TMI BlogICDS V : Tangible Fixed AssetsX X X X Extracts X X X X X X X X Extracts X X X X ..... th only tangible fixed assets, intangible assets are outside the purview of this ICDS. Hence fittings are not specifically covered under the definition of Tangible fixed Assets as per this ICDS; however, since the same are considered as part of Block of Assets, the provisions of this ICDS shall also be accordingly applicable to Fittings either under Plant and Machinery or Furniture. Since intangible assets are excluded from the scope of this ICDS, for the purpose of computation of income, the treatment of intangible assets would be based on the normal provisions of the Act and accounting principles. Tangible fixed assets:- Asset being land, building, machinery, plant or furniture held with the intention of being used for the purpo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... effects of changes in foreign exchange rates. Note:- If any subsidy or grant receivable from Government relatable to acquisition of an asset is concerned, then such amount shall be excluded from the actual cost of the asset. In case of an asset acquired from a country outside India, the increase or reduction in liability of the assessee while making payment towards the cost of the asset or repayment of the moneys borrowed for acquiring the asset in consequence of change in the rate of exchange, shall be added to or deducted from the actual cost. In a situation where assets are acquired in India by availing a foreign currency loan or borrowing, ICDS VI does not specifically provide for treatment in such cases. Thus the inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l profits (e.g. inter-departmental/inter-branch profits in case of self-constructed asset) are to be eliminated in arriving at such cost. 5. Non- monetary Consideration:- This ICDS provides that where an asset is acquired in exchange for another asset or in exchange for shares or other securities, the actual cost of the asset acquired to be recognised, is the fair value of the asset so acquired. 7. Improvements and Repairs:- An asset may undergo improvement and repairs from time to time. This ICDS provides that any expenditure in the nature of repairs or improvements that increases the future benefits from an asset beyond the previously assessed standard of performance is to be added to the actual cost and to that extent thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on and distribution of power and on written down value in case of any block of assets. This ICDS does not have a provision for change in the method of depreciation and revaluation of fixed assets, since these are not relevant under the Act. 10. Transfers:- Under transfers ICDS draws reference to the provisions of the Act for computation of income arising on transfer of a tangible fixed asset. Accordingly, income on transfer is to be computed by applying relevant provisions of the Act. For this purpose, provisions of section 41(2) (business income) and those falling under Chapter IV-E (Capital Gains) need to be complied with. 11. Disclosures:- Following disclosure shall be made in respect of tangible fixed assets, na ..... X X X X Extracts X X X X X X X X Extracts X X X X
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