13 October 2013
Can any one say me. What is criteria for not charging depreciation on building, whereas building is an depreciable item and AO will charge depreciation whether assesee charges or not.
If assesse charges depreciation on building then it will be STCG u/s 50 otherwise LT on sale of building and consequent
ly it will be exempt. assessed is company so u have to keep in companies Act also.
Depreciation should be charged on office building in accordance with sec 32 of income tax Act at the rate of 10% on WDV.
Even if u dont charge depreciation on building it will deemed to have been allowed and WDV will be reduced by the amount of dep.
There is no provision in Income tax Act to charge dep on land and u cannot charge dep on land in income tax Act. Even if u charge the same it will be disallowed while calculating income under head business/profession.
The above provisions of IT Act has nothing to do with how u charge depreciation in accounts.
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