WDV Value to be taken in the case of Amalgamation

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CA Ankit Zaveri (Querist)

19 June 2009 Our company merge with two companies. We acquire all the assets of the transferor co's including immovable properties. The transferor co's had not taken/shown depreciation as per income tax act in the IT return filed by them till date. The nature of business of the transferor co's is renting of immovable properties the income from which was consider under income from house property in the IT return filed by them till date. My question is what is the value of the immovable property we have to take while calculating the depreciation as per income tax act after merger.

CA.SHAHZAD SAYYED

CA.SHAHZAD SAYYED (Expert)

19 June 2009 Respected Ankit sir
few days ago i read the circular issued by CBDT that in case of Assets on which depreciation were not taken may be due to Assessee's income was exempt or he was using asset for which no depreciation was allowed but when such assessee become liable for tax then he has to Calculate the NOTIONAL DEPRECIATION till date of he is liable for depreciation
NOW in ur case since before merger assessee was assessed under HP income so no depreciation was taken by him, now your company has to take notional depreciton till date of transfer and charge the depreciation on deemed closing WDV for Current year dep