Sez units tax audit

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Shaik shah (Querist)

17 October 2015 I new unit established in SEZ units has capitalized during the financial year 2014-2015 and it has made export sales during the year to which transfer pricing provisions will apply and the same were credited to pre operative expenses and the income from revenue during the financial year 14-15 is NIL.

Is tax audit 44AB applicable for AY 15-16? if yes suggest me in brief.

if there are no sales transfer pricing provisions will apply?

Amol S Joglekar

Amol S Joglekar (Expert)

17 October 2015 "transaction" includes an arrangement, understanding or action in concert.

In your case, you are writing that "it has made export sales during the year to which transfer pricing provisions will apply and same were credited to pre operative expenses"... What do you mean by that?

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Shaik shah

Shaik shah (Querist)

17 October 2015 The company has incurred the preoperative expenses till the date of capitalisation. The company while capitalisation of Fixed assets they have reduced the preoperative expenses by debiting the sales account for the sales made till that period and crediting the preoperative accounts and the effect of such adjustment leads to NIL turnover during the financial year.

Amol S Joglekar

Amol S Joglekar (Expert)

21 October 2015 This entry of debiting sales and crediting preoprative expenses is OUT of my syllabus. Sorry!

even I am NOT able to digest the vocabulary used by you..."DATE of CAPITALISATION"

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