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Fixed asset purchased in cash

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CA Final Student
120 Points Posted on 03 September 2020
what is the treatment of adjustment:- if fixed asset puchased in cash under the head PGBP?

1) payment up to 10,000 in cash
2) payment more that 10,000 in cash
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On 03 September 2020 at 16:05 Report
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Profession Business
28207 Points Posted on 03 September 2020
It is recommended not to apply cash in fixed asset.
44 Reply
On 03 September 2020 at 16:21
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CA Final Student
120 Points Posted on 03 September 2020
Thanks, I know but what is the treatment after that?
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On 03 September 2020 at 16:25
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Profession Business
28207 Points Posted on 03 September 2020
Fixed asset is a capital expenditure.
capitalize the cost.
enter it in fixed asset register and charge depreciation as per the rates applicable in schedule 3.
avail credit for gst as input igst or cgst as the case may be.
44 Reply
On 03 September 2020 at 18:33
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Tax and Business Consultant
11616 Points Posted on 03 September 2020
1. Payment up to 10,000 in Cash, capitalised and claim depreciation.
2. Payment more than 10,000 in cash _ can't claim depreciation u/s 32 and and can't add cash amount in cost of fixed assets as per section 43 of IT act, 1961
66 Reply
On 03 September 2020 at 18:41
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209 Points Posted on 03 September 2020
For 1 st case normally apply depreciation in 2 nd case it is disallowed to pay more than 10000 in cash in single transaction if is possible to bifurcate the amount than do that otherwise ypu wont be able to claim dep on that amount
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On 03 September 2020 at 21:16
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Profession Business
28207 Points Posted on 04 September 2020
I am quite aware of the relevant sections SEC 40 A (3).
Disallowance of expenditure in respect of expenses incurred for fixed asset .
Like claiming depreciation benefit while computing income from business and profession is not asked for.
It's a wide subject.
44 Reply
On 04 September 2020 at 07:31


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