Depreciation under section 32
This query is : Resolved
29 April 2013
A private limited has a building having W.D.V. as on 31.03.2012 Rs 50 crore. on 30.06.2012 it has received earnest money(bayana) of Rs.20 crore against sale of building. However due to non payment of balance amount of sale consideration, company on 01.11.2012 forfeited the earnest money. Now how should be dealt this forfeiture in books of accounts for income tax purpose:
a) Whether it will reduce the w.d.v of building by Rs.20 crore and depreciation as per income tax would be taken on Rs.30 Crore.
b) Further whether depreciation would be taken at 50% of depreciation rate or 100% of rate because forfeiture is happened on 01.11.2012 beyond 180 days.
Please treat it urgent
a) Whether it will reduce the w.d.v of building by Rs.20 crore and depreciation as per income tax would be taken on Rs.30 Crore.
b) Further whether depreciation would be taken at 50% of depreciation rate or 100% of rate because forfeiture is happened on 01.11.2012 beyond 180 days.
Please treat it urgent
29 April 2013
Following will be answers to your question :
(1)It will going to reduce your total block of assets by Rs. 20 Crores. And it will have impact on depreciation as well as assets value at the time of calculating capital gain.
(2) It will have no impact of 100% or 50% as the net block will be reduced and total depreciation will be charged for the full year considering such lower value.
(1)It will going to reduce your total block of assets by Rs. 20 Crores. And it will have impact on depreciation as well as assets value at the time of calculating capital gain.
(2) It will have no impact of 100% or 50% as the net block will be reduced and total depreciation will be charged for the full year considering such lower value.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Tax Audit Applicability – Newly Formed Partnership Firm with Profit Below 6%/8%
- TDS CREDIT MISMATCHING
- Buy back of shares u/s69
- Difference between Date of Payment and Date of Deduction?
- ITR 4 and Bank transactions
- Journal entry of busniess expenses
- IS AUDIT MANDATORY IF COMMISSION INCOME IS MORE THAN 50 LAKH
- Unregistered suppliers utility
- URGENT-Eligible leaves being shown as 24 days for 3 years Articleship instead of 156 days in 108
- Need Professional Opinion - AY 2012-13 Old Demand & AY 2026-27 Refund Adjustment
- CALCULATION OF DEFFERED TAX - OP BL IS DTL & CURRET IT DTA
- LLP audit under companies act
- Experienced CA recommendation from Kolkata for FNO return filing
- Interest Reporting in Form 168
- Sales of goods of amount Rs77 lakhs to a party
- Tax Demand of ₹4,650 for AY 2026-27
- Concept of Vendor and customner reconciliation
- Mistake in e-invoice identified after 24 hours
- EXPORT PAYMENT
- NRI ITR2 account in 2025-26.
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
