Revenue or Capital Exp
This query is : Resolved
16 April 2008
Assessee purchased DVD writer for Rs.1450/- for upgradation in technology by repalcing old CD Writer whether it is capital / revenue exp?
Also he upgraded Tally 7.2 software to Tally 9 whether this is cap or revenue exp
Also he upgraded Tally 7.2 software to Tally 9 whether this is cap or revenue exp
16 April 2008
both are revenue in the nature.
Coz its only upgradation or replacement and nothing new establishment.
If you purchase a hardware (Not replacement) without which your system will not work and the cost of such hardware is more then 5000 then only you have to capitalize the same.
Coz its only upgradation or replacement and nothing new establishment.
If you purchase a hardware (Not replacement) without which your system will not work and the cost of such hardware is more then 5000 then only you have to capitalize the same.
16 April 2008
reply for your message to me:
yeh, you are correct in the case of AC, the capacity should be increased from the first installed capacity. and in case of ac the capacity is increasing by more then 100%. but in the case of CD and DVD player there is change in technology and not the increase in capacity. the capacity of overall computer should be increased and that can be increased by changing the motherboard, RAM and processor only. moreover the difference can not be taken as capital expenses, yeah if you want to capitalize it even the cost is less then 5000, you can, but you should capitalize it by the full amount and not by difference. In my opinion you should not capitalize the DVD Player. **DM
yeh, you are correct in the case of AC, the capacity should be increased from the first installed capacity. and in case of ac the capacity is increasing by more then 100%. but in the case of CD and DVD player there is change in technology and not the increase in capacity. the capacity of overall computer should be increased and that can be increased by changing the motherboard, RAM and processor only. moreover the difference can not be taken as capital expenses, yeah if you want to capitalize it even the cost is less then 5000, you can, but you should capitalize it by the full amount and not by difference. In my opinion you should not capitalize the DVD Player. **DM
19 April 2008
MR DASHRATH IS CORRECT
21 April 2008
Thanks for telling that I am correct ???
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Account freezed for Ineligible ITC Scrutiny for GST Annual Return
- TDS on property - Form 141 query
- Seeking Advice: High Tax Shortfall on Job Switch + Let-Out House Property Loss in FY 2025-26
- Housing Society-ITR5
- TDS on Rent received on redevelopment of building
- Indian IT Portal issue in computing tax as per UK-India DTAA
- Capital Gains on sale of residential flat
- Upload Level ValidationITR3Category of Defect B/D
- PF Taxable Income
- Clarification on Tax Audit Applicability and Reporting of F&O Transactions in ITR-3
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
