capital gain

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chetan (Querist)

13 July 2011 Assesse has one block which consists 2 truck

WDV AS ON 01/04/2010

RATE OF DEPRECIATION AS PER IT ACT 1961 IS 40 %

Rs12,36,000/-

On 1/07/2010 one truck sold and sale consideration receivd was Rs 9,74,000/-

And one truck met with road accident and insurance claim was lodged

and insurance company paid compensation of Rs 9,75,000/-

SUMMARY :

WDV 01/04/2010 12,36,000/-

SALE CONSDIERTAION
OF ONE TRUCK 9,74,000/-

COMPENSATION OF ONE
TRUCK ( ROAD ACCIDENT) 9,75,000/-

Assessee is Pvt Ltd Company.

Please guide me, what is the amount of CAPITAL GAIN chargeable to tax
u/s 45 1(A)
now sir, my question is , I had read in Leading book of CA FINAL FOR INCOME TAX by V K SIGANIA that as and when capital asset is destroyed in road accident, capital gain computation will have to be made in accordance with gudieline given by supreme court in case of Vania Silk Milk vs CIT SUPREME COURT ( 1991 ) and if possible please attach guide line of supreme court for my refrence .
please do needful in the matter .

CA PARAS BAFNA

CA PARAS BAFNA (Expert)

13 July 2011 In my view Section 45(1A) is not applicable
in a case of Road Accident.
However it is applicable in the case of
Accidental Fire.

You may find the case law by following the link-

https://www.indiankanoon.org/doc/1081623/

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