STCG

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 February 2010 Hi
in a company one vehicle is sold for more than its book value ( book value Rs150000/- sold for Rs200000/- ) but the same block having balance. my question is the profit earned Rs 50000/- is taxable as STCG or Income under the head Business income.

CA Shishir

CA Shishir (Expert)
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04 February 2010 It is taxed as Capital Gain (Short Term)

CA RAMESH KUMAR AHUJA

CA RAMESH KUMAR AHUJA (Expert)
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04 February 2010 In case of a Company, Book Value and WDV as per Income Tax Chart may differ. In a situation where there is no other asset in the block and sale value is more than the WDV as per I.Tax Chart, the surplus is to be offered as STCG.

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Querist : Anonymous

Querist : Anonymous (Querist)

04 February 2010 Thanks for reply.
In my case vehicle has been sold more than the WDV but the blok is not empty ( as per IT Shedule of assets ). As i read in some book the block is not empty then the profit arising from the sale of assets should be treeted as business income. Is it correct or not ?

CA RAMESH KUMAR AHUJA

CA RAMESH KUMAR AHUJA (Expert)
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04 February 2010 As per Co Act, profit on sale of fixed asset is to booked seperately while for the purpose of claiming depreciation under Income tax Act, profit is adjustable in the Block. However, if there is no asset in the block except the one being sold then the sale value in excess of the WDV of the block will be treated as STCG.

Querist : Anonymous

Querist : Anonymous (Querist)

04 February 2010 so in my case profit arising from sale of vehicle should be treeted as business income because there is many vehicle in the same block ( or WDV is not nill in the same block ). And i am asking only about treetment under IT act, pls advise