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Querist : Anonymous

Querist : Anonymous (Querist)

20 December 2012 A car purchased by S on 10.08.2006 for Rs 325000 for personal use is brought into the business of the assessee on 1st dec of the relevant previous year, when its market value is Rs 150000.
compute the actual cost of the car and the amount of deprecation for the relevant Assessment year assuming the rate of depreciation to be 20%.

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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20 December 2012 I think it is put into the business use in last 6 months i.e after 181 days i.e after 2nd October so only 50% of the actual depreciation rate(i.e 10%) on Rs.325000 allowed. You just put the capital asset for business use but not converted into the stock-in-trade of the business so market value as on the date of conversion is ir-relavent and WDV of the asset shall be consider but in your case asset purchased year and put into business use is same so cost of purchase shall be the cost to business for depreciation and you put into use for business after 2nd October so i suggest 50% of actual depreciation rate(i.e 10%).
I think i may be correct. Its just my logical view and at any where i not read the section regarding your type issue thus i suggested but wait for any other comments or reply of experienced experts.

OM SAI SRI SAI JAI JAI SAI

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