved by a number of deci....