depreciation

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sunil (Querist)

08 March 2011 Our Company in transportation of goods we owened two trucks & claimed dep. @30% of I.T rules & WDV as on 1.4.2009 was Rs. 10.80 lacs we sold both the trucks for Rs. 15 lacs in May 2009 & purchased a new truck on 25.3.2010 for Rs.20.80 lacs The registration formalities (RTO) of the truck could not be completed before 31.3.2010. Heance the truck could not be put to commervial use till 31.3.2010.

So Pl Tell me As far as the block if assets is concerned what should be the tax implication u/s50?

What the the depreciation U/s32 of I.T. Act for Ass. Year 2010-11?

Give me the detail accounting treatm,ent of Profit/loss on sales of truch & calculation of deprecation as per accounting norms?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)

08 March 2011 You need not to travel via section 50 in this case.
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In my view, Since new truck has been acquired during the previous year only, the block is not vacated and as such , as on the 31.03.2010 the block will be shown at Rs 10.80+20.80-15.00=16.60lacs.
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Since the new truck can not be put to use, it is clear that you are not desiring to claim depreciation, as it would not be allowed on it.
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Hence no depreciation can be claimed on the only remaining asset in the block which has not been put to use.
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