dissolution of partnership firm

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Querist : Anonymous

Querist : Anonymous (Querist)

25 May 2011 sir i want to know how to present the final accounts of partnership firm which is dissolved in f.y. 2010-11. whether realisation account etc are also to be presented in the tax audit report ?
plz reply as early as possible.

Amol Gopal Kabra (CA,CS,DISA)

Amol Gopal Kabra (CA,CS,DISA) (Expert)
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25 May 2011 No. There is no need to present the realisation account in the tax audit report.

Message likes : 2 times

Querist : Anonymous

Querist : Anonymous (Querist)

25 May 2011 sir upto which date we have to show the balance sheet on the date of dissolution or 31.03.2011.

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Querist : Anonymous

Querist : Anonymous (Querist)

25 May 2011 i also want to know whether the firm should charge depreciation on fixed assets or not ? In case, it can charge then upto which date it should charge depreciation either upto the date of dissolution or 31.03.2011 ? plz give reasons too.

THANKS IN ADVANCE

Amol Gopal Kabra (CA,CS,DISA)

Amol Gopal Kabra (CA,CS,DISA) (Expert)
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26 May 2011 The balance sheet should be upto the date of dissolution. Further, depreciation wont be allowed under Income Tax Act, as no depreciation is allowable for in the year of disposal of asset. But there is no harm in charging depreciation in books of accounts. Only the thing is that, it will be disallowed in the return of income. Also make sure that, you inform the department separately about the dissolution of the firm. Else you may receive notice regarding non-filing or returns in future years.