Research and Articles
![](/Content/images/arrow-3-right-red.png)
Hotline
![](/Content/images/arrow-3-right-red.png)
- Capital Markets Hotline
- Companies Act Series
- Climate Change Related Legal Issues
- Competition Law Hotline
- Corpsec Hotline
- Court Corner
- Cross Examination
- Deal Destination
- Debt Funding in India Series
- Deal Talk
- Dispute Resolution Hotline
- Education Sector Hotline
- FEMA Hotline
- Financial Service Update
- Food & Beverages Hotline
- Funds Hotline
- Gaming Law Wrap
- GIFT City Express
- Green Hotline
- HR Law Hotline
- iCe Hotline
- Insolvency and Bankruptcy Hotline
- International Trade Hotlines
- Investment Funds: Monthly Digest
- IP Hotline
- IP Lab
- Legal Update
- Lit Corner
- M&A Disputes Series
- M&A Hotline
- M&A Interactive
- Media Hotline
- New Publication
- Other Hotline
- Pharma & Healthcare Update
- Press Release
- Private Client Wrap
- Private Debt Hotline
- Private Equity Corner
- Real Estate Update
- Realty Check
- Regulatory Digest
- Regulatory Hotline
- Renewable Corner
- SEZ Hotline
- Social Sector Hotline
- Tax Hotline
- Technology & Tax Series
- Technology Law Analysis
- Telecom Hotline
- The Startups Series
- White Collar and Investigations Practice
- Yes, Governance Matters.
- Japan Desk ジャパンデスク
Tax Hotline
November 28, 2001Depreciation for power units may be cut to 75%
The Central Board of Direct Taxes (CBDT) of India is considering a proposal to lower the hundred per cent depreciation allowance provided in the Income-tax Act, 1961 for power generation devices and power saving devices like gas cylinders and wind mills.
The general opinion among tax authorities is to reduce the existing depreciation allowance to 75 per cent. The I-T authorities think this alone would bring in additional revenue of at least Rs 2,000 crore.
The chief commissioners are of the opinion that continuing with the 100 per cent depreciation was not advisable since it was a major cause of erosion of revenue, most of them had opined.
Also the hundred per cent depreciation has been extensively utilised by certain unscrupulous corporates to avoid taxation by claiming depreciation through the sale and lease back method. This is a convoluted accounting method that help corporates claim depreciation on items that do not actually belong to them.
It may be pointed out that a series of raids carried out by the investigation wing of income-tax department had unearthed the practice of bogus sale and lease back method employed by several corporates.
Source : The Economic Times, November 28, 2001