s. 45(2) conversion of depreciable asset to stock in trade
This query is : Resolved
15 October 2008
what will be the tax implication of a depreciable asset been converted into stock in trade (eg offices held under fixed asset by a builder)?
Assuming that the block is not empty after conversion,
1.How will the same be adjusted in the block of asset?
2.How will the capital gain be computed ?
3.When will the capital gain be chargeable to tax ?
Assuming that the block is not empty after conversion,
1.How will the same be adjusted in the block of asset?
2.How will the capital gain be computed ?
3.When will the capital gain be chargeable to tax ?
16 October 2008
In such a case, my opinion to ur queries given under:
1. The same may be transferred at its market value to the block as on the date of conversion
2. Capital Gain whether STCG or LTCG shall be worked out at the time of actual sale. For this purpose the date and value of conversion shall be its date and cost of acquisition.
3. Capital Gain will be worked as in a normal case considering the date of conversion as its date of acquisition. There will not be any STCG u/s 50 on conversion as the entire value of coversion is to be adjusted in the value of the block.
1. The same may be transferred at its market value to the block as on the date of conversion
2. Capital Gain whether STCG or LTCG shall be worked out at the time of actual sale. For this purpose the date and value of conversion shall be its date and cost of acquisition.
3. Capital Gain will be worked as in a normal case considering the date of conversion as its date of acquisition. There will not be any STCG u/s 50 on conversion as the entire value of coversion is to be adjusted in the value of the block.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Clarification on GST, TDS, and Accounting Provisions for Import/Export Commission Agents,profes. ser
- GSTR9 Annual Return
- Employee secondment
- Ito add credit side of bank
- Rent agreement of House of deceased person
- LLP audit and disclosure
- Applicability of tax on invoice
- Capital gain on commercial property and investment in residential property
- Positive Balance in RCM Liability/ITC Statement – Commercial Rent RCM – Guidance Required
- Import of Capital Machine
- Closer of business and itc of capital goods
- Regime change
- Tally: Imported bank entries do not show up in manual reconciliation
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
- Resigning a auditor from the company for misconduct
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
- Need Professional Opinion - AY 2012-13 Old Demand & AY 2026-27 Refund Adjustment
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
