Block of assets

This query is : Resolved

varsha kanojia (Querist)
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09 August 2011 Suppose an asset is sold from block of asset and consideration is received in form of another asset(other than cash). In this case consideration received will not be deducted as moneys payable but whether that asset received will be included in that block?

CA Aditya Goel

CA Aditya Goel (Expert)
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09 August 2011 Yes. If that asset belong to that group.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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10 August 2011 Sub Clause (2) of clause (iii) of Section 32(1) says that "sold" includes a transfer by way of exchange or...."
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The old asset will be deemed as sold and
the moneys payable in this case will be the WDV of it , provided any difference amount is not being considered.
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The new exchanged asset will be added to the block, at the WDV of the old and the
old asset will be deleted from the WDV.
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The value shown will not differ in case where no difference amount is there.
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However, the most important issue will be deprection of less than 180 days. In this case if the exchanged (new) asset has been used for less than 180 days, Dep. at Half the Rate can be claimed.
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As such Depreciation on old asset can NOT be claimed as the said asset is deemed to be sold during the year.

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