Depre under co & IT Act

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 June 2011 Guide me if depre to be provided on asset purchased on 31st March 2011(Evening) i.e. last date of F.Y.under companies act ? because if we record it as additions after sept in IT ACT Depr Shedule we will get half year depre as against 1 day in companies act which will affect deferred tax liability working..

Vivek Mehta (CA, DISA,CS, MBA)

Vivek Mehta (CA, DISA,CS, MBA) (Expert)
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16 June 2011 Yes that will affect the deffered tax liability working

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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17 June 2011 Depreciation depends on the assets put to use and not the date of purchase. If the assets have been put to use on 31.3.2011 then as per I.T you can take the advante of 50% of the rate of depreciation but if it is not put to use then no depreciation can be charged.

As you have stated that the assets was purchased on 31.3.2011 in the evening this means after the office hours and the assets was not put to use during the year and hence you can avoid the charging of depreciation in your books. Request your auditor to pur a note that assets purchased for Rs..... has not been pur to use during the year and hence no depreciation has been charged.

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