Deprecation during pre-construction

This query is : Resolved

Sanchit Jain (Querist)
Follow

17 August 2010 A new company is being incorporated for setting up a power project. The company apart from land and other civil work which are shown as CWIP also purchases certain assets like computer, furniture, etc. on which depreciation is provided under Companies Act and capitalsed as pre-operative expenditure pending allocation.

Should we claim depreciation under Income Tax Act also as the assets (computer, etc.) have been put to use or should we wait till the commencement of project?

Aditya Maheshwari

Aditya Maheshwari (Expert)
Follow

17 August 2010 If the assets are being put to use then depreciation as per Income Tax allowable otherwise not.

Also i think the WDV as per I. T. Act will be the carrying value of asset for Income tax purpose and future depreciation.

Sanchit Jain

Sanchit Jain (Querist)
Follow

17 August 2010 Thnx for the reply..
So we should claim depreciation and carry forward the depreciation loss..

Aditya Maheshwari

Aditya Maheshwari (Expert)
Follow

17 August 2010 yes if assets put to use.

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
Follow

17 August 2010 YOU SHOULD CLAIM DEPRECIATION ON ASSET AS PER IT ACT AND MAKE DEFFERED TAX ASSET AGAISNT IT.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join the CA Students WhatsApp Community for ICAI Updates, Trending Courses & Notes!

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

S J MITRA

prakash takane

Chnmaya parhi

CA Aakarsh Jain

tsrandcompany@gmail.com

Subscribe Now

Deprecation during pre-construction

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Senior Executive

Manager- Finance and Compliance

GST CONSULTANT

GST CONSULTANCY

Accountant

CA Final

Article Assistant

Associate CA