our manufacturing process has been temporarily shut down due to natural calamity that is tsunami and hence the business operation was discontinued during the year. We have charged depreciation on fixed assets in the books of accounts;is this depreciation allowable under the Income Tax Act??????
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treatment of depreciation on shut down of business
Replies (5)
An assessee can claim depriciation if
he is owner of the capital asset and
the asset is used for business purpose
In your case if asset is used for any part of the year then depriciation can be allowable, however it depends upon AO to allow depriciation.
Depreciation on assets can be claimed by the assessee if:
He is the owner of the asset during the relevant previous year.
Ans such asset was used for the purpose of business during the relevant previous year.
Since you have used the asset, you are entitled to claim the depreciation. But the amount of depreciation should be calculated as per the rates prescribed in the Act.
I think once Asset is Put to Use thereafter u will get Deprecion for number of Years to Come. Even in case of Shutdown of Plant itself, Ur Machine deemed to be Depreciated...
So u can Claim Depreciation for Full year
yes , depreciation can be claimed .
yes , depreciation can be claimed .
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