Additional depreciation

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This query is : Resolved

Ashish (Querist)

09 August 2012 Can a company claim remaining half of additional depreciation on newly added plant & machinery in the subsequent year, if it had claimed 10% additional depreciation in the first year.

CA Rahul Gupta

CA Rahul Gupta (Expert)

09 August 2012 Plant & Machinery newly acquired and put to use in the same previous year for less than 180 days, the additional depreciation shall be provided at 50% of normal rate applicable
No, It can not claim remaining half of additional depreciation in next year.

Ashish

Ashish (Querist)

09 August 2012 To Mr. Rahul Gupta
Is there any clarification regarding the same in Income Tax Act, if yes can you please provide the reference of same...
Thank you in advance..

CA Rahul Gupta

CA Rahul Gupta (Expert)

09 August 2012 the concept of “actual cost” is relevant only in the year of acquisition of asset. The concept of actual cost generally does not survive in the second & subsequent years. Additional depreciation is computed with reference to actual cost’. If the concept of actual cost does not survive in the second year, whether the balance of additional depreciation which is based on actual cost would survive?
The words “shall be allowed” refers to the mandatory nature of deduction for Additional Depreciation.

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