Money given as share applcn money whether inv

SkDash (CS (Member) CWA (Final))   (909 Points)

17 August 2011  

One of our Company has given some money to another private company as 'share application money' and it is there with them for around 2-3 yrs. Now my question is that- what the lending company should show in its balance sheet ? Can it be shown as investment or as Loans and Advance ? it is being shown as Investment for the last years and as per me-its wrong. If shares are not allotted against such money, it cant be shown as investment and also register of investment u/s 49 is not required to maintain for such amount.

Am i right friends ? Pl supplement.