2003 (3) TMI 52

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....he question raised in this appeal filed by the Revenue is: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the remuneration paid by the assessee to its partner representing a Hindu undivided family can be disallowed under section 40(b) of the Income-tax Act, 1961, in the light of the Explanation 4 to the section by the Amendme....

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....1998] 229 ITR 458 has held that: "There is no way that a Hindu undivided family can intrude into the relationship created by a contract between certain individuals. The only right of the Hindu undivided family is possibly to call upon its nominee partner to render accounts for the profits that he has made from the partnership business. But that is something between the nominee and the Hindu undivi....

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.... Hindu undivided family. The partner may be accountable to the family for the monies received by him from the partnership. But, in the assessment of the firm, the partner cannot be heard to say that he has not received the commission as a partner of the firm, but in a different capacity." Having regard to that position in law, the remuneration paid to the individual partners who are working par....