143(1)
This query is : Resolved
14 December 2015
a intimation received which shows a demand due to cancellation of all amount of depreciation bcoz a mismatch apperent from record. Person shoews two head of 15% dep like tractor head separate and machinery head separate.
if we rectified online refund can be made.
But problem is that tractor is sold by assessee in the year of demand and its loss is shown in the capital account
if we change the depreciation schedule and merge both machinery and tractor account. then depreciation shown at correct amount but capital account also changed.
and next year capital opening also changed.
plz give me a view and why we shows loss in capital account debit side whether its a planning. IF THERE IS PLANNING PLZ TELL ME SOMETHING ABOUT IT.
CA AMIT DHINGRA
8059302118
if we rectified online refund can be made.
But problem is that tractor is sold by assessee in the year of demand and its loss is shown in the capital account
if we change the depreciation schedule and merge both machinery and tractor account. then depreciation shown at correct amount but capital account also changed.
and next year capital opening also changed.
plz give me a view and why we shows loss in capital account debit side whether its a planning. IF THERE IS PLANNING PLZ TELL ME SOMETHING ABOUT IT.
CA AMIT DHINGRA
8059302118
14 December 2015
As I could understand from the query, you are advised to treat the block of 15% as a single block instead of 2 separate blocks while making the Computation of Income vis-s vis for calculating Depreciation as per the Income Tax Act 1961.
.
Depreciation as per IT Act is a separate calculation than the Depreciation as being shown in the Books of the assessee.
.
So while furnishing the book results, we can show depreciation as per Books of accounts in P&L A/c and accordingly show the Fixed Assets in the Balance Sheet at the WDV (arrived after providing the Depreciation as shown in P&L A/c).
.
You can have two different WDVs = one as per IT Act and another as per Books.
.
.
Depreciation as per IT Act is a separate calculation than the Depreciation as being shown in the Books of the assessee.
.
So while furnishing the book results, we can show depreciation as per Books of accounts in P&L A/c and accordingly show the Fixed Assets in the Balance Sheet at the WDV (arrived after providing the Depreciation as shown in P&L A/c).
.
You can have two different WDVs = one as per IT Act and another as per Books.
.
14 December 2015
sir I agree with u, but problem is different
ALL INFORMATION GIVEN ABOVE IS AS PER AUDITED BALANCESHEET AND P&L ACCOUNT.
IF I WILL CHANGE DEP IN THE CORRECT WAY THEN INSTEAD OF DEMAND U/S 143(1). REFUND WILL MADE. BUT IN THE AUDITED BALANCESHEET LOSS ON SALE OF TRACTOR IS SHOWN.
SO PROFIT ISSUE IS CORRECTLY SETTLE DOWN BUT HOW I CAN CHANGE THE CAPITAL ACCOUNT OF AUDITED BALANCE SHEET WHERE THEY SHOWN LOSS
ALL INFORMATION GIVEN ABOVE IS AS PER AUDITED BALANCESHEET AND P&L ACCOUNT.
IF I WILL CHANGE DEP IN THE CORRECT WAY THEN INSTEAD OF DEMAND U/S 143(1). REFUND WILL MADE. BUT IN THE AUDITED BALANCESHEET LOSS ON SALE OF TRACTOR IS SHOWN.
SO PROFIT ISSUE IS CORRECTLY SETTLE DOWN BUT HOW I CAN CHANGE THE CAPITAL ACCOUNT OF AUDITED BALANCE SHEET WHERE THEY SHOWN LOSS
14 December 2015
First of all, you are not required to change your audited balance sheet as all the data furnished are correct in your opinion.
.
You are required to make change in the computation part only.
.
.
You are required to make change in the computation part only.
.
14 December 2015
SIR EXTRACT OF THE CASE IN TABULAR FORM ARE-
PARTNERSHIP FIRM-
AUDITED P&L DEP= 23921
CAPITAL A/C OF BOTH PARTNER -30241(APP) LOSS ON DEBIT SIDE
AND DEP SCHEDULE-
1. MACHINERY 15%
2. TRACTOR 15% BUT SOLD AT LOSS DURING THE YEAR
AS PER INTIMATION THEY CANCEL ALL DEP AND MAKE ADDITIN OF 23921/- DEP.
AS PER ME CORRECT DEP IF CONSIDER REFUND WILL COME BUT HOW I SHOW CAPITAL A/C IN RECTFIED RETURN AND FOR FUTURE YEARS CASE IS OF AY 2009-10
PARTNERSHIP FIRM-
AUDITED P&L DEP= 23921
CAPITAL A/C OF BOTH PARTNER -30241(APP) LOSS ON DEBIT SIDE
AND DEP SCHEDULE-
1. MACHINERY 15%
2. TRACTOR 15% BUT SOLD AT LOSS DURING THE YEAR
AS PER INTIMATION THEY CANCEL ALL DEP AND MAKE ADDITIN OF 23921/- DEP.
AS PER ME CORRECT DEP IF CONSIDER REFUND WILL COME BUT HOW I SHOW CAPITAL A/C IN RECTFIED RETURN AND FOR FUTURE YEARS CASE IS OF AY 2009-10
14 December 2015
1. You need not to change capital accounts.
.
2. You modify computation in the following manner-
Net Profit as per P&L A/c (Say) 50000
Add: Depreciation as per Books 23921
Add: Interest & Remuneration to Ps 25000
.
Less:Interest & Remuneration to Ps -25000
Less:Depreciation as per IT ACT -40000
(Depreciation on Total of (P&M and
Tractor) Less Sales Consideration)
.
Net Profit of the Firm 33921
.
In depreciation Schedule DPM show total value of P&M+Tractor. Deduct Consideration received on sale of Tractor and charge depreciation on the WDV @ 15% (assuming no addition during the year).
.
.
2. You modify computation in the following manner-
Net Profit as per P&L A/c (Say) 50000
Add: Depreciation as per Books 23921
Add: Interest & Remuneration to Ps 25000
.
Less:Interest & Remuneration to Ps -25000
Less:Depreciation as per IT ACT -40000
(Depreciation on Total of (P&M and
Tractor) Less Sales Consideration)
.
Net Profit of the Firm 33921
.
In depreciation Schedule DPM show total value of P&M+Tractor. Deduct Consideration received on sale of Tractor and charge depreciation on the WDV @ 15% (assuming no addition during the year).
.
14 December 2015
THANKS SIR
BUT IT DEPTT OBJECTION RAISE TO NAHI KAREGA BCOZ AFTER RECTIFIED RETURN CAPITAL ALSO CHANGED IN 2009-10 AY .AND NEXT ALL AY KE RETRUN WITH AUDITED BALANCE SHEET FILE HO CHUKKE HAI
BUT IT DEPTT OBJECTION RAISE TO NAHI KAREGA BCOZ AFTER RECTIFIED RETURN CAPITAL ALSO CHANGED IN 2009-10 AY .AND NEXT ALL AY KE RETRUN WITH AUDITED BALANCE SHEET FILE HO CHUKKE HAI
14 December 2015
1. First of all think about IT matter and not about the Audited Balance Sheets of the Assessee Firm filed so far.
.
2. No depreciation is claimed on a asset (Tractor) in the year of its sale. I can thus assume that you have calculated depreciation only on the P&M and that is of Rs 23621/-.
.
However, when the tractor is sold at loss, naturally its inclusion and deletion in the gross block of 15% increases the WDV in the subsequent years also, thereby enhancing the amount of depreciation claim. Revenue is going nothing to loss in such a situation. So, there will be hardly any objection from the revenue's side.
.
You can recompute the WDV as on 31.03.2015 and substitute the same for the purpose of calculation of Depreciation only. This can be managed by showing the difference of WDV as an addition in the block in the beginning of the year.
.
You need not to disturb Financial Data/ Books of the assessee. They have nothing to get by dealing with the same.
.
.
2. No depreciation is claimed on a asset (Tractor) in the year of its sale. I can thus assume that you have calculated depreciation only on the P&M and that is of Rs 23621/-.
.
However, when the tractor is sold at loss, naturally its inclusion and deletion in the gross block of 15% increases the WDV in the subsequent years also, thereby enhancing the amount of depreciation claim. Revenue is going nothing to loss in such a situation. So, there will be hardly any objection from the revenue's side.
.
You can recompute the WDV as on 31.03.2015 and substitute the same for the purpose of calculation of Depreciation only. This can be managed by showing the difference of WDV as an addition in the block in the beginning of the year.
.
You need not to disturb Financial Data/ Books of the assessee. They have nothing to get by dealing with the same.
.
14 December 2015
I TOTALLY AGREE , THATS WAS THE SITUATION.
BUT SIR NEXT YEARS OPENING WDV ALSO CHANGED FROM 2010-11 TO 2015-16
HOW IT CAN CORRECLY SHOWN RETURN HAS BEEN FILLED OF THESE YEARS
BUT SIR NEXT YEARS OPENING WDV ALSO CHANGED FROM 2010-11 TO 2015-16
HOW IT CAN CORRECLY SHOWN RETURN HAS BEEN FILLED OF THESE YEARS
14 December 2015
I have already replied this issue.
.
.
14 December 2015
resolved and thanks sir for your precious time for my query
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Refund of AY 22-23
- HSN Details in IFF/GSTR-1 & in GSTR 9
- Tax on capital gains revoked us 54f
- Should I include march foreign salary received in April in my income for FY 2023-24?
- TDR receipts for agreement holder
- Inventory of finished goods
- Filing of Form 10BB instead of Filing Form 10B
- Company Incorporation - CA and directors signing from different states
- Clarification on Documentation of Paid-Up Capital Contribution by Directors
- Confusion around Form 26QB fields
- Intimation wrongly states taxpayer has offerred u/s. 44ad & states probable resolutiton to do audit
- Refund AY 2012-13 and 2013-14
- DIRECT TAX CODE 2025
- MODEL FILLED AUDIT REPORT FOR TRUSTS IN FORM 10B
- 115TD on cancellation of 12A 80G Registration
- MIS MATCH OF INVOICE NUMBER
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
Trending Online Classes
CAclubindia
