Regarding Introducing additional capital in kind in business

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When introducing an old hotel building as capital in kind into a business, auditors must report this addition. While Clause 13(d) of Form 3CD concerns ICDS adjustments, the capital addition itself should be detailed under Clauses 17 and 18, focusing on fixed assets and property transfers. The auditor will verify the actual cost, acquisition date, and depreciation, ensuring compliance with tax regulations.

Jaswinder singh

Jaswinder singh (Querist)

22 October 2025 Respected Colleagues,
If a person running business of restaurant and introducing old hotel building in business in FY 2024-25, now my question is, whether auditor comments in tax audit report about this capital addition or not?

Please guide

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

22 October 2025 Yes. Under Clause 13(d) of Form 3CD, the auditor is required to provide details of additions or deletions to fixed assets during the financial year, including buildings, machinery, land, furniture, etc..
The auditor must mention the actual cost, date of acquisition or introduction, and depreciation details for each such asset. The business owner must provide supporting documentation (like purchase/investment value, ownership proof, and valuation certificate if applicable).

Jaswinder singh

Jaswinder singh (Querist)

22 October 2025 Sir, butin clause 13(d) ''Whether any adjustment is required to be made to the profits or loss for complying with the provisions of income computation and disclosure standards notified under section 145(2)''

not able to find any suitable column in clause 13d

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

22 October 2025 Yes, correct. The auditor should not make any comment under Clause 13(d) regarding the introduction of an old hotel building, since it does not require any ICDS adjustment to profit or loss. Reporting should instead occur under Clauses 17 and 18 for capital additions and fixed assets, while Clause 13(d) remains applicable only if ICDS-related income computation changes arise.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

22 October 2025 When an old hotel building is introduced into business:

The auditor must verify and report the capital addition in Clause 18 (Fixed Assets) and, where applicable, Clause 17 (Transfer of land/building), depending on ownership and value.

He should ensure correct actual cost determination under section 43(1), including date of put-to-use and computation of depreciation under section 32.

This introduction impacts the balance sheet and depreciation schedule.

Jaswinder singh

Jaswinder singh (Querist)

23 October 2025 Ok sir thanks a lot....................

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

23 October 2025 You are welcome.

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