The Delhi High Court has intervened in a significant taxation issue concerning bonuses received by partners in professional firms, including those affiliated with the Big 4 audit firms. The court has stayed tax recovery proceedings against a partner of S R Batloi & Co (SRB), the audit arm of Ernst & Young, and directed the Central Board of Direct Taxes (CBDT) to provide clarity on the matter. Tax officers in cities like Delhi, Mumbai, and Chennai have been assessing taxes on bonuses, which partners argue have already been taxed at the firm level. Legal experts suggest that remuneration exceeding profit share should be treated as exempt income, as established in the new Income Tax Act. This situation raises concerns about the simultaneous taxation of the same income at both the firm and partner levels, a position supported by a 2022 tribunal ruling. The court's decision reflects the potential for broader implications affecting numerous partners across India, prompting the CBDT to examine the issue further.