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Cc processing charges before commencement of business
A company incurred 12 lakhs as processing charges on Cash Credit loan before commencement of business. Where will he show this in the Balance Sheet and how can he claim the amount as deduction in his Profit and Loss Account after the business has started?
Replies (1)
Hi..
The expenses incurred before commencement of the business is allowable in section 35 AD of I.T.Act. This section defines the criteria used for find out the preliminary expenses and i dont think so this CC processing charges covered under any criteria.
So, i think the said expeneses is not allowable as deduction in I.T.Act.
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