GST inspection and IT problem

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Prop
106 Points Posted on 21 January 2020
a client paid 13.5 tax and 13.5 penalty towards excess stock found when it's inspected by gst enf officials

now how to enter it in books and what is the tax liability under IT ?
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On 21 January 2020 at 14:55 Report
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A client faced a GST inspection resulting in a 13.5% tax and penalty on excess stock. This discussion explores how to record these payments in the company's books and determine the associated income tax liability. It suggests treating the paid tax and penalty as an asset if reflected in the GST cash ledger, to be written off against future liabilities.

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Studwnt
1141 Points Posted on 25 January 2020
13.5 paid as penalty will be disallowed expenditure.
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On 25 January 2020 at 15:59
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C.A FINAL STUDENT AND QUALIFIED C.M.A
563 Points Posted on 25 January 2020

Both tax and penalty will be reflected in your Cash Ledger in respective heads at G.S.T Site and you can also utilize them later.Hence it would be better to recognize them as an asset in your books (If it is reflected in your cash ledger) and write off against the liability when you utilize it.

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On 25 January 2020 at 16:55

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