Chennai ITAT denies
assessee-partner’s claim of estimating income on presumptive basis u/s. 44AD
with respect to interest and remuneration earned from the partnership firms
during AY 2012-13; While filing return of income, assessee had applied
presumptive rate @ 8% u/s 44AD on interest and remuneration received from
various partnership firms, however, AO had denied the claim on the ground
that assessee was not doing any business independently but was only a partner
in the firms; Referring to Sec. 28(v) read with Section 40(b), ITAT
acknowledges that remuneration and interest received from a firm, to the extent
eligible u/s 40(b), would be considered as ‘profits and gains from business or
profession’ of the recipient partner; However, ITAT clarifies that “This by
itself…would not translate such remuneration and interest, to gross receipts or
turnover …of a business independently carried on by a partner.”; ITAT opines
that the intention of insertion of Sec. 44AD was to help small business to
comply with the taxation provisions and that the “Intention was not at all to
construe a partner’s remuneration or interest as business income.”:ITAT
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