excess liability

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This query is : Resolved

Vivekag (Querist)

19 June 2007 i have a creditors which not claim his amount last 5 years so his liability written back & shown my income. now he come my office & demand his money. what can i treat this situation in my books ?

Shashi Mohan Jha

Shashi Mohan Jha (Expert)

19 June 2007 you must have to provide in the books as only connotation that a liability is 5 years old doesn`t support for writting it off.
Only one exception would be in a case where your creditor vannot claim their amount in persuant to any law/regulations

Thanks a lot

Jitender

Jitender (Expert)

26 June 2007 u need to consider the Limlitation act

Sanjeev Kumar Varshney

Sanjeev Kumar Varshney (Expert)

09 July 2007 If the creditor has not sent any letter demanding his credit balance since last 3 years and you have also not confirm his credit balance anytime within 3 years, then he cannot claim it through Court of Law. If he is demanding continuously and you are not paying due to any reason then the situation will be different and you have to pay.

CA Mani

CA Mani (Expert)

01 August 2007 Yes, Sanjeev is right.

If there is no communication regarding Such amount during last 3 years, He cannot demand legally.

But You have to pay amount If he proves that he is demanding you and you are not paying. ( Any time during last/continuos 3 years).

I hope It'll be sufficient to solve your query.

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