Tax Treatment on Profit / Loss from Sale of Car / Machinery

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This discussion clarifies the tax treatment for profits and losses arising from the sale of company vehicles and machinery. It explains that while financial books may credit the sale value to the P&L account, for income tax purposes, depreciated assets are typically handled by adjusting the block asset value. The experts confirm that jewellery sales, unlike depreciated assets, are generally subject to Capital Gains tax.

Accounts & Tax Consultant

Accounts & Tax Consultant (Querist)
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14 May 2023 Respected Experts,

What is the Tax Treatment if a Car or Machinery Sold by a Company (Any kind firm, Proprietary, Ltd )

Can we need directly add it in to the P&L account as profit / or Loss from sale of Car or Machinery and assess Taxes at normal slab rate.

Or do we need to assess them under Capital Gains?

Kindly advise

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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14 May 2023 Capital gains will not arise in case of depreciated assets.
The sale value for the purpose of taxation can be credited to the block value of assets under income tax depreciation.
Financial books profit credit to p and l.

Accounts & Tax Consultant

Accounts & Tax Consultant (Querist)
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14 May 2023 Respected sir,

Thank you for the detailed clarification.

Hope, Sale of Jewellery comes under shall Capital Gains.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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14 May 2023 Yes, it's capital gains

Accounts & Tax Consultant

Accounts & Tax Consultant (Querist)
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17 May 2023 Thank you so much sir for your valuable advise !

It helps a lot for Practitioners like me.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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17 May 2023 You are welcome....
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