Assets less than rs 5000
This query is : Resolved
23 June 2012
Hi,kindly clarify the details.some asset has been bought by a private company in the financial year 2011-12,having value less than Rs5000.During the financial year, the company has transferred the said assets as sale to another SBU of its parent company.The company has provided depreciation to the asset for the financial year up to its usage and raised the bill for residual value.The auditors of the company says that, asset having value less than 5000 is to be provided with 100% depreciation and should be written off during the financial year. But the company has sold the assets at depreciated value.. kindly clarify what the company should do,kindly clarify as soon as possible... Thanks in advance...
23 June 2012
Yes, Auditor is right, in the company if value of asset is less than rs. 5000 then 100% depreciation followed.
here company law will be applicable hence depreciation will be charged acccording to it but not as per income tax law.
you can take safeguard as director has decided to maintain this asset still it becomes scap. you have to mention this in director's report when company has purchase the asset
here company law will be applicable hence depreciation will be charged acccording to it but not as per income tax law.
you can take safeguard as director has decided to maintain this asset still it becomes scap. you have to mention this in director's report when company has purchase the asset
Message likes :
1 times
23 June 2012
Thanks, then what will be the value of assets in the books of SBU which purchased the assets...
23 June 2012
What will be the consequence for the items which bill were raised in the books of Pvt company
24 June 2012
Company has done the correct thing. Company can only depreciate those figure upto the date of sale. Though it is 100% but it should be proportionate in relation to month. The SB should show the asset in its books on the basis of its purchase documents. There are two ways - If the company wants to charge all the assets then the Sale Proceeds shall be charged as Profit on sale of asset otherwise there will be neither any profit nor any loss.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Difference between Date of Payment and Date of Deduction?
- TDS CREDIT MISMATCHING
- Buy back of shares u/s69
- Unregistered suppliers utility
- Tax Audit Applicability – Newly Formed Partnership Firm with Profit Below 6%/8%
- ITR 4 and Bank transactions
- Bank details not Visible on Traces Portal
- Taxability of Partnership firm for FY 2025-26
- Need Professional Opinion - AY 2012-13 Old Demand & AY 2026-27 Refund Adjustment
- Cash balance limit and property purchases limit
- EXPORT COMMERCIAL INVOICE HSN CODE
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
- CALCULATION OF DEFFERED TAX - OP BL IS DTL & CURRET IT DTA
- LLP audit under companies act
- Experienced CA recommendation from Kolkata for FNO return filing
- Interest Reporting in Form 168
- Sales of goods of amount Rs77 lakhs to a party
- Tax Demand of ₹4,650 for AY 2026-27
- Concept of Vendor and customner reconciliation
- Mistake in e-invoice identified after 24 hours
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
