25 June 2021
Hello Sir/Madam Requesting clarification
Is AS 10 applicable if a fixed asset like land is given on lease/rent to another person to construct a building upon it? Reasons on why I considered AS 10 : 1. land is a fixed asset and held with intention of being used for the purpose of producing or providing services 2. addition or extension of capital nature to an existing asset (as the land is given on rent/lease )
25 June 2021
AS 10 applicable on land for the purpose of capitalising the land in the books of accounts and not to charge depreciation on land. AS 10 not applicable if the lessee constructed building on leased land, as the building belongs to the lessee till the competition of lease period.
CAclubindia
