Income-tax Rules, 2026

Rule 25Depreciation

Income-tax Rules, 2026 · G.S.R. 198(E), dated 20-03-2026

(1)Subject to the provisions of sub-rule (7), the allowance under section 33(3), in respect of depreciation of any block of assets specified in column (2) of the Table in Appendix I shall be calculated at the percentages specified in the column (3) of the said Table on the written down value of such block of assets as are used for the purposes of the business or profession of the assessee at any time during the tax year.

(2)The allowance under section 33(3) in respect of depreciation of any block of assets with respect to the persons mentioned in Column B of the following Table shall not exceed 40% of the written down value of such block of assets, if conditions mentioned in column C thereof are fulfilled:— Table Sl. No. Person Conditions to be fulfilled A B C

1. Domestic company Which has exercised option under– (a) section 199(3); or

(b)section 200(5); or

(c)section 201(2).

(a)Individual or Hindu undivided family; or

(b)association of persons or a body of individuals, whether incorporated or not; or

(c)artificial juridical person referred to in section 2(77)(g). Whose income is chargeable to tax under section 202(1).

3. Cooperative society resident in India Which has exercised option under–

(a)section 203(5); or

(b)section 204(2).

(3)The allowance under section 33(2) in respect of depreciation of assets acquired on or after 1 st April, 1977 specified in column (2) of the Table in Appendix II, shall be calculated at the percentage specified in the column (3) thereof on the actual cost to the assessee as are used for the purposes of the business of the assessee at any time during t he tax year.

(4)The aggregate depreciation allowed under section 33(2), in respect of any asset for different tax years shall not exceed the actual cost of the said asset.

(5)The undertaking specified in section 33(2) may, at its option, be allowed depreciation under sub-rule (1) read with Appendix I instead of the depreciation specified in Appendix II, if option is exercised on or before the due date for furnishing the return of income under section 263(1)(c) for the tax year in which it begins to gene rate power.

(6)Any option under sub-rule (5) once exercised, shall be final and shall apply to all the subsequent tax years.

(7)Where any new machinery or plant is installed during the tax year commencing on or after the 1st April, 1987, for the purposes of business of manufacture or production of any article or thing and such article or thing —

(a)is manufactured or produced by using any technology (including any process) or other know-how developed in; or

(b)is an article or thing invented in, a laboratory owned or financed by the Government or a laboratory owned by a public sector company or a University or an institution recognised in this behalf by the Secretary, Department of Scientific and Industrial Research, Government of India, such plant or machinery shall be treated as a part of block of assets qualifying for depreciation at the rate of 40% of written down value, if the following conditions are fulfilled:—

(i)the right to use such technology (including any process) or other know-how or to manufacture or produce such article or thing has been acquired from the owner of such laboratory or any person deriving title from such owner;

(ii)the return furnished by the assessee for his income, or the income of any other person in respect of which he is assessable, for any tax year in which the said machinery or plant is acquired, shall be accompanied by a certificate from the Secretary, Department of Scientific and Industrial Research, Government of India, to the effect that such article or thing is manufactured or produced by using such technology (including any process) or other know-how developed in such laboratory or is an article or thing invented in such laboratory ; and

(iii)the machinery or plant is not used for the purpose of business of manufacture or production of any article or thing specified in the list in the Schedule XIII to the Act.

(8)For the purposes of sub-rule (7),–

(a)"laboratory financed by the Government" means a laboratory owned by any body including a society registered under the Societies Registration Act, 1860 (2 of 1860) and financed wholly or mainly by the Government;

(b)"public sector company" means any corporation established by or under any Central Act, State Act or Provincial Act or a Government company as defined in section 2(45) of the Companies Act, 2013 (18 of 2013); and

(c)"University" means a University established or incorporated by or under a Central, State or Provincial Act and includes an institution declared under section 3 of the University Grants Commission Act, 1956 (3 of 1956), to be a University for the purposes of that Act.

APPENDIX I — TABLE OF RATES AT WHICH DEPRECIATION IS ADMISSIBLE

[See rule 25(1) — the general depreciation schedule for Part A (Tangible Assets: buildings, furniture and fittings, machinery and plant, ships) and Part B (Intangible Assets), applicable except where rule 25(3) (assets acquired on or after 1st April, 1977 under the categories in Appendix II) or an option under rule 25(5) applies instead.]

S.No.	Block of assets	Depreciation allowance as percentage of written down value
1.	I. Building [See Notes 1 to 4 below]	Nil.
2.	1. Buildings which are used mainly for residential purposes except hotels and boarding houses	5
3.	2. Buildings other than those used mainly for residential purposes and not covered by sub-items (1) above and (3) below	10
4.	3. Buildings for installing machinery and plant forming part of water supply project or water treatment system and which is put to use for the purpose of business of providing infrastructure facilities under section 80-IA(4)(i) of the Income-tax Act, 1961	40
5.	4 Purely temporary erections such as wooden structures	40
6.	II Furniture and fittings	Nil.
7.	Furniture and fittings including electrical fittings [See Note 5 below]	10
8.	III Machinery and Plant	Nil.
9.	1. Machinery and plant other than those covered by sub-items (2), (3) and (8) below:	15
10.	2 (i) Motor cars, other than those used in a business of running them on hire, except those covered under entry (ii) acquired on or after the 1st April, 1990;	15
11.	(ii) Motor cars, other than those used in a business of running them on hire, acquired on or after the 23rd August, 2019 but before the 1st April, 2020 and is put to use before the 1st April, 2020.	30
12.	3 (i) Aeroplanes - Aeroengines	40
13.	(ii) Motor buses, motor lorries and motor taxis used in a business of running them on hire.	30
14.	(iii) Motor buses, motor lorries and motor taxis used in a business of running them on hire, acquired on or after the 23rd August, 2019 but before the 1st April, 2020 and is put to use before the 1st April, 2020.	45
15.	(iv) New commercial vehicle which is acquired on or after the 1st January, 2009 but before the 1st October, 2009 and is put to use before the 1st October, 2009 for the purposes of business or profession [See Note 6 below]	40
16.	(v) Moulds used in rubber and plastic goods factories	30
17.	(vi) Air pollution control equipment, being—	Nil.
18.	(a) Electrostatic precipitation systems	40
19.	(b) Felt-filter systems	40
20.	(c) Dust collector systems	40
21.	(d) Scrubber-counter current/venturi/packed bed/cyclonic scrubbers	40
22.	(e) Ash handling system and evacuation system	40
23.	(vii) Water pollution control equipment, being—	Nil.
24.	(a) Mechanical screen systems	40
25.	(b) Aerated detritus chambers (including air compressor)	40
26.	(c) Mechanically skimmed oil and grease removal systems	40
27.	(d) Chemical feed systems and flash mixing equipment	40
28.	(e) Mechanical flocculators and mechanical reactors	40
29.	(f) Diffused air/mechanically aerated activated sludge systems	40
30.	(g) Aerated lagoon systems	40
31.	(h) Biofilters	40
32.	(i) Methane-recovery anaerobic digester systems	40
33.	(j) Air flotation systems	40
34.	(k) Air/steam stripping systems	40
35.	(l) Urea Hydrolysis systems	40
36.	(m) Marine outfall systems	40
37.	(n) Centrifuge for dewatering sludge	40
38.	(o) Rotating biological contractor or bio-disc	40
39.	(p) Ion exchange resin column	40
40.	(q) Activated carbon column	40
41.	(viii) (a) Solid waste, control equipment being - caustic/lime/ chrome/mineral/cryolite recovery systems	40
42.	(b) Solid waste recycling and resource recovery systems	40
43.	(ix) Machinery and plant, used in semi-conductor industry covering all Integrated Circuits (ICs) (excluding hybrid integrated circuits) ranging from Small Scale Integration (SSI) to Large Scale Integration/Very Large Scale Integration (LSI/VLSI) as also discrete semi-conductor devices such as diodes, transistors, thyristors, triacs, etc., other than those covered by entries (iv), (v) and (vi) of this sub-item and sub-item (7) below.	30
44.	(x) Life saving medical equipment, being—	Nil.
45.	(a) D.C. Defibrillators for internal use and pace makers	40
46.	(b) Heamodialysors	40
47.	(c) Heart lung machine	40
48.	(d) Cobalt Therapy Unit	40
49.	(e) Colour Doppler	40
50.	(f) SPECT Gamma Camera	40
51.	(g) Vascular Angiography System including Digital Subtraction Angiography	40
52.	(h) Ventilator used with anaesthesia apparatus	40
53.	(i) Magnetic Resonance Imaging System	40
54.	(j) Surgical Laser	40
55.	(k) Ventilator other than those used with anaesthesia	40
56.	(l) Gamma knife	40
57.	(m) Bone Marrow Transplant Equipment including silastic long standing intravenous catheters for chemotherapy	40
58.	(n) Fibre optic endoscopes including, Paediatric resectoscope/audit resectoscope, Peritoneoscopes, Arthoscope, Microlaryngoscope, Fibreoptic Flexible Nasal Pharyngo Bronchoscope, Fibreoptic Flexible Laryngo Bronchoscope, Video Laryngo Bronchoscope and Video Oesophago Gastroscope, Stroboscope, Fibreoptic Flexible Oesophago Gastroscope	40
59.	(o) Laparoscope (single incision)	40
60.	4 Containers made of glass or plastic used as re-fills	40
61.	5 Computers including computer software (See Note 7 below)	40
62.	6 Machinery and plant, acquired and installed on or after the 1st September, 2002 in a water supply project or a water treatment system and which is put to use for the purpose of business of providing infrastructure facility under clause (i) of sub-section (4) of section 80-IA of the Income-tax Act, 1961 [See Notes 4 and 8 below]	40
63.	7 (i) Wooden parts used in artificial silk manufacturing machinery	40
64.	(ii) Cinematograph films - bulbs of studio lights	40
65.	(iii) Match factories - Wooden match frames	40
66.	(iv) Mines and quarries	Nil.
67.	(a) Tubs winding ropes, haulage ropes and sand stowing pipes	40
68.	(b) Safety lamps	40
69.	(v) Salt works - Salt pans, reservoirs and condensers, etc., made of earthy, sandy or clayey material or any other similar material	40
70.	(vi) Flour mills – Rollers	40
71.	(vii) Iron and steel industry - Rolling mill rolls	40
72.	(viii) Sugar works – Rollers	40
73.	(ix) Energy saving devices, being—	Nil.
74.	A. Specialised boilers and furnaces:	Nil.
75.	(a) Ignifluid/fluidized bed boilers	40
76.	(b) Flameless furnaces and continuous pusher type furnaces	40
77.	(c) Fluidized bed type heat treatment furnaces	40
78.	(d) High efficiency boilers (thermal efficiency higher than 75 per cent in case of coal fired and 80 per cent in case of oil/gas fired boilers)	40
79.	B. Instrumentation and monitoring system for monitoring energy flows :	Nil.
80.	(a) Automatic electrical load monitoring systems	40
81.	(b) Digital heat loss meters	40
82.	(c) Micro-processor based control systems	40
83.	(d) Infra-red thermography	40
84.	(e) Meters for measuring heat losses, furnace oil flow, steam flow, electric energy and power factor meters	40
85.	(f) Maximum demand indicator and clamp on power meters	40
86.	(g) Exhaust gases analyzer	40
87.	(h) Fuel oil pump test bench	40
88.	C. Waste heat recovery equipment:	Nil.
89.	(a) Economisers and feed water heaters	40
90.	(b) Recuperators and air pre-heaters	40
91.	(c) Heat pumps	40
92.	(d) Thermal energy wheel for high and low temperature waste heat recovery	40
93.	D. Co-generation systems:	Nil.
94.	(a) Back pressure pass out, controlled extraction, extraction-cum-condensing turbines for co-generation along with pressure boilers	40
95.	(b) Vapour absorption refrigeration systems	40
96.	(c) Organic rankine cycle power systems	40
97.	(d) Low inlet pressure small steam turbines	40
98.	E. Electrical equipment:	Nil.
99.	(a) Shunt capacitors and synchronous condenser systems	40
100.	(b) Automatic power cut-off devices (relays) mounted on individual motors	40
101.	(c) Automatic voltage controller	40
102.	(d) Power factor controller for AC motors	40
103.	(e) Solid state devices for controlling motor speeds	40
104.	(f) Thermally energy-efficient stenters (which require 800 or less kilocalories of heat to evaporate one kilogram of water)	40
105.	(g) Series compensation equipment	40
106.	(h) Flexible AC Transmission (FACT) devices - Thyristor controlled series compensation equipment	40
107.	(i) Time of Day (ToD) energy meters	40
108.	(j) Equipment to establish transmission highways for National Power Grid to facilitate transfer of surplus power of one region to the deficient region	40
109.	(k) Remote terminal units/intelligent electronic devices, computer hardware/software, router/bridges, other required equipment and associated communication systems for supervisory control and data acquisition systems, energy management systems and distribution management systems for power transmission systems	40
110.	(l) Special energy meters for Availability Based Tariff (ABT)	40
111.	F. Burners:	Nil.
112.	(a) 0 to 10 per cent excess air burners	40
113.	(b) Emulsion burners	40
114.	(c) Burners using air with high pre-heat temperature (above 300 �C)	40
115.	G. Other equipment:	Nil.
116.	(a) Wet air oxidation equipment for recovery of chemicals and heat	40
117.	(b) Mechanical vapour recompressors	40
118.	(c) Thin film evaporators	40
119.	(d) Automatic micro-processor based load demand controllers	40
120.	(e) Coal based producer gas plants	40
121.	(f) Fluid drives and fluid couplings	40
122.	(g) Turbo charges/super-charges	40
123.	(h) Sealed radiation sources for radiation processing plants	40
124.	(x) Gas cylinders including valves and regulators	40
125.	(xi) Glass manufacturing concerns - Direct fire glass melting furnaces	40
126.	(xii) Mineral oil concerns:	Nil.
127.	(a) Plant used in field operations (above ground) distribution -Returnable packages	40
128.	(b) Plant used in field operations (below ground), but not including kerbside pumps including underground tanks and fittings used in field operations (distribution) by mineral oil concerns	40
129.	(c) Oil wells not covered in clauses (a) and (b)	15
130.	(xiii) Renewable energy devices being	Nil.
131.	(a) Flat plate solar collectors	40
132.	(b) Concentrating and pipe type solar collectors	40
133.	(c) Solar cookers	40
134.	(d) Solar water heaters and systems	40
135.	(e) Air/gas/fluid heating systems	40
136.	(f) Solar crop driers and systems	40
137.	(g) Solar refrigeration, cold storages and air conditioning systems	40
138.	(h) Solar steels and desalination systems	40
139.	(i) Solar power generating systems	40
140.	(j) Solar pumps based on solar-thermal and solar-photovoltaic conversion	40
141.	(k) Solar-photovoltaic modules and panels for water pumping and other applications	40
142.	(l) Wind mills and any specially designed devices which run on wind mills installed on or after the 1st April, 2014	40
143.	(m) Any special devices including electric generators and pumps running on wind energy installed on or after the 1st April, 2014	40
144.	(n) Biogas-plant and biogas-engines	40
145.	(o) Electrically operated vehicles including battery powered or fuel-cell powered vehicles	40
146.	(p) Agricultural and municipal waste conversion devices producing energy	40
147.	(q) Equipment for utilising ocean waste and thermal energy	40
148.	(r) Machinery and plant used in the manufacture of any of the above sub-items	40
149.	8 (i) Books owned by assessees carrying on a profession—	Nil.
150.	(a) Books, being annual publications	40
151.	(b) Books, other than those covered by entry (a) above	40
152.	(ii) Books owned by assessees carrying on business in running lending libraries	40
153.	IV Ships	Nil.
154.	Ocean-going ships including dredgers, tugs, barges, survey launches and other similar ships used mainly for dredging purposes and fishing vessels with wooden hull	20
155.	Vessels ordinarily operating on inland waters, not covered by sub-item (3) below	20
156.	Vessels ordinarily operating on inland waters being speed boats [See Note 9 below]	20
157.	Know-how, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature	25

Notes:

(1)"Buildings" include roads, bridges, culverts, wells and tubewells.

(2)A building shall be deemed to be a building used mainly for residential purposes, if the built up floor area thereof used for residential purposes is not less than sixty-six and two-third per cent of its total built-up floor area and shall include any such building in the factory premises.

(3)In respect of any structure or work by way of renovation or improvement in or in relation to a building referred to in section 33(6), the percentage to be applied will be the percentage specified against sub-item (1) or (2) of item 1 of PART A as may be appropriate to the class of building in or in relation to which the renovation or improvement is effected. Where the structure is constructed or the work is done by way of extension of any such building, the percentage to be applied would be such percentage as would be appropriate, as if the structure or work constituted a separate building.

(4)Water treatment system includes system for desalination, demineralisation and purification of water.

(5)"Electrical fittings" include electrical wiring, switches, sockets, other fittings and fans, etc.

(6)"Commercial vehicle" means "heavy goods vehicle", "heavy passenger motor vehicle", "light motor vehicle", "medium goods vehicle" and "medium passenger motor vehicle" but does not include "maxi-cab", "motor-cab", "tractor" and "road-roller". The expressions "heavy goods vehicle", "heavy passenger motor vehicle", "light motor vehicle", "medium goods vehicle", "medium passenger motor vehicle", "maxi-cab", "motor-cab", "tractor" and "road-roller" shall have the meanings respectively assigned to them in section 2 of the Motor Vehicles Act, 1988 (59 of 1988).

(7)"Computer software" means any computer program recorded on any disc, tape, perforated media or other information storage device.

(8)Machinery and plant includes pipes needed for delivery from the source of supply of raw water to the plant and from the plant to the storage facility.

(9)"Speed boat" means a motor boat driven by a high speed internal combustion engine capable of propelling the boat at a speed exceeding 24 kilometres per hour in still water and so designed that when running at a speed, it will plane, i.e., its bow will rise from the water.

APPENDIX II — TABLE OF RATES AT WHICH DEPRECIATION IS ADMISSIBLE

[See rule 25(3) — assets acquired on or after 1st April, 1977, other than those covered by the 40%-cap categories in rule 25(2) or an option exercised under rule 25(5) to use Appendix I instead.]

S.No.	Class of assets	Depreciation allowance as percentage of actual cost
1.	(a) Plant and Machinery in generating stations including plant foundations :—	Nil.
2.	(i) Hydro-electric	3.4
3.	(ii) Steam electric NHRS & Waste heat recovery Boilers/plants	7.84
4.	(iii) Diesel electric and Gas plant	8.24
5.	(b) Cooling towers and circulating water systems	7.84
6.	(c) Hydraulic works forming part of Hydro-electric system including :—	Nil.
7.	(i) Dams, spillways weirs, canals, reinforced concrete flumes and syphons	1.95
8.	(ii) Reinforced concrete pipelines and surge tanks, steel pipelines, sluice gates, steel surge (tanks), hydraulic control valves and other hydraulic works.	3.4
9.	(d) Building and civil engineering works of permanent character, not mentioned above	Nil.
10.	(i) Office and showrooms	3.02
11.	(ii) Containing Thermo-electric generating plant	7.84
12.	(iii) Containing Hydro-Electric generating plant	3.4
13.	(iv) Temporary erection such as wooden structures	33.4
14.	(v) Roads other than Kutcha roads	3.02
15.	(vi) Others	3.02
16.	(e) Transformers, transformer (Kiosk) sub-station equipment and other fixed apparatus (including plant foundations)	Nil.
17.	(i) Transformers (including foundations) having a rating of 100 kilovolt amperes and over	7.81
18.	(ii) Others	7.84
19.	(f) Switchgear including cable connections	7.84
20.	(g) Lightning arrestor:	Nil.
21.	(i) Station type	7.84
22.	(ii) Pole type	12.77
23.	(iii) Synchronous condenser	5.27
24.	(h) Batteries	33.4
25.	(i) Underground cable including joint boxes and disconnectioned boxes	5.27
26.	(ii) Cable duct system	3.02
27.	(i) Overhead lines including supports:	Nil.
28.	(i) Lines on fabricated steel operating at nominal voltages higher than 66 kilovolt	5.27
29.	(ii) Lines on steel supports operating at nominal voltages higher than 13.2 kilovolts but not exceeding 66 kilovolts	7.84
30.	(iii) Lines on steel or reinforced concrete supports	7.84
31.	(iv) Lines on treated wood supports	7.84
32.	(j) Meters	12.77
33.	(k) Self-propelled vehicles	33.40
34.	(l) Air-conditioning plants:	Nil.
35.	(i) Static	12.77
36.	(ii) Portable	33.40
37.	(m) Office furniture and fittings	12.77
38.	(ii) Office equipments	12.77
39.	(iii) Internal wiring including fittings and apparatus	12.77
40.	(iv) Street light fittings	12.77
41.	(n) Apparatus let on hire	Nil.
42.	(i) Other than motors	33.4
43.	(ii) Motors	12.77
44.	(o) Communication equipment:	Nil.
45.	(i) Radio and high frequency carrier system	12.77
46.	(ii) Telephone lines and telephones	12.77
47.	(p) Any other assets not covered above	7.69

This rule refers to

§ Schedule XIII LIST OF ARTICLES OR THINGS

§ 199 Tax on income of certain manufacturing domestic companies

§ 2 Definitions

§ 200 Tax on income of certain domestic companies

§ 201 Tax on income of new manufacturing domestic companies.

§ 202 New tax regime for individuals, Hindu undivided family and others

§ 203 Tax on income of certain resident co-operative societies

§ 204 Tax on income of certain new manufacturing co-operative societies

§ 263 Return of income.

§ 33 Deduction for depreciation