SUHAS MITRA (ARTICLE ASSITANT) (54 Points)
28 August 2011SHALL ANY INCOME EARNED BY ANY PARTNERSHIP CONCERN , ENGAGING IN TRANSACTION NOT AUTHORISED BY PARTNERSHIP DEED BE TAKEN INTO ACCOUNT WHILE COMPUTING INCOME UNDER THE HEAD P/G/B/P OF THE FIRM AND ALSO IN BOOK PROFITS TO BE COMPUTED U/S 40(b) ?
( e.g FIXED DEPOSIT INTEREST WHEREAS INVESTMENT IN FIXED DEPOSIT IS NOT AUTHORISED BY PARTNERSHIP DEED )
PLEASE LET ME KNOW AS SOON AS POSSIBLE .
Dintakurthi Tirumala
(CA FINAL)
(15989 Points)
Replied 05 September 2011
Restruction on doing business(require authorised by partnership deep) is restructed by the Partnership act. But income tax purpose all incomes are liable for tax(eventhough illegal activities). So u have to offer income from FDs to incometax. I think the partnership business is not the investments in FDs so it will consider as other Income for tax purpose thus it will not includable for computation of BOOK PROFIT.
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