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What is Consideration for know-how? What is Assessment as a firm? Section 180A and 184 of Income Tax Act 1961

Consideration for know-how and Assessment as a firm are defined under section 180A and 184 of Income Tax Act 1961. Provisions under these Sections are :

Section 180A of Income Tax Act "Consideration for know-how"

Section 180A. Where the time taken by an individual, who is resident in India, for developing any know-how is more than twelve months, he may elect that the gross amount of any lump sum consideration received or receivable by him during the previous year relevant to the assessment year commencing on the 1st day of April, 2000 or earlier assessment years for allowing use of such know-how shall be treated for the purposes of charging income-tax for that year and for each of the two immediately preceding previous years as if one-third thereof were included in his income chargeable to tax for each of those years respectively and if he so elects, notwithstanding anything contained in any other provision of this Act,-

 

(a) such gross amount shall be so treated, and

(b) the assessments for each of the two preceding previous years shall, if made, be accordingly rectified under section 154, the period of four years specified in sub-section (7) of that section being reckoned from the end of the financial year in which the assessment relating to the previous year in which the amount was received or receivable by such individual is made.

Explanation.-For the purposes of this section, the expression "know-how" has the meaning assigned to it in section 35AB.

Section 184 of Income Tax Act "Assessment as a firm"

184. (1) A firm shall be assessed as a firm for the purposes of this Act, if-
(i) the partnership is evidenced by an instrument ; and
(ii) the individual shares of the partners are specified in that instrument.

(2) A certified copy of the instrument of partnership referred to in sub-section (1) shall accompany the return of income of the firm of the previous year relevant to the assessment year commencing on or after the 1st day of April, 1993 in respect of which assessment as a firm is first sought.

Explanation.-For the purposes of this sub-section, the copy of the instrument of partnership shall be certified in writing by all the partners (not being minors) or, where the return is made after the dissolution of the firm, by all persons (not being minors) who were partners in the firm immediately before its dissolution and by the legal representative of any such partner who is deceased.

(3) Where a firm is assessed as such for any assessment year, it shall be assessed in the same capacity for every subsequent year if there is no change in the constitution of the firm or the shares of the partners as evidenced by the instrument of partnership on the basis of which the assessment as a firm was first sought.

(4) Where any such change had taken place in the previous year, the firm shall furnish a certified copy of the revised instrument of partnership along with the return of income38 for the assessment year relevant to such previous year and all the provisions of this section shall apply accordingly.

(5) Notwithstanding anything contained in any other provision of this Act, where, in respect of any assessment year, there is on the part of a firm any such failure as is mentioned in section 144, the firm shall be so assessed that no deduction by way of any payment of interest, salary, bonus, commission or remuneration, by whatever name called, made by such firm to any partner of such firm shall be allowed in computing the income chargeable under the head "Profits and gains of business or profession" and such interest, salary, bonus, commission or remuneration shall not be chargeable to income-tax under clause (v) of section 28.

Income Tax Act 1961

What is Consideration for know-how? What is Assessment as a firm? Section 180A and 184 of Income Tax Act 1961

What is the procedure of Assessment when section 184 not complied with? What is change in constitution of a firm? What is succession of one firm by another firm? Section 185, 187 and 188 of Income Tax Act 1961

What is Joint and several liability of partners for tax payable by firm? Firm dissolved or business discontinued? Section 188A and 189 of Income Tax Act 1961

What are the Provisions applicable to past assessments of firms? What is tax Deduction at source and advance payment? Section 189A and 190 of Income Tax Act 1961

What is Direct payment? What is Salary? Section 191 and 192 of Income Tax Act 1961

What is Payment of accumulated balance due to an employee? What is Interest on securities? Section 192A and 193 of Income Tax Act 1961

What are Dividends? Section 194 of Income Tax Act 1961

What is Rent? Section 194 I of Income Tax Act 1961

What is Interest other than Interest on securities? Section 194A of Income Tax Act 1961

What is Winnings from lottery or crossword puzzle? What is Winnings from horse race? Section 194B and 194BB of Income Tax Act 1961

What is Payments to contractors? Section 194C of Income Tax Act 1961

What is Insurance commission? What is Payment in respect of life insurance policy? Section 194D and 194 DA of Income Tax Act 1961

What is Payments to non-resident sportsmen or sports associations? What is Payments in respect of deposits under National Savings Scheme? Section 194E and 194EE of Income Tax Act 1961

What is Payments on account of repurchase of units by Mutual Fund or Unit Trust of India? What is Commission, etc., on the sale of lottery tickets? Section 194F and 194G of Income Tax Act 1961

What is Commission or brokerage? What is Payment on transfer of certain immovable property other than agricultural land? Section 194H and 194IA of Income Tax Act 1961

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