Depreciation loss under income from other sources

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 September 2012 Can a Depreciation Loss under the head income from other sources be allowed to be carried forward next year & set off or only Depreciation Loss under the head Business Income be allowed to be carried forward next year & set off. Logically The Depreciation loss under the head Income From other sources be allowed to be C/f as the Depreciation under the head income from other sources refers to sec 32.

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Pankaj Gupta

Pankaj Gupta (Expert)
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18 September 2012 Depreciation is an expense which arises in course of business only. And therefore it is allowed as expense from business income only. How can you depreciate anything under the head other sources.

K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)
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19 September 2012 Mr Pankaj is correct.

There is no way under which you can claim depreciation under Income from other sources.

Depreciation, by its very nature, arises only in Business or profession head.

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Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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19 September 2012 In case of composite letting of machinery plant etc, income has to be offered under the head 'income from other sources' as per section 56(2) (iii) and in such cases depreciation can be claimed as a deduction as per section 57(ii) while computing income from other sources.
If the end result of the above said computation is negative due to the element of depreciation it can be carried forward and set off against the income of next year under the head 'income from other sources' vide 57(ii) of the Income tax Act,1961.

K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)
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19 September 2012 ChakrapaniWarrier sir,

Thanks for the explanation.

Now i understand the possibility of claiming depreciation under Income from other sources

What is the carry forward period in case the income form letting out machinery is negative after depreciation or when the depreciation is unabsorbed?