Up to FY 2007-08 I was using Car which was purchased dr FY 2005-06 and claiming Depreciation. During FY 2008-09 I Purchased new Car & Started to Claim Depreciation only on new Car and old Car meant for personal use only and no depreciation is claimed on old Car from FY 2008-09. Now this old Car is Sold for profit of Rs.75,000. Now my question is Whether this profit should deduct in value of onother Car or to be trated as profit. If it is treated as profit whether Taxable. Kindly let me know
29 April 2011
Depreciation on assets is not allowed under IT act if assets are using ur personal use...so this amount of Rs. 75000/- should be deducted from the WDV of Plant and Machinery Block under IT Act..in books of accounts, if u follow the SLM method than this amount should be ur profit and follow the WDV Block concept than treatment will be same as in IT ACt
CAclubindia
