Relating to income tax & vat

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amandeep singh (Querist)

08 July 2012 SIR
I WANT TO KNOW ABOUT SALE/PURCHASE TREATMENT OF CAR.
WITH THE HELP OF ILLUSTRATION :-

WDV OF OLD Car - Rs. 67000

sale of old car as on June 2011 - 65000(inclusive of vat Rs. 7222/-(12.5%))

purchase of new car as on June
2011(inclusive of Insurance Expense - Rs.6500)- Rs.500000/-

i want to know about treatment of loss on sale car Rs. 2000/- and vat treatment in dvat

if their any section relates to then please provide the same.

thanks

CA Hardik Bunha

CA Hardik Bunha (Expert)

08 July 2012 My Friend,
There is no loss on car sold, as per income tax act 1961, u/s 50(1)

WDV of car 67,000/-
ADD purchase during the year 5,00,000/-
LESS SOLD during the year (65,000/-)

hence, wdv of the block 5,02,000/-

this value should be appear in your balance sheet. depreciation will be charged on 5,02,000 as per rate i.e. 15%.

As per section 32(2) vat and other expenses related to asset will be capitalised.

VAT - it is dependent on your state and mateer with which kind of vat system you followed. in some state capitalised vat paid will be adjust against credit of vat.

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amandeep singh

amandeep singh (Querist)

16 July 2012 THANK YOU SIR FOR YOUR ADVICE....

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