Construction value

Question BankCategory: Income TaxConstruction value
Kollipara sundaraiah asked 3 months ago

Sir,
Assess source of professional income total Gross receipts Rs.55,00,000 in f .Y. 2019-2020.
Assess construction of commerical building new strated in f.y. 2019-2020.
1.Some construction expenses Rs.5,00,000/- payment  on cash mode ( above 10,000/- limit).
2. Some construction expenses Rs.12,00,000/- payment on bank account payee.
Total cash and bank mode of construction expenses(work in progress).Rs.17,00,000/-. In f.y.2019-2020.
Question:
1.Assess construction expenses value amount Rs.12,00,000/- or Rs.17,00,000/- mentioned shown accounting ledger books in f.y.2019-2020.
2. Cash mode of construction expenses depreciation claimed eligible  and calculation producure.
 

1 Answers
Sanjay answered 3 months ago

If cash payment for construction exp. does not fall under exceptions of section 40A(3) then cash expenses will not be added in value of assets…hence construction value of assets is Rs. 1200000/- and depreciation can be claimed only on Rs. 1200000/- not 1700000/-

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