Written down value of a block of assets as on 1st April 2017 was ₹4,00,000. On 12th May, 2017, an asset belonging to the same block was purchased for ₹2,00,000. Suddenly a fire broke out on 18th October, 2017. Rate of de

Computation of Amount of Capital Gains if part of the assets are destroyed by fire and company receives ₹5,00,000 as compensation from an insurance company As the block of assets was not fully destroyed, so no capital gains will arise u/s 50 of the Income Tax Act, 1961. Depreciation and written down value 'WDV' as on 01/04/2018 can be calculated as under: Particulars Amount (₹) Assets as on 01/04/2017 4,00,000 Add: Assets purchased on 12/05/2017 2,00,000 Total 6,00,000 Less: Money received from Insurance Co. (5,00,000) WDV of the Block of assets for current year depreciation 1,00,000 Less: Depreciation @ 15% (15,000) WDV of the block of assets as on 01/04/2018 85,000