Depreciation

[Guest]

Respected sirI provide your valuable opinion on the issue that when an asset forms part of the block of assets.Suppose an asset is purchased but not put to use in the previous year then whether for the purpose of calculating WDV u/s 43(6), the actual cost of such unused asset shall be included or not?

AI Summary

Unused Asset Cost Exclusion in WDV Calculation Under Section 43(6) of Income Tax Act Clarified: Depreciation Requires Usage. A participant inquired about whether the actual cost of an unused asset should be included in the written down value (WDV) calculation under section 43(6) of the Income Tax Act. The response clarified that depreciation is applicable only when an asset is put to use, as its value decreases through usage. Therefore, the WDV of an unused asset should not be included in the calculation for depreciation purposes.