if a provision made on 31st march 2009 is in excess, hence we write it back in the current year (FY 09-10) and consider it as income of the current yr...
my question is - Is this be called as a prior period income or not ??
Harsh shah (Final CA Student) (50 Points)
26 May 2010if a provision made on 31st march 2009 is in excess, hence we write it back in the current year (FY 09-10) and consider it as income of the current yr...
my question is - Is this be called as a prior period income or not ??
Ca Aashish Upadhyay
(CONSULTANTS)
(913 Points)
Replied 26 May 2010
Dear Harsh!
If the provision is made out of the P&L Appropriation account than it will only have a positive effect on the P&L Account Balance. However if the provision is above the line item than certainly that Income be treated as Income of the previous year written back. and pay tax accordingly .
Please see also deemed income section!
CA Shiv
(Business Controller)
(2987 Points)
Replied 26 May 2010
welll, it is not treated as prior period income, but it is deemed income in current year..... so have to pay tax in the current year.....
harish sharma
(student)
(58 Points)
Replied 26 May 2010
dear
since provisions are appropriation of income and tax is chargable on income and not on profits remains after appropriation
hence when a sum is not deducted while computing taxable income its subsequent recovery/credit to p&l
will not attract tax liability.
but when a provision aloowed as deduction its subsequent recovery or remission or sucession will attract tax liability as given u/s 41(1) and 36(1)(viia)
GSTR 9 and 9C for FY 23-24 as amended by Notification 12/2024 dated 10th July 2024(with recording)
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