Section 10(2A)

Section 10(2A) — the law in short

What the courts have decided on section 10(2A), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.

• Sobha Developers Ltd v DCIT High CourtHelps taxpayerValidity unconfirmed
  Can the Rule 8D figure be added back to book profit under clause (f) of the Explanation to s.115JB?
  The Karnataka High Court held it cannot. A disallowance under s.14A is a notional disallowance, and the amount cannot be added back to book profit under clause (f) by taking recourse to s.14A. Clause (f) can operate only on amounts actually debited to the profit and loss account.
• Statutory position — sections 10(2A) and 28(v): the share of profit is exempt, the remuneration and interest are not CBDT Circulars & InstructionsCuts both ways
  The AO says the whole of what I received from my firm is taxable. Which part of a partner's receipts from his firm is actually exempt, and how is the exempt share computed?
  Only the partner's share in the total income of the firm is exempt, and only where the firm is separately assessed as such — that is section 10(2A). Interest, salary, bonus, commission and remuneration due to or received by a partner from the firm are not covered by the exemption at all; they are charged in the partner's hands as business income under section 28(v). The proviso to section 28(v) then works the other way, reducing the partner's income to the extent the firm was denied the deduction under section 40(b).

Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.