Dep on asset costing less than Rs 5000

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varun gupta (Querist)
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19 May 2009 Hi,

If a Company purchases some furniture say 1 executive chair costing Rs 4000/-. Will this need to be capitalized as per either Companies Act or Income tax Act.?
What if there are 10 chairs purchased in single bill totalling an amt of Rs 45000/-?

What if it purchases 10 chairs of different dates via different 10 invoices of Rs 4500 each?

Experts pls keep query OPEN after your replies to let other also to comment.

Zeeshan

Zeeshan (Expert)
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19 May 2009 if a single asset (item) is of less than 5000/- then it should be charged to revenue.
in your question a single chair is of less than 5000/- hence it should be charged to p&l a/c. it does not have any difference whether bill is single or multiple.

varun gupta

varun gupta (Querist)
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20 May 2009 It means that if there are purchases of even 50 chairs costing Rs 4000 each totalling a bill of Rs 200000, that whole amt will also be charged to P&L A/c?

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