19 April 2010
A company has paid interest on income tax for AY 2007-08 in FY 2009-10. The said fate of such expenditure is absolutely made clear u/s section 37(1) of the Income Tax Act, 1961. But my question here is should the interest be taken into account to calculate profits for the year as per Companies Act, 1956 or routed thru Reserves & Surplus??? In other words, is the said interest, above the line item or below the line item.???? Is there any distinction between income tax & interest on income tax for calculating profits as per Companies Act, 1956???? Comments, suggestions & debates invited.
20 April 2010
Can you pls affirm in simple words that while calculating profit as per companies act, interest on income tax should not be considered & it should be accounted thru Reserves??
CAclubindia
