Query on AS 16

so does that mean we should include the CENVAT/VAT portion of the expenditure ?!?!?!?

cost of an fixed asset include the duties and other taxes if it is not refundable subsquently.

if such taxes are being capable to be refunded, they shall not be included in the expenditure incurred on capital asset for the purpose of AS-16 also.

thanks anshu but is there any notification or circulars etc to substantiate the above stand . . . jus to share it with my client . .

no notification or circular about same.

but it can be understood in accordance with AS-2 and AS-10

absolutely no sir

can as-2 and as-10 override the provisions of as-16?

no AS overrides each other,

but where one AS is silence in any matter, same can be understood with reference to another AS.

However, where an AS specifically deals sone matter, another AS shall not apply on that matter

Friends, if we go as per AS 16 which relates to capitalisation of borrowing costs, it says "exp incurred on qualifying assets". Anything that can not be capitalised as cost of qualifying  asset can not be said to be exp incurred on that asset. In that sense we need to refer to As 2 and AS 10 as rightly said by Anshu Agarwal. There is no question of overriding provisions as for cost of inventory or cost of fixed assets AS 2 and AS 10 are specifially meant. AS 16 just tells us about how much borrowing cost can be capitalised. The capitalisation rate will be applied on cost of qualifying asset as per AS 2 or 10 as the case may be.

Regards, CA Shakuntala Chhangani