Provisions of additional depreciation for newly purchased plant or machinery

Applicability: It is applicable to assesses engaged in the business of manufacture / production of any article or a thing.

Eligible Asset: Any new machinery or plant acquired and installed after 31-03-2005.

Ineligible Assets:

1. Ships and Aircrafts
2. Any machinery or plant which, before installation by the assessee, was used either within or  outside India by any other person, or
   
3. Any machinery or plant installed in any office premises or any residential accommodation, including accommodation in the nature of a guest house, or
4. Any office appliance or road transport vehicle, or
5. Any machinery or plant, the whole cost of which is allowed as a deduction in computing the Income chargeable under the head “Profits and Gains of Business or Profession” of any one previous year.

Rate of Additional depreciation: 20% of the actual cost of machinery or plant.

Additional Depreciation: Assets newly acquired and put to use in the same previous year for less than 180 days, the additional depreciation shall be provided at 50% of normal rate applicable