Tax liability: partnership firm converted into pvt. ltd. co.

This query is : Resolved

Rahul Agarwal (Querist)
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24 September 2012 A Partner ship firm was converted in to Pvt. Ltd. Co. on 04.04.2011with its all assets and liabilities and the partnership firm was discontinued on that date.

The firm was having Rs. 30,00,000 as Income Tax provision for F.Y.. 2010-11 which was carried in the opening balance sheet of Pvt. Ltd. But the actual tax liability for F.Y. 10-11 comes to 41,00,000. which was paid by Pvt. ltd co. out of which 30,00,000 was adjusted through provision a/c.

Now, 1)how the Remaning 11,00,000 should be treated in the books of Pvt. ltd.co. 2)Whether that will be charged to P&L a/c in F.Y. 11-12. of the Pvt. Ltd. as the same was paid by them. 3) Whether that amount will be allowable under I.Tax act for F.Y. 11-12. or what else will be the treatment of the same.

Please give your opinion . Thanks in advance.