A Comapny has purchased costly paintings for the decoration of the office .can this be treated as fixed assets?but i think this doesnot fit into definition of the fixed assts.pls reply.
Dinesh
(Auditor)
(66 Points)
Replied 28 February 2009
Since these paintaings doesnt increase the life of building or furniture or whatever asset , its for sure that its not a fixed asset. However if u treat as revenue expenditure, the IT may raise a question for such costly paintaings (i supposed that these paintaings are of MF husssain and worth >1 crores) and may be disallowed u/s 37 of IT Act. Then u have to proove to the IT department these expenditure is related to the business.
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