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Capital Gains & Block of Asset Concept

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(Querist)
30 December 2008 15 % Machinery Block on 20th June 2008 - Rs. 1.90 lacs
The Block comprises only a Car.

The Car is sold for Rs. 4.00 lacs on 21 st june 2008.

A new car is purchased on 20th August 2008 for Rs. 7.00 lacs.

My queries are

1. What is the balance of the 15% Block as on 31st march 2009 before depreciation?

2. Whether capital gains tax arises or not?

3. How is the profit on sale of car is taxed here?

Please solve my queries.
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Bhaskaran Chackrapani Warrier

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Bhaskaran Chackrapani Warrier (Expert)
30 December 2008 1. 4.90 lakhs.
2. No.
3. No profit on sale of car in this situation to be taxed.
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CA Chaitanya

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CA Chaitanya (Expert)
30 December 2008 Yes it is correct.
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CA Tilak Raj Sharma

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CA Tilak Raj Sharma (Expert)
31 December 2008 1. Balance 4.90 and after dep. 4.165
2. No.
3. No profit on sale is taxable while calculating income tax liability.
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CA. Arul Mozhi Varman

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CA. Arul Mozhi Varman (Querist)
31 December 2008 Thanks everybody.

Therefore, Block of Asset Concept saves a lot of tax.

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