Query

arey bt in above case wat will happnd???

It is better to make provision as per merchantile accounting system.

means???/

Provision is made for the payment of upcoming liablity which are not defined (assume). In your case you have already paid the advance tax in excess amount . it will treated as Current Assets and adjust next accounting year tax liablity.

you have to make provision for taxation for the tax liability on 31st march. Also on the same date Advance Tax would be standing in assets side of the balance sheet. In next year i.e. on 1st April when you will set off the amount of provision and Advance Tax the balance will stand as Refund of Income Tax.

Entry on 31st March

Profit & Loss A/c Dr.             100000

Cr. Provision for TAxation                     100000

Entry on 1st April

Provision for Taxation Dr.   100000

Refund of Income Tax Dr.     25000

Cr. Advance Income Tax                                       125000 

Its all what I think should be the accounting treatment.

Any corrections plz reply.

THANK YOU ALL

FOR U R VALUABLE RELPY

AND CAN PPL HELP ME K FOR WHOM 3CA IS APPLICABLE N FOR WHOM 3CB IS APPLICABLE I READ THE BARE AT BT CANT UNDESTAND PROPERLY

3CA is applicable to LTD companies and 3CB is applicable other than LTD Companies.

Whats full form of LTD?

3CA is for corporate assesee and 3CB is for non corporate assessee eligible for Tax Audit u/s 44AB

BT WAT ABT PVT N PUBLIC LTD COMPANIES????

PVT Ltd and Public ltd are corporate assessee

it is not compulsory but for accounting system it is better to make