One time settlement of loan
This query is : Resolved
16 October 2013
Sir
Inrespect of an assesee , the balance outstanding of a loan at the opening period of FY 2012-13 is 53 Lakhs and settled for Rs 40 Lakhs as OTS . This loan was under NPA catogory for bank and interest is provided by the assesee and disallowed under incometax computation. How the difference is to be accounted in the books and the treatment under income Tax
Inrespect of an assesee , the balance outstanding of a loan at the opening period of FY 2012-13 is 53 Lakhs and settled for Rs 40 Lakhs as OTS . This loan was under NPA catogory for bank and interest is provided by the assesee and disallowed under incometax computation. How the difference is to be accounted in the books and the treatment under income Tax
16 October 2013
If the expense was disallowed earlier, it cannot be added back to income now.
In accounts, you may transfer the balance to capital reserves.
In accounts, you may transfer the balance to capital reserves.
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