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CA SONI KRUNAL (Querist)

04 October 2010 what is the effect if i sold one machine at rs 18.00 lac if wdv of my whole 15 % block is 15.00 lac which include vehicle and mobile etc which is never sold ?

what is the situation if i sold those assests later on?whether it will be capital receipt or capital gain ?

should i claim dep on those vehicle and mobile in next yr ?

what is the effect on dep as per co's act in above case ? as per me it should remain unchange

Bhargav

Bhargav (Expert)

04 October 2010 The capital gains when the above asset is sold will be Rs.3lacs (sale consideration minus WDV of the block)

This will be carried forward in the books as fully written down block.
When subsequently other assets in the block are sold, the entire amount will be capital gain(as the WDV is nil) and NOT a capital receipt.

Since the block is nil in the next year, you cant claim depreciation(though there are some assets)

As per the companies act, there is no block of assets concept. Accordingly, every asset has gross book value and accumulated depreciation. The difference between the two is Net book value. This has to be subtracted from sale proceeds to arrive at "Profit on sale of asset"

P.S - vehicle and mobile can never be in the same block

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