Depreciation on Land And Building

This query is : Resolved

Guest

Guest (Querist)

18 December 2010 A Company purchased a building. Agreement for purchase does not include a separate value for Building and for land on which it is constructed. Only one combined value is mentioned in the agreement. Now my query is that,for income tax purpose, on what amount i should claim a depreciation? on total agreement value or on only the value on building and not land? if only on value on building, then how will i bifurcate the value of land and building?

is there any case law for the same?

CA Ayush Agarwal

CA Ayush Agarwal (Expert)
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18 December 2010 As per decision in CIT vs Rajesh Exports Ltd 9 SOT 28(Bangalore) In case of a composit agreement for pur of land & building where seperate distinction can't be made about the price of each, dep is admissible on whole consideration.