29 September 2014
A transport business partnership firm has sold through book entry ( Agreement was made)few vehicles to one of its partner.The respective vehicles were under contract with some PSU in the name of firm, the PSU is paying directly to that partner account but paying the amount against firms PAN( reported in 26AS of the firm). Now tell me plz that How can the accounts be settled in firm books so that we can explain to the income tax authorities in case of scrutiny.
06 October 2014
since the vehicles belong to the firm and PSU is contracted with firm and not the partner, book the income in the firm's books and create a receivable entry against partner's current/capital account.
CAclubindia
