Doubt

Depreciation allowance means depreciation is allowable as an expense in the income tax act 1961.

Depreciation is allowable only to the owner of the asset. Asset must be used for the purpose of business or profession.

Depreciation under Income Tax Act is different from that of Companies Act, 1956. Therefore depreciation rates prescribed under

income tax is only allowable whatever the depreciation is charged in books of accounts.

If there are some spare parts/machines and they are not actually used, depreciation is allowable on them because they are used for purpose of business/profession.

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Piyush Tanwar

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