Depreciation Rate CHart

Ratan Deep Saxena (Asstt Manager (Accounts & Finance)) (2998 Points)
Replied 22 October 2009

Dear Hemant,

Depreciation chart as per income tax act is as given:

	Block of Assets	Depreciation rates as % of W.D.V. A/Y 2006-2007 onwards
I. Buildings [See Notes 1 to 4 below the Table]
(1)	Buildings which are used mainly for residential purposes except hotels and boarding houses	5
(2)	Building other than those used mainly for residential purposes and not covered by sub-items (1) above and (3) below	10
(3)	Building acquired on or after the 1^st day of September, 2002 for installing machinery and plant forming part of water supply project or water treatment system and which is put to use for the purpose of business of providing infrastructure facilities under clause (i) of sub-section (4) of section 80-IA	100
(4)	Purely temporary erections such as wooden structures	100
II. Furniture and Fittings
(1)	Furniture and Fittings including electrical fittings [See Note 5 below the Table]	10
III. Machinery and Plant
(1)	Machinery and plant other than those covered by sub-items (2), (3) and (8) below	15
(2)	Motor cars, other than those used in a business of running them on hire, acquired or put to use on or after the 1^st day of April, 1990	15
(3) (i)	Aeroplanes – Aeroengines	40
(ii)	Motor buses, motor lorries and motor taxis used in a business of running them on hire	30
(iii)	Commercial vehicle which is acquired by the assessee on or after the 1^st day of October, 1998, but before the 1^st day of April, 1999 and is put to use for any period before the 1^st day of April, 1999 for the purposes of business or profession in accordance with the third proviso to clause (ii) of sub-section (1) of section 32 [See Note 6 below the Table]	40
(iv)	New commercial vehicle which is acquired on or after the 1^st day of October, 1998 but before the 1^st day of April, 1999 in replacement of condemned vehicle of over 15 years of age and is put to use for any period before the 1^st day of April, 1999 for the purposes of business or profession in accordance with the third proviso to clause (ii) of sub-section (1) of section 32 [See Note 6 below the Table]	60
(v)	New commercial vehicle which is acquired on or after the Ist day of April, 1999 but before the Ist day of April, 2000 in replacement of condemned vehicle of over 15 years of age and is put to use before the 1^st day of April, 2000 for the purposes of business or profession in accordance with the second proviso to clause (ii) sub-section (1) of section 32 [See Note 6 below the Table]	60
(vi)	New commercial vehicle which is acquired on or after the 1^st day of April, 2001 but before the 1^st day of April, 2002 and is put to use before the 1^st day of April, 2002 for the purposes of business or profession [See Note 6 below the Table]	50
(vii)	Moulds used in rubber and plastic goods factories	30
(viii)	Air Pollution control equipment being (a) Electrostatic precipitation systems (b) Felt-filter systems (c) Dust collector systems (d) Scrubber-counter current/venturi/packed-bed/cyclonic scrubbers (e) Ash handling system and evacuation being	100
(ix)	Water pollution control equipment being (a) Mechanical screen systems (b) Aerated detritus chambers (including air compressor) (c) Mechanically skimmed oil and grease removal systems (d) Chemical feed systems and flaash mixing equipment (e) Mechanical flocculators and mechanical reactors (f) Diffused air/mechanically aerated activated sludge systems (g) Aerated lagoon systems (h) Biofilters (i) Methane-recovery anaerobic digester systems (j) Air floatation systems (k) Air/steam stripping systems (l) Urea hydrolysis systems (m) Marine outfall systems (n) Centrifuge for dewatering sludge (o) Rotating biological contractor or bio-disc (p) Ion exchange resin column (q) Activated carbon column	100
(x)	(a) Solidwaste control equipments, being- caustic/lime/chrome/mineral/crinoline recovery system (b) Solidwaste recycling and resource recovery systems	100
(xi)	Machinery and plant used in semi-conductor industry converting all integrated circuits (ICs) (excluding hybrid integrated circuits) ranging from small scale integration (SSI) to large scale integration/very large scale integration (LSI/VLSI) as also discrete semi-conductor devices such as diodes, transistors, thyristors, triacs, etc.) other than those covered by entries (viii), (ix) and (x) of this sub-item and sub-item (8) below	30
(xia)	Life saving medical equipment, being- (a) D.C. Defibrillators for internal use and pace makers (b) Haemodialysors (c) Heart lung machine (d) Cobalt Therapy Unit (e) Colour Doppler (f) SPECT Gamma Camera (g) Vascular Angiography System including Digital subtraction Angiography (h) Ventilator used with anesthesia apparatus (i) Magnetic Resonance Imaging System (j) Surgical Laser (k) Ventilators other than those used with anesthesia (l) Gamma knife (m) Bone Marrow Transplant Equipment including silastic long standing intravenous catheters for chemotherapy (n) Fibreoptic endoscopes including Pediatric resectoscope/audit resectoscope, Peritoneoscopes, Arthroscopy, Micro-laryngoscope, Fibreoptic Flexible Nasal Pharyngo Bronchoscope, Fibreoptic Flexible Laryngo Bronchoscope, Video Laryngo Bronchoscope and Video Oesophago Gastro-scope, Stroboscope, Fibreoptic Flexible Oesophago Gastro-scope (o) Laparoscope (single incision)	40
(4)	Containers made of glass or plastic used as re-fills	50
(5)	Computers including computer software [See note 7 below the Table]	60
(6)	Machinery and plant, used in weaving, processing and garment sector of textile industry, which is purchased under TUFS on or after the 1^st day of April, 2001 but before the 1^st day of April, 2004 and is put to use before the 1^st day of April, 2004 [See Note 8 below the Table]	50
(7)	Machinery and plant, acquired and installed on or after the 1^st day of September, 2002 in a water supply project or a water treatment system and which is put to use for the purpose of business of providing infrastructure facility under clause (i) of sub-section (4) of section 80-IA [See Notes 4 and 9 below the Table]	100
(8) (i)	Wooden parts used in artificial silk manufacturing machinery	100
(ii)	Cinematograph films-bulbs of studio lights	100
(iii)	Match factories-Wooden match frames	100
(iv)	Mines and quarries (a) Tubs, winding ropes, haulage rope and sand stowing pipes (b) Safety lamps	100
(v)	Salt works-Salt pans, reservoirs and condensers, etc., made of earthy, sand or clayey material or any other similar material	100
(vi)	Flour Mills-Rollers	80
(vii)	Iron and Steel industry-Rolling mill rolls	80
(viii)	Sugar Works-Rollers	80
(ix)	Energy saving devices being-
A.	Specialised boilers and furnaces; (a) Ignifluid/fluidized bed boilers (b) Flameless furnaces and continuous pusher type furnaces (c) Fluidized bed type hear treatment furnaces (d) High efficiency boilers (thermal efficiency higher than 75 per cent in case of coal fired and 80 per cent in case of oil/gas fired boilers	80
B.	Instrumentation and monitoring system energy flows; (a) Automatic electrical load monitoring systems (b) Digital heat loss meters (c) Micro-processor based control systems (d) Infra-red thermograph (e) Meters for measuring heat losses, furnace oil flow, stream flow, electric energy and power factor meters (f) Maximum demand indicator and clamp on power meters (g) Exhaust gases analyzer (h) Fuel oil pump test bench	80
C.	Waste heat recovery equipments; (a) Economisers and feed water heaters (b) Recuperators and air pre-heaters (c) Head pumps (d) Thermal energy wheel for high and low temperature waste heat recovery	80
D.	Co-Generation systems; (a) Back pressure pass out, controlled extraction, extraction-cum- condensing turbines for co-generation along with pressure boilers (b) Vapour absorption refrigeration systems (c) Organic rankine cycle power systems (d) Low inlet pressure small steam turbines	80
E.	Electrical equipments (a) Shunt capacitors and synchronous condenser systems (b) Automatic power cut off devices (relays) mounted on individual motors (c) Automatic voltage controller (d) Power factor controller for AC Motors (e) Solid state devices for controlling motor speeds (f) Thermally energy-efficient stenters (which require 800 or less kilocalories of heat to evaporate one kilogram of water) (g) Series compensation equipment (h) Flexible AC Transmission (FACT) devices- Thyristor controlled series compensation equipment (i) Time of Day (TOD) energy meters (j) Equipment to establish transmission highways for National Power Grid to facilitate transfer of surplus power of one region to the deficient region (k) Remove terminal units/intelligent electronic devices, computer hardware/software, router/bridges, other required equipment and associated communication systems for supervisory control and data acquisition systems, energy management systems and distribution management systems for power transmission systems (l) Special energy meters for Availability Based Tariff (ABT)	80
F.	Burners; (a) 0 to 10 per cent excess air burners (b) Emulsion burners (c) Burners using air with high pre-heat temperature (above 300’ C)	80
G.	Other equipment; (a) Wet air oxidation equipment for recovery of chemicals and heat (b) Mechanical vapour re-compressors (c) Thin film evaporators (d) Automatic micro-processor based load demand controllers (e) Coal based producer gas plants (f) Fluid drives and fluid couplings (g) Turbo Charges/super charges (h) Sealed radiation sources for radiation processing plants	80
(x)	Gas cylinders including valves and regulators	60
(xi)	Glass manufacturing concerns – Direct fire glass melting furnaces	60
(xii)	Mineral Oil concerns (a) Plant used in field operations (above ground), distribution-Returnable (b) Plant used in field operations (below ground), but not including kerbside pumps including underground tanks and fitting used in field operations (distribution) by mineral oil concerns	60
(xii)	Renewal energy devices being- (a) Flat plate solar collectors (b) Concentrating and pipe type solar collectors (c) Solar Cookers (d) Solar water heaters and systems (e) Air/gas fluid heating systems (f) Solar crop driers and systems (g) Solar refrigeration, cold storages and air-conditioning systems (h) Solar power generating systems (i) Solar power generating systems (j) Solar pumps based on solar-thermal and solar photovoltaic conversion (k) Solar photovoltaic modules and panels for water pumping and other applications (l) Wind mills and any specially designed devices which run on wind mills (m) Any special devices including electric generators and pumps running on wind energy (n) Bio-gas plant and bio-gas engines (o) Electrically operated vehicles including battery powered or fuel-cell powered vehicles (p) Agricultural and municipal waste conversion devices producing energy (q) Equipment for utilising ocean waste and thermal energy (r) Machinery and plant used in the manufacture of any of the above sub-items	80
9 (i)	Books owned by assessees carrying on a profession (a) Books, being annual publications (b) Books, other than those covered by entry (a) above	100 60
(ii)	Books owned by assessees carrying on business in running lending libraries	100
IV. Ships
(1)	Ocean-going ships including dredgers, tugs, barges, survey launches and other similar ships used mainly for dredging purposes and fishing vessels with wooden hull	20
(2)	Vessels ordinarily operating on inland waters, not covered by sub-item (3) below	20
(3)	Vessels ordinarily operating on inland waters being speed boats (see Note 10 below the Table)	20

PART B

INTANGIBLE ASSETS

Know-how, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature

25

Note:-

1. “Buildings” include roads, bridges, culverts, wells and tube-wells

2. A building shall be deemed to be a building used mainly for residential purposes, if the built-up floor area thereof used for residential purposes is not less than sixty-six and two their per cent of its total built up floor area and shall include any such building in the factory premises.

3. In respect of any structure or work by way of renovation or improvement in or in relation to a building referred to in Explanation 1 of clause (ii) of sub-item (1) of section 32, the percentage to be applied will be the percentage specified against sub-item (1) or (2) of item I as may be appropriate to the class of building in or in relation to which the renovation or improvement is effected. Where the structure is constructed or the work is done by way of extension of any such building, the percentage to be applied would be such percentage as would be appropriate, as if the structure or work constituted a separate building.

4. Water treatment system includes system for desalinisation, demineralisation and purification of water.

5. “Electrical fittings” include electrical wiring, switches, sockets, other fittings and fans, etc.

6. “Commercial vehicle” means “heavy goods vehicle”, heavy passenger motor vehicle”, “light motor vehicle”, “Medium goods vehicle” and “medium passenger motor vehicle” but does not include “maxi-cab”, “motor-cab”, “tractor” and “road-roller”. The expressions “heavy goods vehicle”, “heavy passenger motor vehicle”, “light motor vehicle”, “medium passenger motor vehicle”, “maxi-cab”, “tractor” and “road-roller” shall have the meanings respectively as assigned to them in section 2 of the Motor Vehicles Act, 1988]

7. “Computer software” means any computer programmed recorded on any disc, tape, perforated media or other information storage device.

8. “TUFS” means Technology Up-gradation Fund Scheme announced by the Government of India in the form of a Resolution of the Ministry of Textiles vide No. 28/1/99-CTI of 31-3-1999.

9. Machinery and plant includes pipes needed for delivery from the source of supply of raw water to the plant and from the plant to the storage facility.

10. “Speed boat” means a motor boat driven by a high speed internal combustion engine capable of propelling the boat at a speed exceeding 24 kilometers per hour in still water and so designed that when running at a speed, it will rise from the water.

regards,

ratan

4 Like

Ratan Deep Saxena (Asstt Manager (Accounts & Finance)) (2998 Points)
Replied 22 October 2009

Dear Hemant,

Depreciation as per Companies act is given below for your reference:

schedule xiv

[See sections 205 and 350]

Rates of depreciation

Nature of assets		Single Shift		Double Shift		Triple Shift
		WDV	SLM	WDV	SLM	WDV	SLM
1		2	3	4	5	6	7
I. (a)	BUILDINGS (other than factory buildings) [NESD]	5%	1.63%	…..	…..	…..	…..
(b)	FACTORY BUILDINGS	10%.	3.34%	…..	…..	…..	…..
(c)	PURELY TEMPORARY ERECTIONS such as wooden structures	100%	100%	…..	…..	…..	…..
II. PLANT AND MACHINERY
¹[(i) General rate applicable to,—
(a) plant and machinery (not being a ship) other than continuous process plant for which no special rate has been prescribed under (ii) below		13.91%	4.75%	20.87%	7.42%	27.82%	10.34%
(b) continuous process plant, 2[* * *] for which no special rate has been prescribed under (ii) below [NESD]		15.33%	5.28%	…..	…..	…..	…..]
(ii) Special rates
A.1.Cinematograph films – Machinery used in the production and exhibition of cinematograph films [NESD]		20%	7.07%	…..	…..	…..	…..
(a) Recording equipment, reproducing equipment, developing machines, printing machines, editing machines, synchronisers and studio lights except bulbs
(b) Projecting equipment of film exhibiting concerns
2. Cycles [NESD]
³[3. Electrical machinery, X-ray and electro-therapeutic apparatus and accessories thereto, medical, diagnostic equipments, namely, cat-scan, ultrasound machines, ECG monitors, etc. [NESD]		20%	7.07%	…..	…..	…..	…..
4. Juice boiling pans (karhais) [NESD]		20%	7.07%	…..	…..	…..	…..
5. Motor-cars, motor-cycles, scooters and other mopeds [NESD]		25.89%	9.5%	…..	…..	…..	…..
6. Electrically operated vehicles including battery powered or fuel cell powered vehicles [NESD]		20%	7.07%	…..	…..	…..	…..
7. Sugarcane crushers (indigenous kolhus and belans) [NESD]		20%	7.07%	…..	…..	…..	…..
8. Glass manufacturing concerns except direct fire glass melting furnaces – Recuperative and regenerative glass melting furnaces		20%	7.07%	30%	11.31%	40%	16.21%
9. Machinery used in the manufacture of electronic goods and components		15.62%	5.38%	23.42%	8.46%	31.23%	11.87%]
B. 1. ⁴[Aeroplanes, aero engines, simulators, visual system and quick engine change equipment [NESD]		16.2%	5.6%]
2. Concrete pipes manufacture—Moulds [NESD]		30%	11.31%	…..	…..	…..	…..
3. Drum containers manufacture—Moulds [NESD]
4. Earth-moving machinery employed in heavy construction works, such as dams, tunnels, canals, etc. [NESD]
5. Glass manufacturing concerns except direct fire glass melting furnaces—Moulds [NESD]
6. Moulds in iron foundries [NESD]
7. Mineral oil concerns—Field operations (above ground)—Portable boilers, drilling tools, well-head tanks, rigs, etc. [NESD]
8. Mines and quarries—Portable underground machinery and earth-moving machinery used in open cast mining [NESD]
9. Motor buses and motor lorries other than those used in a business of running them on hire [NESD]
9A. Motor tractors, harvesting combines [NESD]
10. Patterns, dies and templates [NESD]
11. Ropeway structures—Ropeways, ropes and trestle sheaves and connected parts [NESD]
12. Shoe and other leather goods fabrics—Wooden lasts used in the manufacture of shoes		30%	11.31%	45%	18.96%	60%	29.05%
C. 1. ⁵[ **]
2. Motor buses, motor lorries and motor taxis used in a business of running them on hire [NESD]		40%	16.21%	…..	…..	…..	…..
3. Rubber and plastic goods factories—Moulds [NESD]
4. Data processing machines including computers [NESD]		40%	16.21%	…..	…..	…..	…..
5. Gas cylinders including valves and regulators [NESD]
D. 1. Artificial silk manufacturing machinery with wooden parts		100%	100%	…..	…..	…..	…..
2. Cinematograph films—Bulbs of studio lights
3. Flour mills—Rollers
4. Glass manufacturing concerns—Direct fire glass melting furnaces
4A. Flot Glass Melting Furnaces (NESD)		27%	10%	…..	…..	…..	…..
5. Iron and Steel industries—Rolling mill rolls		100%	100%	…..	…..	…..	…..
6. Match factories—Wooden match frames
7. Mineral oil concerns—(a) Plant used in field operations (below ground)—Distribution – returnable packages; (b) Plant used in field operations (below ground) but not including assets used in field operations (distribution)—Kerbside pumps including underground tanks and fittings
8. Mines and quarries—
(a) Tubs, winding ropes, haulage ropes and sand stowing pipes
(b) Safety lamps
9. Salt works—Salt pans, reservoirs and condensers, etc., made of earthy, sandy or clay material or any other similar material
10. Sugar works—Rollers
III. FURNITURE AND FITTINGS
⁶[1. General Rates [NESD]		18.1%	6.33%	…..	…..	…..	…..
2. Rate for furniture and fittings used in hotels, restaurants and boarding houses; schools, colleges and other education al institutions, libraries; welfare centres; meeting halls, cinema houses; theatres and circuses; and for furniture and fittings let out on hire for use on the occasion of marriages and similar functions [NESD]
IV. SHIPS
1. Ocean-going ships—		25.88%	9.5%	…..	…..	…..	…..
(i) Fishing vessels with wooden hull [NESD]
(ii) Dredgers, tugs, barges, survey launches and other similar ships used mainly for dredging purposes [NESD]		27.05%	10%	…..	…..	…..	…..
(iii) Other ships [NESD]		19.8%	7%	…..	…..	…..	…..
2. Vessels ordinarily operating on inland waters—		14.6%	5%	…..	…..	…..	…..
(i) Speed boats [NESD]
(ii) Other vessels [NESD]
WDV means written down value		20%	7.07%	…..	…..	…..	…..
SLM means straight line method		10%	3.34%	…..	…..	…..	…..

NOTES

1. “Buildings” include roads, bridges, culverts, wells and tube-wells.

2. “Factory buildings” does not include offices, godowns, officers’ and employees’ quarters, roads, bridges, culverts, wells and tube-wells.

3. “Speed boat” means a motor boat driven by a high speed internal combustion engine capable of propelling the boat at a speed exceeding 24 kilometres per hour in still water and so designed that when running at a speed it will plane, i.e., its bow will rise from the water.

4. Where, during any financial year, any addition has been made to any asset, or where any asset has been sold, discarded, demolished or destroyed, the depreciation on such assets shall be calculated on a pro rata basis from the date of such addition or, as the case may be, up to the date on which such asset has been sold, discarded, demolished or destroyed.

5. The following information should also be disclosed in the accounts:

(i) depreciation methods used; and

(ii) depreciation rates or the useful lives of the assets, if they are different from the principal rates specified in the Schedule.

6. The calculations of the extra depreciation for double shift working and for triple shift working shall be made separately in the proportion while the number of days for which the concern worked double shift or triple shift, as the case may be, bears to the normal number of working days during the year. For this purpose, the normal number of working days during the year shall be deemed to be—

(a) in the case of a seasonal factory or concern, the number of days on which the factory or concern actually worked during the year or 180 days, whichever is greater;

(b) in any other case, the number of days on which the factory or concern actually worked during the year or 240 days, whichever is greater.

The extra shift depreciation shall not be charged in respect of any item of machinery or plant which has been specifically, excepted by inscripttion of the letters “NESD” (meaning “no extra shift depreciation”) against it in sub-items above and also in respect of the following items of machinery and plant to which the general rate of depreciation of ⁷[13.91] per cent applies—

(1) Accounting machines.

(2) Air-conditioning machinery including room air-conditioners.

(3) Building contractor’s machinery.

(4) Calculating machines.

(5) Electrical machinery—switchgear and instruments, transformers and other stationary plant and wiring and fitting of electric light and fan installations.

(6) Hydraulic works, pipelines and sluices.

(7) Locomotives, rolling stocks, tramways and railways used by concerns, excluding railway concerns.

(8) Mineral oil concerns—field operations:

(a) ⁸[* * *]

(b) Prime movers

(c) ⁸[* * *]

(d) Storage tanks (above ground)

(e) Pipelines (above ground)

(f) Jetties and dry docks

(9) Mineral oil concerns—field operations (distribution)—kerbside pumps, including underground tanks and fittings.

(10) Mineral oil concerns—refineries :

(a) ⁹[* * *]

(b) Prime movers

(c) ⁹[* * *]

¹⁰[(d) LPG Plant]

(11) Mines and quarries :

(a) Surface and underground machinery (other than electrical machinery and portable underground machinery)

(b) Head-gears

(c) Rails

(d) ⁹[* * *]

(e) Shafts and inclines

(f) Tramways on the surface

(12) Neo-post franking machines.

(13) Office machinery.

(14) Overhead cables and wires.

(15) Railway sidings.

(16) Refrigeration plant container, etc. (other than racks).

(17) Ropeway structures :

(a) Trestle and station steel work.

(b) Driving and tension gearing.

(18) Salt works—Reservoirs, condensers, salt pans, delivery channels and piers if constructed of masonry, concrete, cement, asphalt or similar materials; barges and floating plant; piers, quays and jetties; and pipelines for conveying brine if constructed of masonry, concrete, cement, asphalt or similar materials.

(19) Surgical instruments.

(20) Tramways electric and tramways run by internal combustion engines—permanent way: cars—car trucks, car bodies, electrical equipment and motors; tram cars including engines and gears.

(21) Typewriters.

(22) Weighing machines.

(23) Wireless apparatus and gear, wireless appliances and accessories.]

(24) ¹¹[* * *]

¹²[7. ‘Continuous process plant’ means a plant which is required and designed to operate 24 hours a day.

8. Notwithstanding anything mentioned in this Schedule, depreciation on assets, whose actual cost does not exceed five thousand rupees, shall be provided at the rate of hundred per cent:]

¹³[Provided that where the aggregate actual cost of individual items of plant and machinery costing Rs. 5,000 or less constitutes more than 10 per cent of the total actual cost of plant and machinery, rates of depreciation applicable to such items shall be the rates as specified in Item II of the Schedule.

regards,

ratan