Increase in authorised capital

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CA. Jyoti Baid (Querist)
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14 December 2009 Sir,

A company has increased the authorised share capital and has paid ROC fees as Rs.80,000/-.

What will be the accounting treatment of this expense.

Regards,
Jyoti

Ankur Garg

Ankur Garg (Expert)
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14 December 2009 Hi,

Fees paid to the RoC for increase in authorised capital is a capital expenditure not deductible u/s 37(1) but deductible u/s 35D.

Citation:-

1. Punjab State Industrial Development Corporation Ltd 225 ITR 792 (Sc).

2. Mohan Meakin Breweries Ltd 117 ITR 501 (HP)- says that Fees paid for increase of authorised capital is an inadmissable expenses.

Regards

CA. Jyoti Baid

CA. Jyoti Baid (Querist)
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15 December 2009 Hello
Thanks for the reply.
How is the expenditure incurred for increase in authorised capital of an existing company deductible under section 35D.
Section 35D allows expenditure on issue of shares.

Regards
Jyoti

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