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Substance over form

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(Querist)
09 February 2017 Any one plz explain the exact meaning and example of substance over form
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CA Amrita Chattopadhyay

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CA Amrita Chattopadhyay (Expert)
09 February 2017 The concept of substance over form is applicable when as per the law, it may appear to be certain type of transaction but when you practically look at it, it may appear to be something else.
For example, as per AS -19 you find that the person is paying rent for certain capital asset for a small period so it appears to be operating lease and thus to be considered as revenue. But it you go through the agreement and read all the clauses carefully, you will find that lessee has all the rights over the asset which gives it a nature of finance lease thus have to be capitalized.
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