Treatement of receipts in consulting & r & d business

This query is : Resolved

Jitndr (Querist)
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29 December 2011 X Pvt Ltd is in the business/profession of providing consultancy in the field of civil construction. One of the clients has paid them, say Rs.10 Lakhs, in Decemeber 2011 for doing practical research on certain construction method. The research/contract would run upto 3 years.

Queries:-
1. What would be the accounting treatment of receipt and subsequent expenses in the three years.
2. what would be the tax treatment of the same. Please give relevant sections.

Thanks in Advance.

Jitndr

Jitndr (Querist)
Follow

29 December 2011 X Pvt Ltd is in the business/profession of providing consultancy in the field of civil construction. One of the clients has paid them, say 10 Lakhs, in Decemeber 2011 for doing practical research on certain construction method. The research/contract would run upto 3 years.

Queries:-
1. What would be the accounting treatment of receipt and subsequent expenses in the three years.
2. what would be the tax treatment of the same. Please give relevant sections.

Thanks in Advance.