Interest recd on F.D when production not start.
This query is : Resolved
28 December 2008
Dear Sir,
My company incorporated in 2005 and start production in 2006 . During thid period whichever expences made , that's capitalised . and that time we had F.D with Bank , on which we received interest . This interest we shown to " Pre - operative Exps ( interest ) under current asset. it's wrong or right . can I get any Case law against said transaction ?
Please help
Vijay
Dear Sir,
My company incorporated in 2005 and start production in 2006 . During thid period whichever expences made , that's capitalised . and that time we had F.D with Bank , on which we received interest . This interest we shown to " Pre - operative Exps ( interest ) under current asset. it's wrong or right . can I get any Case law against said transaction ?
Please help
Vijay
28 December 2008
It is wrong based on the following decisions:-
1) Tuticorin Alkaali Chemical and fertilizersltd Vs.CIT (1997)227 ITR 172(SC).
2) Vijaya Laxmi
sugar Mills ltd Vs CIT (1991) 191 ITR 641(SC).
Accordingly, the interest should be offered for taxation under the head income From Other Sources.
1) Tuticorin Alkaali Chemical and fertilizersltd Vs.CIT (1997)227 ITR 172(SC).
2) Vijaya Laxmi
sugar Mills ltd Vs CIT (1991) 191 ITR 641(SC).
Accordingly, the interest should be offered for taxation under the head income From Other Sources.
28 December 2008
INCOME TO BE DECLARED & OFFERED AS INCOME FROM OTHER SOURCES
CASE LAWS AS GIVEN BY LEARNED SENIOR CA CHAKRAPANI ARE THERE FOR YOUR REFERENCE
CHANDRAKANT AMBANI
BOMBAY
9819408963
9821240674
CASE LAWS AS GIVEN BY LEARNED SENIOR CA CHAKRAPANI ARE THERE FOR YOUR REFERENCE
CHANDRAKANT AMBANI
BOMBAY
9819408963
9821240674
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