Insurance Premium for vehicle

[Anup Kumar Grover]

Whether, First Car Insurance Premium Paid, on purchase of  Car, whether this amount to current expenditure or it be added to cost of Car? 

AI Summary

First Car Insurance Premium: Capitalize as Part of Vehicle Cost, Not Current Expenditure, per Motor Vehicles Act. A discussion on whether the first car insurance premium paid upon purchasing a car should be considered a current expenditure or added to the car's cost. The consensus, supported by two replies, is that the premium should be capitalized. This is because the Motor Vehicles Act mandates insurance for vehicles on the road, making it a prerequisite for taking delivery of the car, thus directly linking it to the vehicle's acquisition cost.