17 August 2010
In case of expenditure on leased premises in order to make it fit for assessee’s business, if any extra facility was created by way of brick works and connected expenditure, the same would be a capital expenditure eligible for depreciation under explanation 1 to section 32(1) and if not, the expenditure would be revenue in nature covered by section 30(a)(ii). Dy. CIT vs. EDS Electronic Data Systems (India) (P) Ltd. (2009) 23 DTR 10 (Del.) (Trib.)
17 August 2010
If these expenses (decoration etc) are in the nature of fixtures, then it should be capitalized & to be written off over the current lease period.
But, if these exp are purely in the nature of maintenance etc then it should be debited to PL A/c.
Querist :
Anonymous
Querist :
Anonymous
(Querist)
17 August 2010
BUT IF BUILDING IN BOOKS, THEN CAN BE CAPITALIZED,
WHAT IS CRITERIA,\
I MEAN " KYA HOTA TOH CAPITALIZED HOTA"
Querist :
Anonymous
Querist :
Anonymous
(Querist)
17 August 2010
ANOTHER QUESTION -
WHEN MOTOR CAR PURCHASED, THERE IS INSURANCE CHARGES, ROAD TAX, REGISTARTION CHARGES AND SAY PROCESSING OF LOAN CHARGES,
17 August 2010
If the expenses are in the nature of fixtures like blinds / false ceiling / tiles / decorative electrical fittings , then it should be capitalized & to be written off over the current lease period.
17 August 2010
in the case of motor car, the whole amount is to be capitalized.
Querist :
Anonymous
Querist :
Anonymous
(Querist)
17 August 2010
JHAJI, U MEAN CAR INSURANCE CHARGES PAID, ROAD TAX PAID, WHICH ARE FOR CERTAIN LIFE LIKE INSURANCE FOR 1 YEAR, ROAD TAX FOR 5 YEAR THEN THESE ALSO TO BE CAPITALIZED,
17 August 2010
They are treated as expenses incurred for bringing the assets to its intended use as the car cannot leave the showroom without insurance and hence capitalised.