recovery of insurance claim.

Querist : Anonymous (Querist) 13 December 2009 This query is : Resolved
Mr x was a partner of a partnership firm in 1974,. it occoured a loss due to fire and lodge a claim to insurance company.latter on firm discontinued its business completely. insurance company met the claim in 2008-09.and pay rs 1800000. now on request of the other partners ins. compan issued the cheque in the name of one of the partners,Mr. X. who will be liable to pay tax Mr. X or the firm?give case law if any.

Follow Query

Report Abuse

Vineet (Expert) 13 December 2009
As per provisions of section 176(3A) of the Act, in the case of discontinued business, any receipt in the nature of income shall be deemed to be income of the assessee in the year of receipt. In the case of dissolved firm, the income shall be taxed through its partner at the time of discontinuance.

Vineet (Expert) 13 December 2009
Please refer to CIT vs Star Andheri Estate 208 ITR 573 (Bom.)

Querist : Anonymous (Querist) 13 December 2009
but the in the act it has been written that where .......,if such sum would have been included in the total income of the person who carried on the business had such sum been received before such discontinuance.
what is the effect of this clause??

Raj Kumar Makkad (Expert) 13 December 2009
repeated quarry

Khaleel Ahmed Mohammed (Expert) 13 December 2009
Repeated quarry.

Vineet (Expert) 13 December 2009
it only means that the receipt should be in the nature of taxable income.

If a particular receipt was not taxable or includible in taxable income at the time of discontinuance of business, the same cannot be taxed in the year of receipt also.

Sachin Bhatia (Expert) 19 December 2009
All the partners will be liable to contribute towards the payment of tax according as per their shares.

Previous

Next

You need to be the querist or approved LAWyersclub expert to take part in this query .

Click here to login now

Similar Resolved Queries :

Ask Query
Unanswered Queries