TaxTMI 
TaxTMI 
2014 (7) TMI 3
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....lowance u/s. 14A of Rs.10,59,174/- was correctly made by the AO in respect of profit of Rs.57,54,075/- and total taxable income of Rs.2,23,92,204/- received from firm." 2. Rival contentions have been heard and record perused. The assessee has been equity partner with legal firm, M/s. Amarchand Mangaldas & Suresh A. Shroff & Co. with effect from 1st October, 2008. The assessee has received share in profit of Rs.57,54,075/- and further received Rs.68,57,206/- as partner's salary from the same firm and professional fees of Rs.1,55,34,998/-. The assessee has debited expenses of Rs.51,80,992/- in the P & L account. During the course of assessment AO asked the assessee to show cause as to why disallowance should not be made u/s.14A in respect of....
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....ll determine the amount of expenditure incurred in relation to exempt income if he is not satisfied with the correctness of the claim of the assessee. It is seen that the appellant has not incurred any expenditure in relation to earn the share of profit and partner's remuneration from the firm. The investment of fixed capital amounting to Rs. 16,00,000/- has been made out of own fund/ non interest bearing fund. Hence, no interest in relation to share of profit and remuneration from the partnership firm has been incurred. The expenditure of Rs.51,80,992/- is debited against the professional income of Rs.1.55 crores hence, same is not incurred in relation to exempt income. Therefore, this expenditure cannot be related for earning exempt incom....
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....Amarchand Mangaldas & Suresh A. Shroff & Co. Against the professional fee of Rs.1.55 crores the Assessee has claimed business expenses of Rs.51.80 lacs. However, the Assessee has not incurred any expenses towards becoming partner in the firm and as such no expenses were incurred against the remuneration received/ share of profit received from the firm. Whatever expenditure is incurred is for carrying out his professional consultancy in his personal name for which Assessee was receiving a fee of Rs.1.55 crores. Thus we find that against the income of Rs.1.55 crores Assessee claimed expenses only of Rs.51.80 lacs which is 33.5% of professional income. We find that Assessee made capital investment of Rs.16.00 lacs by way of fixed capital in th....