21 March 2012
A person is having a liability of Rs. 3 Crores in Bank o/d in his books.The bank declared the same as a Non Performing Asset in its own book & agreed at a final settlement by clearing off the debt at a repayment of Rs. 1 Crore. What should be the accounting treatment in the books of the person & what should be the income tax obligation regarding the difference of Rs. 2 Crores ?????? Please try to clarify the said doubt with the help of necessary accounting entries.
CAclubindia
