21 July 2008
Can any body help me out for the following:
'A' is the Private Company has got Sub Contract for some work from the Main Contractor 'B".
For Executing the work The Main Contractor supplied some Plant & Machinery which is Purchased by the Main Contractor.
After Completion of the Work( Say after 5 years) all the Plant & Machinery will become the Subcontractor's (i.e A) Assets, for this The Main Contractor Deducting Principal and Interest amounts from the Running bills raised by the Subcontractor.
here are some observations:-
1). The Invoices of the Plant & Machinery which is supplied by the Main Contractor still in the name of the Main Contractor.
2). The Ownership of the Assets also not transferred
My query is :-
What is the Accountability treatment of Principal and Interest Payments and what about the applicability of the Depreciation.
Whether any TDS will Applicable for the above transactions.
CAclubindia
