Does we have to charge depreciation
Atharv Sankliya (1354 Points)
11 May 2022
does we have to charge depreciation on gold jewellery
8 Replies
Eswar Reddy S
(CFO- at NHTF)
(58270 Points)
Replied 11 May 2022
What is the nature of business ?
Is it stock ?
Is it stock ?
Eswar Reddy S
(CFO- at NHTF)
(58270 Points)
Replied 11 May 2022
What is the nature of business ?
Is gold used for business purposes?
Is gold used for business purposes?
Atharv Sankliya
(1354 Points)
Replied 11 May 2022
For instance - if gold is used for business operation does we have to charge depreciation ??
Kev Men
(788 Points)
Replied 12 May 2022
Depreciation on gold jewellery should not be charged. As per Explanation 3 to Section 32(1) of the Income Tax Act, For the purposes of this sub-section, the expression "assets" shall mean—
[a] tangible assets, being buildings, machinery, plant or furniture.
Also, as per section 2(11) "block of assets" means a group of assets falling within a class of assets comprising—
[a] tangible assets, being buildings, machinery, plant or furniture.
As per the above sections, Gold jewellery is not a asset and depreciation will not be charged.
[a] tangible assets, being buildings, machinery, plant or furniture.
Also, as per section 2(11) "block of assets" means a group of assets falling within a class of assets comprising—
[a] tangible assets, being buildings, machinery, plant or furniture.
As per the above sections, Gold jewellery is not a asset and depreciation will not be charged.
Eswar Reddy S
(CFO- at NHTF)
(58270 Points)
Replied 12 May 2022
Gold is not a PPE as per AS-10 . Hence depreciation is not applicable. Check if mark to market is applicable
Eswar Reddy S
(CFO- at NHTF)
(58270 Points)
Replied 12 May 2022
If it is covered under Invest category as per AS-13 then market value of gold will be updated by financial year and balance will debited or credited to profit and loss towards depreciation or appreciation.
Check AS-13 once
Check AS-13 once
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