How is depreciation calculated here?

Hello,

For accounting purpose,as per company act,depreciation will be for 3 years and 9 months that is period of asset was put to use.That  means in the year of tranfer depreciation will be charged for 9 months in the book of "B".

However for Incometax purpose depreciation will be for 3 years as asset is sold by "B" in 4th year it will bededucted from "Block of Asset" in case of "B" in 4th year . 

-reply modified

Hi,

Per Accounting laws, depreciation will be for 3yr9mts. However, for Income tax purpose, under the 'Block of Assets' concept, there would not be any depreciation for the 9mts period and therefore, this would be Short Term Capital Gains/ Loss, as the case will be.

Cheers

Yuvak

Thank you so much Mr. Yuvak and Mr. Shah. Thats exactly what i needed.