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Question ID : 42294

WDV-Section 43(6)(c)

Opening WDV as on 1-4-2021 Of only Vehicles Block(consisting of Car A-WDV Rs. 1 Lakh and Car B-WDV Rs. 8 Lakhs) is Rs. 9 Lakhs. During the year 2021-22, Car B is stolen. Insurance claim of Rs. 12 Lakhs is received. One new Car C is purchased for Rs. 22 Lakhs during the year 2021-22.What will be the WDV for working out of Depreciation for the year 2021-22 under the circumstances. Also, how these transactions should be booked in Books of Accounts.

Posted by ARUN KUMAR ARORA on Jun 05, 2022

Filed Under DIRECT TAXES

Answer ID : 81515

WDV of car B will be zero. WDV of car A and C will be considered for calculation of depreciation. Bank account will be debited with RS. 12 Lakh. Car B will be credited with WDV of Rs. 8 Lakh and income from insurance claim received for car stolen will be credited with balance amount of Rs. 4 lakh.

Posted by CA. chunauti dholakia on Jun 06, 2022