Depreciation on Fixed Asset

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This query is : Resolved

Arindam Roy (Querist)

29 September 2008 1.If a Fixed asset put to use and remain idle for some time, then whether we can calculate depreciation on the same as per companies act and as per accounting standard? and what is the provision for the same in Income tax act?

2.Revaluation to a fixed asset is acknowledge by companies act and as per AS 6 we can calculate depreciation on revalued figure? but it is not clear to me whether revalued amount is accepted for depreciation calculation as per IT act?
Please help.

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)

29 September 2008 1. Depreciation will be calculated for the entire period.

2. Revaluation figure will not be accepted for IT assessment.

Ravikumar.G

Ravikumar.G (Expert)

29 September 2008 Further, as per co's Act, Depreciation calculated for Revalued assets should be deducted from the Revaluation reserve. As per IT there is no such depreciation is allowed.

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)

29 September 2008 The deduction from revaluation portion should be limited to depreciation on revaluation amount.

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