Section 40(b) Clarified: Interest to Partners Yields Nil Impact, No Double Disallowance, Confirms Tax Appeal.

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....Addition u/s 40(b) - interest payment to partners - in the computation of income the interest of partner is added and deducted and thus, the effect while preparing the computation of income is nil and there is no loss of revenue - Merely the said adjustment not done in the profit & loss account the double disallowance cannot be made. Even the ld. CIT(A) has also confirmed that in the computation of income the same is disallowed and allowed giving it the effect as Nil. In terms of these observations the ground no. 1 raised by the assessee is allowed. - AT....