sanjay singhal (CA) (987 Points)
11 November 2010HI everbody,
A company incorporated on 25th feb 2009 wants to choose first financial year upto 31st march 2010 as per companies act. What care should be taken ?
It dosent come in tax audit perview. How it should prepare it financial statements for income tax purpose for the year ended 31st march 2010 & 2010-11.
thanks
Yogesh Shah
(Managing Corporate Finance)
(1051 Points)
Replied 11 November 2010
Hi Mr. Sanjay,
Period of Accounts of said company from 25.02.2009 to 31.03.2010 (as per Companies Act) is OK.
Special care is required to be taken because Financial Years under both the Acts is different.
For the purpose of Co. Act, you have to draft only ONE balance sheet i.e. Balance Sheet as on 31.03.2010 (covering the period of 25.02.2009 to 31.03.2010). Same for other accounts i.e. P&L A/c. etc.
In respect of Income Tax Act, you have to prepare two Balance Sheets viz.
First - Balance Sheet as on 31.03.2009 (on that basis you will file the ITR) and second - Balance Sheet as on 31.03.2010 (on this basis, you will file second ITR of Company)
Actually, I have gone through this procedure. There is one public co. in POONA where I have personally handled this type of matter. In that co. incorporation date was 16.12.2007. Hence, as per Co. Act they made first balance sheet as on 30.06.2008 but for IT act, they made another balance sheet as on 31.03.2008. For second year, as per Co Act they made balance sheet as on 31.03.2009 (period 01.07.2008 to 31.03.2009) and for IT act, they made normal one year balance sheet.
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