Depreciation

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Ramawatar Joshi (Querist)
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29 January 2008 A Partnership firm has been converted as pvt ltd company under chapter IX of the companies act, 1956 on 20th October 2007. How much depreciation will be allowed to partnership firm and company. As per Income Tax Act Depreciation is not allowed in the year of disposal/transfer of assets. Since Partnership Firm has been converted during the financial year 2007 - 2008 weather depreciation will be allowed to firm or not. As per Income Tax Act Depreciation to the Company should be allowed for half year as Company came into existiant only on 20.10.2007. It appears that only half depreciation will be allowed for financial year 2007 - 2008. Is it not a disadvantage on conversion. Plz reply catagorically stating each event with reasons.

R. A. Joshi

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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29 January 2008 This question was raised on 28th Jan 2008 and replied

Ramawatar Joshi

Ramawatar Joshi (Querist)
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01 February 2008 Proper and full reply was not given. we have reset the query. Please reply again covering all points.
Thanks
R.A.Joshi

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Sanjeev Kumar Sharma

Sanjeev Kumar Sharma (Expert)
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01 March 2008 hello dear

i have to say that conversion of partnership firm into company is not a disposal/transfere of assets, so for the depreciation point of view fo partnership firm, u could charged the depreciation in partneship firm