Remuneration to Partners
This query is : Resolved
16 July 2009
A partnership firm (formed in F. Y. 2000 – 01) had capped the remuneration to partners at Rs. 60,000/- per partner per annum, vide the original partnership deed.
In January 2006, vide an addendum to the partnership deed, the firm increased the limit to Rs. 1,50,000/- per partner per annum.
A clause was inserted in the addendum to state that the aforesaid changes in the remuneration would be effective from 1st April 2006.
a) For the purpose of computing remuneration allowable u/s 40(b) of the I. T. Act, which limit would be considered?
b) If the copy of the addendum was not attached with the ROI, will the changes in remuneration be considered valid for the purpose of section 184 and / or section 40(b) of the I. T. Act?
Thanks & Reagrds
Niki
In January 2006, vide an addendum to the partnership deed, the firm increased the limit to Rs. 1,50,000/- per partner per annum.
A clause was inserted in the addendum to state that the aforesaid changes in the remuneration would be effective from 1st April 2006.
a) For the purpose of computing remuneration allowable u/s 40(b) of the I. T. Act, which limit would be considered?
b) If the copy of the addendum was not attached with the ROI, will the changes in remuneration be considered valid for the purpose of section 184 and / or section 40(b) of the I. T. Act?
Thanks & Reagrds
Niki
16 July 2009
Even you don't need to send the copy of addendum to ITO.
Hence you can claim the remuneration 1.5L per partner effective from 01-04-06.
Hence you can claim the remuneration 1.5L per partner effective from 01-04-06.
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