Clause (a) of section 43b of income tax act
This query is : Resolved
24 August 2011
In F/Y 2010-11 a newly imposed cess has been account for by debiting the P&L a/c and crediting the liability and same is disallowed in f/Y 2010-11 as not deposit till the due date of filling of ROI. But after filling of ROI for the F/Y 2010-11, the above said cess become not payable to us. In this situation if we reverse the liability in F/Y 2011-12 (which was created in F/Y 2010-11and disallowed in f/Y 2010-11), then whether, reversal of above said liability in F/Y 2011-12 will attract any tax.
24 August 2011
In AY 2012-13
There will be no tax liability due to set off in computation of Total Income.
.
FY 2011-12
The discontinued liability will be debited to Cess Payable-Liability A/c
and correspondingly credited in P&L A/c
as Cess A/c (Income).
Net Profit will be 10000 Profit +200 Cess.
=10200
Less: Cess Paid( W/off) U/s 43B 200
It will be reduced by the amount of cess
as if paid U/s 43B.
There will be no tax liability due to set off in computation of Total Income.
.
FY 2011-12
The discontinued liability will be debited to Cess Payable-Liability A/c
and correspondingly credited in P&L A/c
as Cess A/c (Income).
Net Profit will be 10000 Profit +200 Cess.
=10200
Less: Cess Paid( W/off) U/s 43B 200
It will be reduced by the amount of cess
as if paid U/s 43B.
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25 August 2011
Sir, Thanks a lot to resolve the above problem and kindly tell me is there any difference if question is "In F/Y 2010-11 a newly imposed cess has been account for by debiting the P&L a/c and crediting the liability and same is disallowed in f/Y 2010-11 as not deposit till the due date of filling of ROI. But after filling of ROI for the F/Y 2010-11, the above said cess become not payable to us. In this situation if we reverse the liability in F/Y 2011-12 (which was created in F/Y 2010-11and disallowed in f/Y 2010-11), then whether, reversal of above said liability in F/Y 2011-12 will attract any tax."
25 August 2011
Since it was not deposited , it has not been claimed as an expense in the return of AY 2011-12. In return the said item has been shown as Item disallowed and such tax has been duly paid without considering the expense.
So later on it will not be considered as Income .
Since it was not deposited , it has not been claimed as an expense in the return of AY 2011-12. In return the said item has been shown as Item disallowed and such tax has been duly paid without considering the expense.
So later on it will not be considered as Income .
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