Tax treatment for depb licence sales & receivale incomes

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sushil (Querist)
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28 September 2011 Dear Experts,

Our is a pvt ltd company. our major revenue comes from export sales. we receives DEPB License as incentives.

We claims for DEPB licence to govt authority in the year of sale.
some times we receives the DEPB in the same year, and balance o/s receivables we shows it as current assets as under the head incentives receivables by crediting incentives incomes.

Whenever we are in need of funds we sales the actual DEPB License available with us.

Total Depb Licence received for the year & receivable for the year we offers for tax by showing other incomes.

and actual Depb license remain in t hand we shows as stock.

We are not giving any other effects for the above transactions while computing the tax liability.

Is these treatments are as per provisions of IT Act?

Waiting for expert opinion

Thanks in advance..
Regards,
Sushil.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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29 September 2011 Mr Sushil,
Just watch out! They are taxable under VAT Act also at general rate,say 14%.
MJK

Aditya Gopinath V

Aditya Gopinath V (Expert)
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01 October 2011 Under the charging sectionPROFITS AND FROM BUSINESS OR PROFESSION profit fron sale of DEPB had to be down as business income not other income

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