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Sales Tax dues converted to Misc. Income
One company following its accounting manual (not accounting policy) transferred old sales tax demands to miscellaneous income. However, it cannot submit the detailed analysis on the basis of which such adjustment was made. The manual,too, strictly stated that such conversion is to be considered judging the merit of each case. But as of now no such details were not furnished. What to do?
Replies (2)
Sales tax demands, if in any proceedings, held and decided in favour of assessee and the assessee has got the money back, can very well be deemed income of the assessee.
But if the dept. has made further reference to the higher authority wihout actually paying off the amt. to the him, then the asssessee can't deem it as his income.............
But if the case is still subject matter of an appeal, such can't be written off and credited to the accounts as such.!!!!!!!!!!!!
In this case, sales tax authorities have issued demand notice for such amount and yet to be paid or appealed by the Company. Instead of doing so, it has recognized the same as misc. income.
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