Just a moment...

Report
FeedbackReport
×

By creating an account you can:

Logo TaxTMI
>
Feedback/Report an Error
Email :
Please provide your email address so we can follow up on your feedback.
Category :
Description :
Min 15 characters0/2000
TMI Blog
Home / RSS

Admissibility of deduction on account of salary/interest to partners of firms opting for estimation of income under sections 44AD and 44AE sections 44AD and 44AE

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ted 23/2/1996 Sections 44AD and 44AE were inserted in the Income-tax Act, 1961, by the Finance Act, 1994, with effect from April 1, 1994. Section 44AD provides for a method of estimating income from the business of civil construction or supply of labour for civil construction work, where the gross receipts from the business do not exceed Rs. 40 lakhs. Section 44AE provides for a method of estimat....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....d under section 40(b) in such cases. The doubt has primarily arisen because of the erroneous clarification given in paras. 31.3 and 32.2 of the Explanatory Notes on provisions of the Finance Act, 1994 (Circular No. 684, dated 10th June, 1994 (see [1994] 208 ITR (St.) 8)). The relevant portion of the Explanatory Note reads as under :_ "In the case of firms, the normal deductions to the extent allo....