Is depreciation allowable on purchase of fixed assets by cash, Which used for bussiness purpose?

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 Yes!, depreciation is allowable on purchase of asset for business purpose by cash, subject to certain conditions. The asset must be used for the business or profession of the assessee, and it must be owned, wholly or partly, by the assessee. The asset must also have a useful life of more than one year. However, there is a restriction on claiming depreciation on assets purchased in cash. Section 43 of the Income Tax Act, 1961, disallows the capital expenditure incurred in cash for certain specified assets, including fixed assets. This means that if you purchase an asset for your business in cash, you will not be able to claim depreciation on the cost of the asset. There are a few exceptions to this rule. For example, you will still be able to claim depreciation on assets purchased in cash if the amount of the expenditure does not exceed Rs. 20,000. You will also be able to claim depreciation on assets purchased in cash if the asset is used for scientific research or for the purpos...
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Benefits of Investing in Mutual Funds

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 Mutual funds offer several benefits to investors. Here are some of the key advantages:

  • Diversification: Mutual funds pool money from multiple investors and invest it in a diversified portfolio of securities, such as stocks, bonds, and other assets. This diversification helps spread the risk across different investments, reducing the impact of any individual security's performance on the overall portfolio.
  • Professional Management: Mutual funds are managed by experienced investment professionals who analyze the market, research investment opportunities, and make informed decisions on behalf of the fund's investors. This relieves individual investors of the burden of directly managing their investments.
  • Accessibility: Mutual funds are easily accessible to individual investors with various investment amounts. They offer the flexibility to invest small or large sums of money, making them suitable for both beginner and seasoned investors.
  • Liquidity: Mutual funds provide liquidity to investors, allowing them to buy or sell their shares on any business day at the current net asset value (NAV). This makes it relatively easy to convert investments into cash when needed, providing a level of flexibility and convenience.
  • Affordability: Mutual funds enable investors to participate in a diversified portfolio of securities with relatively small amounts of money. This is particularly beneficial for small investors who may not have sufficient capital to construct a well-diversified portfolio on their own.
  • Transparency: Mutual funds are required to provide regular reports and disclose their holdings, performance, expenses, and other essential information to investors. This transparency allows investors to make informed decisions and monitor the progress of their investments.
  • Flexibility: Mutual funds come in various types, such as equity funds, bond funds, index funds, sector-specific funds, and more. This enables investors to choose funds that align with their investment goals, risk tolerance, and time horizon.
  • Systematic Investment: Mutual funds offer the option of systematic investment plans (SIPs), which allow investors to invest a fixed amount regularly at predetermined intervals. SIPs promote disciplined investing and help in averaging the cost of investments over time.
  • Regulatory Oversight: Mutual funds are subject to regulatory oversight and must comply with stringent regulations designed to protect the interests of investors. This regulatory framework helps ensure transparency, accountability, and investor protection.


It's important to note that while mutual funds offer several benefits, they also come with risks. Investors should carefully consider their investment objectives, risk tolerance, and the fund's prospectus before investing. Consulting with a financial advisor can provide personalized guidance based on individual circumstances.

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