banner_ad

Pre-operative expenses

This query is : Resolved 
Profile Image

Profile Image

(Querist)
19 February 2013 What should be the treatment of Trial-Run Expenses (consisting of all revenue expenses). Will these be capitalised by apportionemet in Fixed Costs??
Profile Image

Sumit Grover

Profile Image

Sumit Grover (Expert)
19 February 2013 It should be capitalised as an indirect element of the construction cost.(Para 9.3. of AS-10).But,the expenditure incurred after the plant has begun commercial production, is not capitalised
Profile Image

Nikhil Kaushik

Profile Image

Nikhil Kaushik (Expert)
19 February 2013 Dear Neha,

such expense should be capitalized.

For the tax treatment the same has been validated by Supreme Court in the case of Challapalli Sugars Limited Vs. CIT (supra) and CIT Vs. Hindustan Petroleum Corporation, (1975) 98 ITR 167.

Another recent ITAT (delhi bench) judgment in the case of Cosmic Kitchen Pvt Ltd v ACIT (ITA No. 5549/Del/2010) also relied on the above judgments to rule in the similar treatment of pre-op or trial run expenses.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now


CCI Pro
Join CAclubindia WhatsApp Finance Community & stay updated with the latest TAX news, compliance alerts and important updates all in one place!


Similar Resolved Queries


loading


Unanswered Queries


banner

Trending Online Classes

view all classess

CCI Pro
Meet our CAclubindia PRO Members
Subscribe Now

Follow us
add to google news



Answer Query



Quick Links



Browse by Category




Latest Job Openings

View all
Company
11 May 2026
AUDIT INTERN

M/S K.K.KHANNA AND COMPANY

Noida

CA Foundation

View Details
Company
22 May 2026
Audit assistant

Displayandbeyond

Mumbai

CA

View Details
Company
ARTICLESHIP 17 May 2026
CA Article /Trainee

Malik Sunil & co

New Delhi

CA Foundation

View Details
Company
26 May 2026
Senior Accountant cum purchase Manager

Vardhaman Group of India

Pimpri Chinchwad

CA Inter

View Details
Company
22 May 2026
Sr. Financial Analyst - Consolidation

Search Synergy

Mumbai

CA

View Details
Company
18 May 2026
MIS Executive

Primarc Pecan Retail Limited

Mumbai

B.Com

View Details
Company
19 May 2026
Fundraising Expert

MentorsWorld Ventures Private Limited

Ahmedabad

Others

View Details
Company
16 May 2026
Audit clerk

mgirt & co

Bengaluru

CA Inter

View Details