loss on sale of depreciable assets
This query is : Resolved
18 September 2007
u/s 32
Block-I- 15%- Car(only one car)
it is sold during the Pre. year 2006-07 for Rs. 7 only ( Cost Rs. 100, WDV on 1-4-2006 is Rs. 19, no purchases during the p.y 2006-07).
i. wheter is it claimed as terminal depreciation? or
ii. wheter comes u/s 50(2) i.e. short-term capital loss?
Block-I- 15%- Car(only one car)
it is sold during the Pre. year 2006-07 for Rs. 7 only ( Cost Rs. 100, WDV on 1-4-2006 is Rs. 19, no purchases during the p.y 2006-07).
i. wheter is it claimed as terminal depreciation? or
ii. wheter comes u/s 50(2) i.e. short-term capital loss?
19 September 2007
As PER IT, THERE CANNOT BE DEPRECIATION IN THE YEAR OF SALE.
SO THE TERMINAL DEP. IS NOT APPLICABLE.
IN THE YEAR OF SALE ONE CAN CLAIM SHORT TERM CAPITAL LOSS.
PL. NOTE TERMINAL DEP. IS NORMALLY CLAIMED IN CASES WHERE STRAIGHT LINE METHOD OF DEP. IS ADOPTED( EXAMPLE POWER GENERATING UNITS) ,THOUGH THERE IS AN OPTION TO CLAIM EITHER STRAIGHT LINE OR WDV DEPRECIATION.
I SUGGEST FOR A DETAILED UNDERSTANDING OF WHAT I STATED IN BRIEF ABOVE , PL. REFER DR. VINOD SINGHANIA'S DIRECT TAXES READY RECKONER 08-09- ASST. YEAR - PARA 48.3.10a(A-84)
C.A.R.V.RAO
SO THE TERMINAL DEP. IS NOT APPLICABLE.
IN THE YEAR OF SALE ONE CAN CLAIM SHORT TERM CAPITAL LOSS.
PL. NOTE TERMINAL DEP. IS NORMALLY CLAIMED IN CASES WHERE STRAIGHT LINE METHOD OF DEP. IS ADOPTED( EXAMPLE POWER GENERATING UNITS) ,THOUGH THERE IS AN OPTION TO CLAIM EITHER STRAIGHT LINE OR WDV DEPRECIATION.
I SUGGEST FOR A DETAILED UNDERSTANDING OF WHAT I STATED IN BRIEF ABOVE , PL. REFER DR. VINOD SINGHANIA'S DIRECT TAXES READY RECKONER 08-09- ASST. YEAR - PARA 48.3.10a(A-84)
C.A.R.V.RAO
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