BILL OF LADING, PROVISIONAL WAREHOUSE BILL OF ENTRY AND COMMERCIAL INVOCIE DECLARE THE QTY AS 100MT.THE SURVEYOR CONFIRMS THE SAME OR CONFIRMS THE SHORT.AFTER FINAL TAKE OUT FROM THE WAREHOUSE IT IS FOUND THAT THE QTY. WAS 105MT.THE CUSTOMS CLEAR THE EXTRA MATERIAL ON PAYMENT OF DUTY AND FINE . HOW THIS ENTRY WILL BE TREATED IN OUR BOOKS OF ACCOUNTS AND EXCISE.
Update inventory records accordingly and as far as accounts are concerned it will shown as a fine/penalty. In notes to the accounts you can provide the appropriate explanation for procedure followed. I don't think it should be inappropriate to show this in trading account either (for your Final Accounts)
IF THE EXCESS QTY. IS REC. IN FACTORY AND PROCESS DOWN FOR SALE , IT WILL EFFECT THE MANUFATURING ACCOUNT ON SALE SIDE. THEN IN THIS CASE ONLY QUANTITATIVE EFFECT WILL DONE IN THE BOOKS FOR PURCHASE. ONLY DUTY FIGURE ( VALUE) WILL BE REFLECTED FOR THE QTY. IN BOOKS.
ON TALLY 7.2 , HOW WILL THE QTY. ENTERED WITHOUT VALUE? - PLZ SUGGEST
SHALL WE HAVE TO GIVE A NOTES ON ACCOUNT FOR THIS. REGARDING FINE THAT IS CLEAR IT IS REPORTING ITEM
Quantity without value can be entered if you select "allow zero value items" as "yes" - to be entered using Configure F11/F12.
In the "Notes to Accounts" CIF Value of Imports is disclosed also foreign exchange items are disclosed. Additionally the Qty and Value are disclosed as per additional information in Part II of Schedule VI. Such disclosure will bring out the fact that you have incurred penalty.
In the Profit and Loss Account you would create an Account Head "Fees, Fines & Penalties" (for eg.) and you would provide break up in the schedules this should be sufficient compliance.
If importer is of indian origin and Mr. X has purchased from him on HIGHSEAS Basis , Case - I - Mr. X is paying in INR to impoter / Case - II Mr. X is paying directly to foreign seller in USD or other currency. Your view on the treatment in" notes of accounts" for both the cases is appreciated .
others :
1. In case II - If Mr. X was to give the importer Rs. 5500 INR on invoice ( purchase price of importer was USD$ 10 - INR 5000 CIF at certain exchange rate + 500 comm. ) . At the time of payment ( without having LIBOR fixation ) in consideration for 10 USD Mr. X has to pay 5500 INR. Is any money payable to impoter now.
2. If expenditure on money transfer in case is borne by Mr. X , can the expenses will be allowed in his books.
CAclubindia
