Fundamental query
This query is : Resolved
21 July 2013
Is capital receipt taxable?
A ltd recd MONETARY PENALTY by its supplier as the supplier had not completed the construction of its PLANT/Factory and their initial contract stated that in case constrction is not completed by particular date, 10 lakh rupees wud hav to be paid. Such damages are thus CAPITAL RECEIPTS in the hand of A Ltd. How will this be taxed? In cap gains or other income? or not taxed at all being a CAPITAL RECEIPT????
A ltd recd MONETARY PENALTY by its supplier as the supplier had not completed the construction of its PLANT/Factory and their initial contract stated that in case constrction is not completed by particular date, 10 lakh rupees wud hav to be paid. Such damages are thus CAPITAL RECEIPTS in the hand of A Ltd. How will this be taxed? In cap gains or other income? or not taxed at all being a CAPITAL RECEIPT????
21 July 2013
The receipt can not be treated as capital gain as there is no transfer of capital asset.
.
The valuation of the WIP or Capital Asset has to be adjusted by Rs. 10.00 lac.
.
.
The valuation of the WIP or Capital Asset has to be adjusted by Rs. 10.00 lac.
.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Reopen of assessment proceeding
- Depreciation of fixed assets- coop housing society in mumbai
- TDS on Consultancy- Non DTAA
- Foreign lottery ticket bought online from India: legality, tax and consequences
- Rental income gst and it purpose
- EXPORT BILL UNDER LUT FREIGHT CHARGE INCLUED IN INVOICE IT LIABLE TO TAX
- COMMERCIAL INVOICE FOR MATERIAL AND FREIGHT
- Experts need help
- Tax Audit u/s 44AB for Transport Business A proprietorship is engaged in transportation business and
- Reprocessing of rectification order AY 2025-26
- Putting a heading on received mail
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- STATUTORY AUDIT OF A SMALL PRIVATE COMPANY INCORPORATED ON 28.03.2025
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
- Resigning a auditor from the company for misconduct
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
