Declaration ‑ Whether, for purposes of determining depreciation to be provided under the section read with section 350, it is immaterial as to whether depreciation in respect of any assets is actually admissible under the Income‑tax Act and rules made thereunder.

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..... ‑ VI/61, dated 21 ‑ 5 ‑ 1962. Subject:- Declaration ‑ Whether, for purposes of determining depreciation to be provided under the section read with section 350, it is immaterial as to whether depreciation in respect of any assets is actually admissible under the Income ‑ tax Act and rules made thereunder. A case has been brought to the notice of .....

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..... en advised that the contention of the company, in the case mentioned above, is not tenable in law. As the company managements are aware, the provisions in sub‑sections (1) and (2) of section 205 are mandatory in nature and must be strictly complied with by every company before declaring or paying any dividend. For purposes of determining the amount of depreciation to be provided under sec .....

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..... ses where no rate of depreciation is allowed by the Income‑tax Act. If a company has calculated its distributable profits without providing for depreciation in the manner required by section 205 and if the profit and loss account of the company does not provide for depreciation accordingly, the balance sheet and profit and loss account of the company for the relevant year cannot be said to .....

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