Depreciation

[janakiraman iyer]

when one purchase flat in Mumbai or in Gujarat , developer enters into two agreements, one for sale of undivided cost of land and other for construction etc but the effect is acquisition of flat by acquiring shares in cooperative society as land is never conveyed in name of any member but only to cooperative society and so when a corporate claim depreciation on this purchase , they are entitled for deprecation on both the values namely purchase of undivided portion of land and construction cost of flat. can one give any case law on this legal point

AI Summary

Depreciation on cooperative flat acquisitions: whether undivided land share and construction qualify for tax depreciation. Whether a corporate purchaser who acquires a flat through separate agreements for an undivided share of land and for construction, but effectively obtains membership/shares in a cooperative society because land title remains with the society, may claim depreciation on both the undivided land share and the construction cost; the core considerations are asset characterization, statutory limits on depreciability of land, allocation of purchase price between land and building, and precedent on cooperative membership acquisitions.