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additional depreciation

05 December 2010

can i claim addtional depreciation on new plant & machinery engaged in the business of the embroidery job work on sarees?

Whether it is in the definition in manufacture or not?

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8 Replies

Gokul Viswanath Shenoy (Company Secretary & Finance Manager) (430 Points)
Replied 05 December 2010

i think doing embroidery works doesnt amounts to manufacture..not v.sure..manufacture means changing the input material into a new object or thing..you are not creating a new product/object by doing embroidery work on the textile or some object..so,you wont be able to claim additional depreciation on the asset used for embroidery work.

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Sunali (Learner) (1317 Points)
Replied 05 December 2010

Agree with Mr. Gokul.

Since According to Sec 2 (29BA) of Income tax act

manufacture, with its grammatical variations, means a change in a non-living physical object or article or thing,

(a) resulting in transformation of the object or article or thing into a new and distinct object or article or thing having a different name, character and use; or

(b) bringing into existence of a new and distinct object or article or thing with a different chemical composition or integral structure;

HENCE, IN MY OPINION, THE ABOVE PROCESS IS NOT MANUFACTURE BUT JOB WORK.

CA PRAKASH M KHATRI (PRACTISING) (35 Points)
Replied 05 December 2010

sunali is correct..............

1 Like

(Guest)

ya agree with gokul.. but not sure

CA Deepesh Ruhela (Keen to Learn) (3271 Points)
Replied 05 December 2010

Agree with Sunali..

1 Like

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Pawan Kr. Tomar (CA) (169 Points)
Replied 06 December 2010

Additional depreciation is available for manufacturing units. Embroidery work is not covered under manufacture.

Rajesh (Articled Clerk) (50 Points)
Replied 06 December 2010

Manufacture happens only when there is a change in utility and altogether different name is given. Embroidery work is thus not a manufacture

VAMSI ASSOCIATES/S.PHANI RAJ (Advocate & Tax Consultant) (499 Points)
Replied 07 December 2010

yes

sunali says is correct. because the additional depreciation is calculated only its amounts to manufacturing. now embroidery is not a manufacturing activity. hence additional depreciation is not taken.

regards

s.phani raja kumar

advocate & tax consultant