MAT on let out property

 

Dear Friends
 
A Pvt Ltd company whose only source of income is from letting out of property and claiming deduction u/s 24 as per IT act and also interest on borrowed capital benefit.
 
Further as per MAT the tax payable is more .
 
Now my query is that while calculating MAT can we claim depreciation as per Companies act on this property which is let out or is there specific restriction to it.
 
Further after 5 years if we were sell this property can we claim indexation benefits as we are not claiming deprecciation as per income tax. what we are claiming is only depreciation as per company act.
 
An early reply shall be highly appreciated with supporting case laws prefrably
 
Regards,
CA Rajesh Poddar
 
 
Replies (2)
Sir, As per my opinion, 1)115JB talks about book profit as increased by dep charged only on revaluation of asset.and it employs the word 'depreciation debited in P&L other than on revaulation.so depreciation will be reduced from book profit. 2)Since s.50 computation of capital gain talks abot depreciable assets,mean only allowable depreciation under B&P.not HP.so indexation benefit will be allowable. -Regards

Rajesh, MAT is just a alternative way to calculate the tax and therby do not overrule income tax act.

so while calculating MAT you have to provide depreciation as per companies act and at the same time you will be eligible to Indexatin benefit.

 

Regards

Piyush

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