A company providing drilling service to E & P client ,whether entitled for the additional depreciation on its addition to plant & machinery?
Please note that the rate of deprectiation for such a company ( mineral oil concerns ) is 60% under Income Tax Act.
CA. Arun K. Aggarwal
Under section 32(iia) of the Income-tax Act,1961, additional depreciation at prescribed rate of 20% is allowed on any new plant or machinery, which has been put use after 31st March, 2005, by an assessee engaged in production or manufacturing of any article or thing.
It implies, such additional depreciation is not available for the company in question, which seems to be a service provider.
M N Rao & Associates LLP
Vijayawada
CA Inter
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Abic and Mani Chartered Accountants
Kottayam
B.Com
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CCI
Pro
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