PROVISION FOR BONUS

This query is : Resolved

P.S.VISHWANATHAN

P.S.VISHWANATHAN (Querist)
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24 September 2008 IN THE PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31.03.2008, WE HAD MADE A PROVISION FOR BONUS UNDER PAYMENT OF BONUS ACT. THIS PAYMENT WAS NOT DISBURSED AT THE TIME OF SUBMITTING OUR RETURN WITH THE INCOME TAX DEPARTMENT.

THIS AMOUNT WAS THEREFORE,DISALLOWED BY OUR AUDITOR UNDER SECTION 43 B.

MY QUERY IS WHETHER IN THE LIGHT OF BONUS ACT WHICH STIPULATES THAT BONUS SHOULD PAID WITHIN EIGHT MONTHS OF THE END OF THE FINANCIAL YEAR (IE.BY 30.11.2008) IS THERE NOT A CASE FOR ADDRESSING THIS ANOMOLY?

P.S.VISHWANATHAN

P.S.VISHWANATHAN (Querist)
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24 September 2008 OPEN

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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24 September 2008 You can claim the bonus amount on actual payment thereof only, notwithstanding the time-limit given under bonus Act.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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24 September 2008 Seems Sri Srinivasaraghavan's view is correct.

Ravikumar.G

Ravikumar.G (Expert)
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24 September 2008 Payment basis you can claim during that year.

Guest

Guest (Expert)

25 September 2008 Above views are correct and normally bonus is paid every year whether it is on diwali or on end of F.Y. as per the policy of the company.

Further auditor is just reporting that the bonus provided in the accounts has not been paid upto the date of audit report only and it does not report that it has not been paid at all in contravention of the bonus act.

Rohit

SANDEEP AGGARWAL

SANDEEP AGGARWAL (Expert)
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25 September 2008 Bonus is allowable during current year instead of previous year because it was not paid before due date of filing return. Seens to be ok because just provision basis deptt. can not allow bonous. Actual Bonous amount nay be more or less.

Regards
Sandeep Aggarwal

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