Whether a trust can claim depreciation?
This query is : Resolved
15 April 2015
Dear Sir,
Please tell me whether a trust can get a double deduction in fixed assets? First by claiming addition to fixed assets as income applied to charity and second by claiming depreciation on that asset again? Is this possible?
Thanks and Regards,
Nihal Joshi
Please tell me whether a trust can get a double deduction in fixed assets? First by claiming addition to fixed assets as income applied to charity and second by claiming depreciation on that asset again? Is this possible?
Thanks and Regards,
Nihal Joshi
15 April 2015
No. A trust can't claim depreciation on assets being claimed as 'applicaion'.
This was cubed by amending the IT Act in the Finance Act 2013.
This was cubed by amending the IT Act in the Finance Act 2013.
15 April 2015
Thank you sir but there are many cases in which double deduction was allowed, so can i use those case laws during appeal because the trust for which i am asking is in scrutiny for A.Y. 2012 - 13 and in Assessment Order depreciation was disallowed.?
15 April 2015
There are many case laws against also.
I.e, Lissie Medical Trust V/s CIT (Kerala HC). and many are there.
If at your High Court jurisdiction there is a case favorable to you, then you may use it for AY 2013-14 since it is before the amendment.
But if there is a decision in Supreme Court, then you have to treat the same as the final decision on it.
The amendment was prospective in nature.
I.e, Lissie Medical Trust V/s CIT (Kerala HC). and many are there.
If at your High Court jurisdiction there is a case favorable to you, then you may use it for AY 2013-14 since it is before the amendment.
But if there is a decision in Supreme Court, then you have to treat the same as the final decision on it.
The amendment was prospective in nature.
15 April 2015
Ok one more question. Suppose I have purchased Fixed Assets in A.Y. 2014 - 15 but i cant get double deduction. If i saw it as application of Income in A.Y. 2014 - 15 then can i claim depreciation in subsequent assessment years?
15 April 2015
No. You can't. If you have claimed it as 'Application of Income' at any time, you can not claim depreciation forever.
17 April 2015
Thank you so much John Sir
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