BHALCHANDRA (PARTNER) (28 Points)
12 April 2012Whether the expenses incurred on increase in authorised capital of company be debited to P & L A/C in the year of incurring the expenses or the same should be defrred & written off over a period of 5 years?
CA D R P
(Chartered Accountant)
(313 Points)
Replied 12 April 2012
YOU CAN DEBIT TO P&L ACCOUNT IF AMOUNT IS NEGLIGIBLE COMPARED TO OTHER EXPENDITURES.....
Akhilesh Kapadia
(Employee)
(106 Points)
Replied 12 April 2012
mahak katyal
(a)
(135 Points)
Replied 22 April 2012
these are deferred expenditure,,shown under Misc expr..
As per IT Act, the amount cant be amortized as this expr is not allowed
mahak katyal
(a)
(135 Points)
Replied 02 May 2012
i can substantiate it :
CAse Law: Punjab state industral developement corporation ltd(supreme court) 1997
the fee paid to ROC for expansion of authourized capital of the company is directly related to the capital expenditure incurred by the company and although incidentally that would certainly help in the business of the company and also in profit making,but still it retans the nature of capital expenditure since the expr was directly related to the expansion of the capital base of the company
hence the aount paid to ROC as filing fee for enhancement of capital,is not a revenue expr and is not deductible.
Mitesh Chheda
(Practise)
(31 Points)
Replied 06 June 2018
Whether it can be directly set off from the reserves or should it be amortised in 5 installment as per Account, though it may be disallowed in IT ?
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