there is a situation in which mr. x and Y entered in contract for purchase and sale of a building.
X is buyer and Y is seller. sale price is Rs.50 lacs and at the time of contract X paid advance of Rs.10 lacs .
later X could not pay the amount and breached the contract .
y then forfeited the amount . Now y shall deduct this 10 lac from the cost of acquisition at the time of sale later.
now my question is what will be the treatment of Rs.10 lac in the hands of X .?
whether he can debit this amount in P&L or what?
is there applicability of Travancore co. case?
CAclubindia
