18 September 2014
its a practical question FA opening value is 90625.26 addition on 14/08/2013 is RS.20000 and a claim received on 19/03/2014 Rs.200400
how to show these transactions in statements& its income tax application??
18 September 2014
As per section 45(1A) of Income Tax Act,1961, any amount received as insurance claim will be treated as consideration for destroyed/lost/damaged asset in the year in which such money was received. So, for Income tax purpose, you need to deduct the claim amount from WDV of the block and book CG/CL.
For accounting purpose it will be deducted from WDV of an asset an Gain/loss will be shown in "statement for profit and loss" under extraordinary items
CAclubindia
