Depreciation

This query is : Resolved

UBEIDULLA (Querist)
Follow

17 September 2019 If the machinery was not put to use throughout the year can we stop claiming depreciation during the year? Can the experts explain please?

CA Guru Manohar

CA Guru Manohar (Expert)
Follow

17 September 2019 No, Partially Yes.

As per companies act, Schedule II

You can charge depreciation for an asset over its useful life, Here useful life is which an asset is expected to be available for use by an entity. so irrespective of put to use status you can charge depreciation in books of accounts.

http://www.mca.gov.in/SearchableActs/Schedule2.htm

As per Income tax act

But as per Sec 32, You can charge depreciation of an asset only for the period of Put to use.

the logic behind in taxation is you can claim depreciation exp only for the period you have been used the asset for business purpose and generate revenue from the usage.