Partners' salary u/s 44ad

ejaz naiyer (C.A. FINAL) (293 Points)

08 May 2012  

Under section 44AD there is provision of 8% profit. In the case of partnership firm partners salary & Interest on capital is allowable. It means if befor salry and interest is above 8% and  after partners salary and interest on capital the net profit is below 8% (say 3%) there is no requirement  of tax audit under section 44AB. 

I want to know whether my contention is true or not?