Depreciation on new building purchase

Others 310 views 7 replies

Harikrushna jajal

Accountant

108 Points Joined May 2011

Option -1:

A company want to acquire Building , for which company has paid 10% of total value of building as banakhat. however remaining 90% payment will be made at the time of registration i.e. making dastavege which will be made on 6th of october.

Option-2

A company want to acquire Building , for which company has paid 10% of total value of building as banakhat. however remaining 90% payment will be made on on before 1st october.The registration i.e. dastavege in this case also will be made on 6th of october.

In above both option whether company can claim full depreciation or depreciation at half rate?

Replies (7)

Mukesh Kumar

Accounts Manager

1466 Points Joined August 2013

DEPT CALCULATE ON THE BASIS OF REGISTRATION DATE ,

IF REGISTRATION DATE BEFORE 1 OCT THEN YOU CAN CLAIM FULL DEPT

OTHERWISE CAN CLAIM HALF DEPT

NOTE : BUILDING MUST BE IN USE

Harikrushna jajal

Accountant

108 Points Joined May 2011

Eventhough full payment made, only legal formalities pending i.e. company has right to use building before october as full payment made only regtistration elayed, can compny claim full depreciation?

Mukesh Kumar

Accounts Manager

1466 Points Joined August 2013

GOOD HARIKRUSHNA SIR

BUT I THINK BEFORR THE DATE OF REGISTRATION ,

IN GOVT RECORD YOU ARE NOT OWNER OF BUILDING ,

AND BEFORE THE REGISTRATION THE PAYMENT MAY BE AS ADVNCE PAYMENT

SIR , I THINK A.O. CHECK THE DATE OF REGISTRATION AND AQUIRED DATE FOR CROSS CHECK WITH CLAIMED DEPT .

CA Saba Naaz

Chartered Accountant

8487 Points Joined August 2010

Possession and usage of the asset is required to claim full depreciation. Legal formalities are not so material here.

CA Saba Naaz

Chartered Accountant

8487 Points Joined August 2010

See whether ownership is there or not.

CA shanky pahoja

accountant

615 Points Joined December 2015

as per the Act deperciation can be claimed if the asset it is put to use so in substance if possesion is transfered, depreciation can be claimed, registration is not important.

there is also a judgement of high court to support t6his.