We exported machinery in 2015-16 vide single invoice worth Rs. 20 lacs. Customer paid 12 lacs in 2016-17 against this bill. Customer has informed us in writing that balance Rs. 8 lacs will not be paid because of the goods exported was not fully technically compliant and they had to incur some more alteration charges to bring it in workable condition.
How to write off this unrealized Rs. 8 lacs in 2020-21?
Total export proceeds received in previous calendar year is RS. 2 crores
Considering RBI guideline of self write off @ 5% of total export proceeds received in previous calendar year, it appears that upto Rs. 10 lacs ( Rs. 2 crore x 5%) can be written off in 2020-21.
Therefore can we write off Rs. 8 lacs in 2020-21? Please suggest..
CAclubindia
