21 February 2008
urban cooperative bank has invested funds as fixed deposit in other coperative bank. it has invested with a condition that at the time of maturity the interest will be added to principal amount & again will be reinvested.what will be the treatment of interest accrued for the financial year 2006-07? will it not be claimed u/s 80p from the profit of the bank as income derived by the cooperative society from investment made in other cooperative society?
21 February 2008
you will treat accrual income in you a/c and interes is credited in your p&l a/c if amount is deposited in other bank and iterest is receive it is exempted u/s 80p of the act or when you receveied interest on receipt basis you credit interest in p&l a/c it is also exemted from tax
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