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depreciation

ANAND U PATANKAR (CHARTERED ACCOUNTANT) (68 Points)

20 March 2009

Dear All,

Please clarify whether depreciation on vehicle in the name of a director of a company is allowable under section 32 if it is used for both business and personal purpose

Anand

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8 Replies

Abhinav Agarwal (M.Com C.A SAP Consultant) (814 Points)
Replied 20 March 2009

You can't claim depreciation in the books of company for director's personal vehicle.

However, if you take an undertaking from that director & company that such vehicle will be wholely used by company for official purpose, Dep can be claimed, considering consideration & TDS provisions.

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Atul Kumar (CA) (504 Points)
Replied 24 April 2009

Depreciation can't be calimed by the company unless it is capitalised in the bokks of company.

Rupesh Jha (M.Com CA PhD* and MBA*) (1116 Points)
Replied 24 April 2009

YES ATUL IS RIGHT.

vijay (.) (212 Points)
Replied 26 April 2009

Mr. Anand

If the Car is shown in the books under the head Fixed Assets then you have to claim depreciation at is compulsory to claim depreciation.

Regards

Vijay Kumar

deepak K Gujrati (CA-practice) (966 Points)
Replied 26 April 2009

If the car is capitalised in the books of the company, [ hope the payment has been made by the company and name of the company is also mentioned on the invoice ] the company will claim depreciation and it will be an allwable expense even if it is partly used for personal purposes also.

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M.M.SURANA (Director -Taxation ) (532 Points)
Replied 02 May 2009

If V go as per Mr. Deepak and as per term of agreement between company and the director dep. can be claimed adn further FBT will be calculated.

CA Akhilesh Mundra (Chartered Accountant) (76 Points)
Replied 03 May 2009

No, company can't claim the depreciation. The same is held in various case law held by the different authorities

Seetha (B.Com, CA) (278 Points)
Replied 03 May 2009

Dear sirs,

if suppose the above mentioned person has a personal business apart from being director of a company; and he transfers the car which he was using for his personal business and his personal use to the company the will capital gain be applicable ( as car is personal effect)?

thanx