Provisions of section 40(b)(v) of the Income-tax Act, 1961, regarding admissibility of remuneration of working partner in the assessment of firms - Regarding

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....3/1996 The Board have received representations seeking clarification regarding disallowance of remuneration paid to the working partners as provided under section 40(b)(v) of the Income-tax Act. In particular, the representations have referred to two types of clauses which are generally incorporated in the partnership deeds. These are : (i) The partners have agreed that the remuneration to a wor....

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....he view that a liberal approach may be taken for the initial years. It has been decided that for the assessment years 1993-94 to 1996-97 deduction for remuneration to a working partner may be allowed on the basis of the clauses of the type mentioned at 1(i) above. 3. In cases where neither the amount has been quantified nor even the limit of total remuneration has been specified but the same has ....