No penalty can be levied where income is estimated

1. CIT vs Whiteline Chemicals (Guj) ITA 496/2012 dtd 15-01-2013
2. CIT vs Vatika Cosntruction Pvt Ltd ITA 1246/2010 dtd 11-10-2012
3. CIT vs P Rojes (Mad) 5-2-2013 ITA 341/2010

Allowability of partners' salary and interest against additional income under survey

Where survey is conducted on the assessee and assessee is able to prove that amount surrendered is from business and not income from other sources. Then deduction of partners' salary and partners' interest shall be allowed
CIT vs S.K. Sri Giri & Bros. 298 ITR 13 (Kar)

Where during survey additional income is surrendered by the assessee represented by excess stock and excess cash , then it has direct nexus with business of the firm. There fore partners remuneration shall be allowed out of additional income
Royal Sun rise vs ITO 99 TTJ 1305 (Bang)