UPLOADED NEW 5 DIGIT ACTIVITY CODES FOR VAT AUDIT PURPOSE.

MVAT AUDIT 2009-10-ACTIVITY CODES


AS WE FOUND THAT MANY OF OUR CA FRIENDS AND STP'S ARE NOT HAVING THE NEWLY REQUIRED ACTIVITY CODE 5 DIGIT FILES.
HERE BY WE ARE UPLOADING IT FOR OUR COMMUNITY.


CLICK HERE TO DOWNLOAD (2 LINKS)-- DOWNLOADING TAKES TIME (FILE SIZE 1.31 MB)


http://dhavaldesaisays.files.wordpress.com/2010/12/activitycode1-2-1.pdf


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https://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srcid=0Bz0INWeiJAEQNDFiOTQyODItNmQ2MS00ZDgxLWJjNzctYWRlNzRkYTZjMDM3&hl=en

Case law-Ability to pay demand is no bar for grant of stay on recovery

KEC International Limited vs. ACIT (ITAT Mumbai)

The assessee filed a stay application before the Tribunal. The Department opposed by relying on the observations of the Supreme Court in CCE vs. Dunlop India 154 ITR 172 (SC) and contended that as paucity of funds had not been sufficiently demonstrated, for this reason alone stay should not be granted. HELD rejecting the Department’s contention and granting stay while following B. N. Nobis & Co vs. JCIT 71 TTJ 153 (Kol):

(i) While the Supreme Court has decried ‘the practice of granting interim orders merely because assessee is able to show a good prima facie case’, the observations have to be understood in the context of the case which was one of indirect taxation where the burden had already been passed on to the consumer. Also it was a case of a Writ Petition under Article 226 & not that of an appellate jurisdiction. The observations of the Supreme Court in the context of grant of stay in writ proceedings does not have binding force on, or even direct relevance to, the principles governing grant of stay during appellate proceedings though it does provide guidance on principles governing the decision to grant stay;

Cash Flow v/s Profit & loss A/c

In case of entities like companies which present its financial statements on accrual basis, Cash flow Statements fulfills vital information needs of users?

The Supreme Court in Reliance Energy Ltd Vs. Maharashtra State Road Development Corporation Ltd.

When P&L accounts and balance sheets are prepared on accrual basis, revenues and expenses are recognized on accrual basis

i.e. when events or transaction occurs. However, timing of cash flow is not reckoned in such system of accounting.

Similarly, in cases where accounts are based on accrual system of accounting, recognition of assets & liabilities is not dependent on the actual timing of cash spent on capital Expenditure & Cash inflow on Capital receipts.

Thus, financial statements prepared on accrual basis don not reflect the timing of Cash flow & amount of Cash flow.

The object of the cash flow statement is to assess the company ability to generate the cash flow in future and to assess reason for difference between “NET PROFIT” and “NET CASH FLOW” from operations.

In Fact Cash flow from operations is the regular sources of cash for any enterprise that determines whether or not an enterprise will continue to exist in the long run.

Accrual basis of accounting requires that revenues be recorded when earned and the expenses be recorded when incurred. Earned revenues more often include credit sales that have not been collected in cash & expense incurred that may not have been paid in cash during the accounting period.

Thus, Net Income will not indicate the net cash provided by operating activities or net loss will not indicate the net cash used in operating activities.

 In order to calculate the net cash provided by (or used in) operating activities, it is necessary to replace revenues and expenses on accrual basis with actual receipts and actual payments in cash. This is done by eliminating non- cash revenues and non-cash expenses from the given earned revenues & incurred expenses in the profit & loss account.

Profit & Loss account is also debited with purely non-cash items which reduces and increase the profits respectively but do not affect the cash at all. Eg: Depreciation, P/L on sale of fixed assets, amortization of deferred revenue expenses and so on.

Since Cash provide by operations is to be calculated, certain Non-operation item like rent income, interest income, dividend income, refund of tax etc should be adjusted although these items may have recorded on cash basis. Such items are analysed separately in the cash flow statement as operating, financing & investing activities.


Post uploaded by: Sumeet Mishra.