Revenue or capital expense
This query is : Resolved
17 December 2014
My query is,trust wants to create gau rakshan (Place where cows are kept) (it includes construction of compound wall and other facilities for cows ),for funding this project trust issues lottery and collects Rs 11 Lakhs from sell of lottery tickets and distributes prizes to the lottery winners of Rs 5 Lakhs. so i want to ask whether this income and expenditure on behalf of lottery tickets for construction is to be treated as revenue expense or capital expenses..
Amol S Joglekar
(Expert)
17 December 2014
The lottery is a revenue activity.
The compound wall is a Capital expenditure.
The compound wall is a Capital expenditure.
Message likes :
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17 December 2014
but what about substance over the form..lottery was issued only for constructing compound wall???
Amol S Joglekar
(Expert)
18 December 2014
The revenue acticity intended to be done for the cause of OR for the purpose of building CAPITAL activity CAN NOT BE TREATED AS capital ACTICITY.
I fail to understand what SUBSTANCE you find in this OVER the form.
Your views please.
I fail to understand what SUBSTANCE you find in this OVER the form.
Your views please.
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