Dear Friends
A company purchase a machinery used for manufacturing . Tell me whether increase in installed capacity is neessary for charging additional depreciation or not.
1 Replies
Siddarth R Sunder Ram
(Finance Professional)
(230 Points)
Replied 17 June 2010
As per section 32 of the income tax act, additional depreciation to the extent of 20% of the actual cost can be claimed in respect of any plant and machinery purchased on or after 31/3/05, if the assessee is engaged in manufacture/production of any article or thing. There is no requirement of an increase in installed capacity.
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