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Please Explain

R!tu Ber! (Chartered Accountant) (405 Points)

05 March 2010

please explain me amended Sec 73 A of IT Act applicable for MAY10 PCC and also the WDV concept m not able to get it from my book...

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Amir (Learner) (4016 Points)
Replied 05 March 2010

Dear Ritu,

Sec 73A & Sec 35AD have been inserted by Finance Act (No. 2), 2009

Sec 35AD provides for some specified business in which Assessee is allowed 100% deduction of capital expenditure in the same year instead of usual depreciation u/s 32

Now this is a BIG Incentive initself which is provided for such specified business , therefore for setting off & carry frwd & setting off of losses from such specified business separate Sec 73A is also introduced.

Now Sec 73A provides that Losses from such specified business can be setoff only with the profits of such specified business.

So Law makers must have thought that since we are giving a big incentive of 100% deduction of capital expenditure therefore it should be limited to these business only. To avoid any Abuse of this benefit.

Further one more benefit is provided that such losses can be carried forward for indefinate period.

specified business” means the any one or more of the following business, namely :—

(i) setting up and operating a cold chain facility;

(ii) setting up and operating a warehousing facility for storage of agricultural produce;

(iii) laying and operating a cross-country natural gas or crude or petroleum oil pipeline network for distribution, including storage facilities being an integral part of such network.

Now with this briefing if u again go through these sections, I think more or less it will be clear...

Ur specific queries are always welcome.

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