You can take 100% credit for capital goods. But you can not use more than 50% of the same, in the year of purchase. Balance can be used in the subsequent year/s.
For example if you purchase machinery worth Rs 10 Lakhs and pay duty of Rs 163800 in November 2007 to your supplier, you can take maximum credit of Rs 81900 in the year 2007-08 and the balance in 2008-09 or thereafter.
03 November 2007
Hi In case of capital goods ,credit of duty not exceeding 50 % can be taken in the year of acquisition and the balance in the subsequent years provided capital goods are still in possesion.in case capital goods are removed in the first year 100% credit will be allowed in the year of acqusition of asset.
CAclubindia
