Pooja Nahar

Assessment of Political Parties

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As per sec. 13A of Income Tax Act, 1961 means a political party registered under section 29A of the Representative of the People Act, 1951.

Political Parties Income :- 1. House Property 2. Capital gains 3. Other resources 4. Voluntary contribution. It is exempt under section 13A.

Conditions :-

  1. maintenance of Books of account & other documents.
  2. record of voluntary contribution in excess of Rs. 20000 (change as per Finance Act(report to E.C)).
  3. audit of books of account.
  4. limit of cash donation upto Rs. 2000 (change as per Finance Act).
  5. donation >Rs. 2000 through A/c payee cheque/bank draft/bank ECS/bank A/c/electronic modes.
  6. return of income within due date under section 139 (4B).

What is Discontinued Business

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Assessment means determination/computation of total income and tax liablity.

Discontinued business :- complete cessation of business. ex. firm’s dissolution(discontinued).

another example: Suppose Mr. Ram has business contains 3 units i.e. X,Y & Z. Out of these 3 units, one unit X is giving loss. Therefore ram has decided to drop the business of unit X, this is not called discontinuance of business. on the other hand, in case of joint family’s business if there is division/partition. This is case of discontinuance.

In case of Professions:– ABC firm having 3 partners i.e. A, B & C. Merely suspend practice is not called discontinuance as partners may remain in profession. It is largely depends upon the state of mind- an advocate discontinue his profession when he is appointed as judge, although aftre retirement he may resume his practice.

Financial Reporting & Financial Statements

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Financial Reporting: – means presentation of financial Statements to stakeholders and public.

Financial Statements-mainly Statement of P&L/Profit & loss A/c and Balance Sheet.

Financial Elements: – 1. income and expenses. 2. assets, liabilities and equity

Note: financial information is provided in the statement of balance sheet to recognise assets, liabilities and equity and in the profit and loss to recognise income and expenses.

& in other statements & notes.

GST on Liquidity Damages, Penalty and Compensation arising out of breach of contract or other provisions of law.

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As per the CBIC vide Circular No. 178/10/2022-GST dated August 03, 2022 regarding GST applicability on liquidated damages, compensation and penalty arising out of breach of contract or other provisions of law.

No GST on :-

  • Liquidated damages paid for breach of contract.
  • Compensation given to previous allottees of coal blocks for cancellation of their licenses pursuant to Supreme Court Order.
  • Cheque dishonour fine/penalty charged by a power distribution company from the customers
  • Penalty paid by a mining company to State Government for unaccounted stock of river bed material
  • Bond amount recovered from an employee leaving the employment before the agreed period
  • Late payment charges collected by any service provider for late payment of bills.
  • Fixed charges collected by a power generating company from State Electricity Boards (SEBs) or by SEBs/DISCOMs from individual customer for supply of electricity.
  • Cancellation charges recovered by railways for cancellation of tickets, etc.
  • Link of circular: https://taxinformation.cbic.gov.in/view-pdf/1003115/ENG/Circulars
  • Advice for readers: pls refer definition of supply.

Commerce, Trade & Auxiliaries to Trade

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Commerce, Trade and Auxiliaries to trade

  • Commerce -includes two types of activities i.e. trade and auxiliaries to trade.
  • Trade-buying and selling of goods.
  • Auxiliaries to trade-activities that are required to facilitate the purchase and sale of goods. Example- banking, transport, insurance, communication, advertisement, packaging and warehousing.


commerce courses after 12th

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UG Courses available after 12th in Commerce Stream

  1. B.Com- Bachelor of Commerce.

2. B.Com (Hons.)

3. BBA- Bachelor of Business Administration.

4. BA-A (Hons.) in Economics.

5. Integrated Law Program- B. Com+ LL. B.

6. Integrated Law Program- BBA + LL.B.