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2014 (12) TMI 1324 - ITAT BANGALOREMethod of accounting followed by the assessee - justification in changing the method by AO - Project Completion Method OR Completed Contract method - Held that:- Apex Court in the case of CIT v. Hyundai Heavy Industries Co. Ltd., [2007 (5) TMI 196 - SUPREME COURT] also took the similar view and held that both the methods of accounting ( i.e., Project Completion Method and Completed Contract method) were recognized methods of accounting. The assessee was at liberty to choose any of the above methods and if any one of the method of accounting was consistently followed by the assessee, the AO couldn’t change such method of accounting. The completed contract method followed by the assessee, in the instant case, therefore, could not be faulted with by the revenue authorities and on that basis it was not correct to say that the accounts of assessee did not present correct and complete picture of its profits. Therefore, there was no justification in changing the method from project completion to percentage completion method by the AO, which was upheld by the CIT(A). Therefore, the order of the Commissioner (Appeals) is set aside - we allow the appeal of the Assessee and hold that the method of accounting followed by the Assessee has to be accepted. Liability to pay interest u/s.234A and 234B - Held that:- The charging of interest is consequential and mandatory and the Assessing Officer has no discretion in the matter and in this view of the matter, we uphold his action in charging the said interest. This proposition has been upheld by the Hon'ble Apex Court in the case of Anjum H Ghaswala & Others (2001 (10) TMI 4 - SUPREME COURT). Proportionate deduction u/s. 80IB(10) - profits derived from sale of residential units whose built-up area is less than 1500 sq.ft., even though some of the residential units in the very same project exceeds the built-up area of 1500 sq.ft. - Held that:- The same has been decided by the Hon’ble High Court of Karnataka in the case of CIT v. SJR Builders [2012 (3) TMI 615 - KARNATAKA HIGH COURT] as taken the view confirming the order of the Tribunal, by holding that where residential units exceed the built-up area of 1500 sq.ft., such units may be excluded for deduction, but the assessee will not lose the benefit of deduction u/s. 80IB(10) in its entirety. It is only with reference to the flats which is more than the prescribed area that the assessee will lose the benefit of deduction. - Decided in favour of assessee
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