Construction cost of chimney

You have to give more information:

1. whether the amount was paid by cheque.

2.Is the client an individual, firm or company? is Audit applicable?

3. The chimney is constructed on the residential house or factory?

Madhavi ji,

1.The amount was paid in cash.

2.The client is a private limited company and yes Audit is applicable.

3.The chimney is constructed on a hotel which is the main busuiness premises of the client.

Waiting for your reply..

In my view show the chimney as a revenue expenditure (repairs)as there is no supporting evidence and then disallow it while calculaing tax. If you show it as addition to hotel building( which is actually correct) there is no provision to disallow depreciation.

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