CA lakshmikanth (Chartered Accountant) (238 Points)
14 September 2009if increseing authorised share capital it has incurred rates and taxes Rs 300000 its is treated as preliminery expenses and write off 5 years or treated as expenditure ?
CA CS Amit Borade
(Chief Accountant)
(2828 Points)
Replied 14 September 2009
Hi
Rates & Taxes incurred at the time of Increase in authorised capital is Revenu in nature so it should be expesed out in the year in which it is incurred.
Preliminary expenses are thoses Expeses which are incurred at the time of incorporation of comapny.
Thanks
Ankur Garg
(Company Secretary and Compliance Officer)
(114778 Points)
Replied 14 September 2009
Hi,
Fees paid to the RoC for increase in authorised capital is a capital expenditure not deductible u/s 37(1) but deductible u/s 35D.
Citation:-
1.
2. Mohan Meakin Breweries Ltd 117 ITR 501 (HP)- says that Fees paid for increase of authorised capital is an inadmissable expenses.
Regards
CA CS Amit Borade
(Chief Accountant)
(2828 Points)
Replied 14 September 2009
Thanks Ankur for correcting me.
Please clerify that It will be treated as Preliminary Expenses in accounting as per companies Act also.
deepika mohanty
(artical)
(43 Points)
Replied 14 September 2009
It will be treated as Preliminary Expenses as per companies act,1956 hamare sir ne bola tha
Pulkit Agarwal
(CA. Final)
(455 Points)
Replied 14 September 2009
CA Harish Suwalka
(Chartered Accountant ( Bhilwara ))
(4125 Points)
Replied 15 September 2009
these expences will be treated as preliminary according to Companies act and IT act 1961
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