Where to post entry for fee paid to advocate

it should be treated as expense

it should be posted as "legal expenses", and deducted from income in current year. 

however in year of recovery it will make gain and would get added to income.

CAn anyone clear  , . I am a bit confused,

thanx
 

it means now when you r spending the amount it will be treated as expense

in the year in which you will received the compensation that compensation will be taxable

Agree with U.S. Sharma..............Just read definiton of Asset.............and evaluate yourself.......

I am not concerned for the compensation/fine to be provided by court. But the amount already paid for the initiation of legal proceeding. and it is already paid to lawyer, Cooperative society already informed the defaulter member regarding  that legal fee by regd. ad. , so it is clear to defaulter  that he will be charged the legal fee.

and the case is not in dispute it is something like recovery process suit.

moreover, what is the way to take the fee amount into member's liability and asset of society , so that society will not face loss due to necessary litigation charges incurred by it.

please explain .

thanx

debit the defaulting party - it will stand as debtors

credit the legal fees and expenses 

this will neutralize the P/L account and the whole such expenses would get receivable from the defaulter.