Transfer of fa to stock

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

11 August 2014 State Govt.Department had deducted TDS from my bills.But they are neither issuing me TDS certificate nor they have filed TDS Return inspite of my many letters and reminders. What should I do ?

Parul Gupta

Parul Gupta (Querist)
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11 August 2014 A co has decided to transfer a Fixed Asset to stock during the mid of the year. Eg. Purchase price 3 yrs back was Rs.100. Dep charged till 31-3-12 Rs.50.
Asset to be transferred on 1-10-13. Dep till 30-6-13 is Rs.5. So asset value on date of transfer is Rs.45. At what value the transfer should take place?? And what will be tax implications??

Rupesh Jain

Rupesh Jain (Expert)
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11 August 2014 formtfr of assets in stock a per section 45(2) you have to take the current market value of assets on date of tfr and later when you sell the assets then diff of assets of value on tfr and book value will taxable as capital gain and sell as stock will be taxable as business income.

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Parul Gupta

Parul Gupta (Querist)
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11 August 2014 But what will be the accounting entry to be passed in the yr of transfer?? I mean how to account for the profit at time of conversion of asset??

Rupesh Jain

Rupesh Jain (Expert)
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11 August 2014 entry with market value of assets

purchases a/c Dr.
to fixed assets a/c
to unrealized capital gain on tfr of assets

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Nikhil Kaushik

Nikhil Kaushik (Expert)
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13 August 2014 file the return and claim the tds credit therein. It is natural that it will be disallowed, at that point of time, submit the documentary proof to provide evidence of TDS deduction to the AO. The AO shall have to give you the credit.

Rupesh Jain

Rupesh Jain (Expert)
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13 August 2014 for tds deduction not not issue the certificate then you can write complain to senior officer for this