Income tax paid (so refund) is not income, and interest received over that is taxable.........
Refund is a taxed income and cannot be retaxed.
We pay taxes from our income only. If it is excess then it is refunded. So IT refund is part of income. Thats what i said.
Only intrest part is added to P& L account and is assessed under 'Income from other sources'... while basic refund amount is directly credited to capital account.......
Credited to tax provisions account......
CAclubindia
