Assessee Particulars:
Status:Firm, Asst.year:2007-08, Business:BPO Services i.e receiving data in one form and converted into another form.
Facts:
In the year 2006-07, the assessee filed return in due time and claiming refund of Rs.354000 from the total TDS of Rs.394800.
In the particular case the assessee did not deduct tax on the sub-contract charges of Rs.40 lakhs, the turnover of the company is 108 lakhs.
During assessment the ITO has disallowed the entire amount of Rs.40 lakhs and issuing demand notice of Rs.16.72 lakhs.
Now the status of the firm gets into individual i.e one of the partner is retired, now the remaining assessee can claim the entire amount of Rs.40 lakhs provided he will deduct TDS and remit to the govt. before 31 mar.2010. for the Asst. year 2010-11 in his individual status.
The retiring partner mutually agreed with the existing partner that there is no liability to the firm and the firm to the retiring partner. In this situation how can the problem gets solved.
Question:
1.Can the disallowance of Rs.40 lakhs be claimed by the existing partner in his individual capacity provided he fulfills all the conditions of remiting TDS and take over the existing business fully.
2.If he eligible for claiming expenses, in which name it is to be claimed i.e in the firm name or individual name
Kindly clarify
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