Abc company purchased raw material from wbc co . Wbc Co. purchased the material from reliance inds and sells the material while in transit to M/s Abc co.
Now Abc co is directly making payment to Reliance and Invoicing the bills of Reliance instead of invoicing the bills from Wbc Co.
The queries are:-
1. Whether there is any objection in such kind of payment directly to reliance.
2. Whether the mode of booking the bills is appropriate?
3. Wbc co. books the sale when it invoices to Abc co. and books the payment in the account of Abc co. when the payment is made to reliance by Abc co. .
It raises a Doubt but the Abc co. says they are doing such practice since 2005 and there has been no problem either from auditor or from any of the parties involved.
Kindly raise and quote your objections in such transactions
CAclubindia
