A company whose principal business is purcahse and renting of properties has not generated any income in this year. But the general office, legal, preliminary exps w/off are debited to P/L amounting to Rs. 66000/-
Now the company earns speculation income by way of commodity difference amt to Rs.56000/- and interest on loan of Rs. 15000/-.
Which is the correct option: 1.Take the deduction of all expenses from speculation income,then speculation loss will be (66000-56000)10000/- which cannot be st off against int. on loan. Hence Total income - 15000 2.Show the loss from business as Rs.66000/- which could be set off with int on loan and Rs.56000 as speculation income. Total income-5000
03 June 2009
In the given case u have to follow second option only .Position would be as follows-
1. Income u/s PGBP Normal- (66000) Speculative- 56000 2. Income u/s Other Sources-15000
Loss u/h PGBP after intra head ad. – 10000 Income after inter head adjustment- 15000-10000=5000- Total Income
As u said u can not follow first option becaz –
1- For the purpose of computation Normal Business and Speculative is diff. frm each other 2- No expenses can be claimed against the income of Speculative business.
CAclubindia
