02 February 2009
A Company received Rs. 1 Crore as compentation for cancelling a Sale Agreement pertaining to acquisition of land. Is that receipt of Rs. 1 Crore to be shwon as revenue in the P/ L account or can it be treated as deferred income and taken to the P/ L Account for a period of next 4 years commencing from A. Y. 2008- 2009. What are the Tax implications and is there any Tax Rebate available for that?
Please note that the property was never acquired by the Company, hence, there was no transfer of Capital Assets and Sec. 51 is is not applicable.
CAclubindia
