Computer software

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JALPA (Querist)
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08 June 2013 Upgradation of computer software and purchase of computer software are treated as fixed asset or revenue expenditure under finance act,2012?????

Ganeshbabu K

Ganeshbabu K (Expert)
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08 June 2013 upgradation of software , purchase of licences and purchase of computer software are intangeble assets,

therefore, expenditure incurred on purchase of software/upgradation software should have been capitalised and amortised over their estimated useful life as per AS 26,

Reference

opinion given by icai commitee
https://220.227.161.86/eac/eacfinal/vol26/2.htm

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CS RAJESH C.CHOUDHARY

CS RAJESH C.CHOUDHARY (Expert)
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08 June 2013 Agreed wiht the Expert, Upgradation of software is treated as Intangible Asset and It should be capitalised

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Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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09 June 2013 i) O.K for accounting purpose.

ii) For income tax purpose treat as revenue expenditure.

Citation:-
a) CIT Vs. Southern Roadways Ltd (2008) 304 ITR 84(Mad).
b) CIT Vs. Asahi India Safety Glass Ltd (2011) (Del).

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JALPA

JALPA (Querist)
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15 June 2013 Thank you sir

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