hi
depreciation is provided on ornaments or not. The ornaments are in the name of company and it gives on rent basis.?
if yes then @ what rate.?
Karan S Shah (Article) (36 Points)
02 July 2010hi
depreciation is provided on ornaments or not. The ornaments are in the name of company and it gives on rent basis.?
if yes then @ what rate.?
CA Amit Kanani
(Practicing CA)
(338 Points)
Replied 02 July 2010
No, dep. on ornament. Under companies act, nothing is specified so, not allowed. Under income tax act also no dep. shall allowed.
Muskan
(AM)
(22 Points)
Replied 03 July 2010
Dear all i think depreciation is allowed as ornaments are used for business purpose.
may be default rate allowed for the same or can be cllasified under any specific head according to nature of the business.......Just go through the companies act as well as income tax.....
CA Amit Kanani
(Practicing CA)
(338 Points)
Replied 06 July 2010
Dear Muskan,
Ornaments is given on Rent it's not use for business purpose and Dep. schedule specified in Compnies act and IT act is very Specific and its not allow dep. on ornament in ANYYYYYY CASE.
CA.Mini
(CHARTERED ACCOUNTANT)
(336 Points)
Replied 11 July 2010
is ornaments a primary productive yield earning item in business.whats the nature of business carried on by the company.? since what the company earns is an incidental income on letting out ornaments and it is better to show ornaments as investments rather than fixed asset.hence the depreciation need not be claimed.
Amir
(Learner)
(4016 Points)
Replied 12 July 2010
Hi Friends,
I wanna go with Muskan's reply in view of the following, provided second condition of limited life also gets fulfilled -
Para 3.2 of AS-6 -
Depreciable assets are assets which
(i) are expected to be used during more than one accounting period; and
(ii) have a limited useful life; and
(iii) are held by an enterprise for use in the production or supply of goods and services, for rental to others, or for administrative purposes and not for the purpose of sale in the ordinary course of business.
Ca Aashish Upadhyay
(CONSULTANTS)
(913 Points)
Replied 14 July 2010
Me too with Amir! Assests are producing Income. The companies act does not limit the assests based on its types. The rate of depreciation is also calcuated on the basis of useful life of the assests.
CA PuRvI M!$rA
(-)
(2260 Points)
Replied 15 July 2010
Originally posted by : Kumar | ||
Ornaments are non depreciable assets... |
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