Treatment of capital subsidy
This query is : Resolved
Vijender Bisht
(Querist)
21 April 2015
A company purchased a fixed asset as on 01.04.2012 for Rs.10.00 Crore against which a subsidy of 40% is receivable from Government. Subsidy received by the company on 10.11.2014.
When company should reduce the value of subsidy from its fixed asset i.e in FY 2012-13 or in FY 2014-15
Please reply with decided case law or respective section of income tax, if any
When company should reduce the value of subsidy from its fixed asset i.e in FY 2012-13 or in FY 2014-15
Please reply with decided case law or respective section of income tax, if any
CA Mohit Bansal
(Expert)
21 April 2015
The amount of subsidy should be reduced from the WDV of the asset in the year of receipt of subsidy. The depreciation would be chargeable on the revised WDV
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