Depreciation on Assets Post-Demerger: Actual Cost Under Income Tax Act Section 43(1) Set to Nil, Benefits Retained.

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....Depreciation on assets on demerger - actual cost as per section 43(1) of the Income Tax Act, 1961 was nil - The demerger led to division of assets in a fixed ratio and the same was duly accounted for both the entities as per the written down value (WDV) as on that date. The depreciation on de-merger cannot be a forgone benefit owing to de-merger, which is the result of state reorganization. - AT....