Capitalisation of administrative charges paid after 7 years

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Querist : Anonymous

Querist : Anonymous (Querist)

17 December 2014 can administrative charges paid on purchase of land from land developer after 8 years from purchase of land be capitalised? or expense out?

CA Kumar Mukesh

CA Kumar Mukesh (Expert)
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17 December 2014 Yes
Under companies act it will be capitalized as per AS-10 Accounting for fixed asset.

As per Income Tax also it will treated as Improvement as per section 55 of income tax act, 1961

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Querist : Anonymous

Querist : Anonymous (Querist)

19 December 2014 evenif it is incurred after 8 years of land purchased? if yes then why?