INCOME BY A FIRM HAVING DISCONTINUED BUSINESS

Sir,

Even though I am not quqlified, assuming your prior permission, suggestions can be usefull.

1. Firm had discontined business long back - Apply for PAN to file latest returns. [Interest income as ordered by hon'ble court should be in name of Firm]

2. Bifercate recovery of debt & interest amount out of total proceeds. Credit the related debtors a/c. and interest income a/c. as per the schedule descibed in hon'ble court order.

3. Change the method of accounting from accrual to cash basis and justify your descision with duration of case period governed by hon'ble court.

4. Partenrs had incurred expenses for litigation, than they have to produce the vouchers to get credit as an expense against interest income.

5. Debt recovery by partners is a part of business over all. Partners must aware of penalty and/or prosecution for non-filing of Tax Returns in case of default.

6. Keep intact all Court Papers as well as Firm records to defend under any circumstances from Tax authorities. [Naturally, partners should have kept all such documents under expectation to get back their assets with help of hon'ble court.]

Sir, I would like to know opinion too. Please.