Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2014 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (8) TMI 795 - AT - Income TaxAccrual of income - Sale consideration treated as undisclosed income - Civil construction business - Whether the real income has been offered for taxation by the assessee or not – agriculture land was purchased - pending NA clearance, land was plotted and sold but could not registered - later 2.5 times money was returned to allottees - Held that:- The objection of the AO regarding the non-saleability of the land without NA is neither relevant to the issue nor it is against the prevalent business practice - Such schemes where the facts are known to the allottees are much prevalent and it cannot be the case that once the plots are allotted the income should not be shown - assessee correctly showed the income in the earlier years recognizing the revenue from transfer of rights - It cannot be said that the cost to reacquire the rights would not be allowed and only the entire sale proceeds would be taxed - only real income has to be taxed. Payments had started to some of the allottees does not mean that the profits from sale where no sale deed has been finally signed had accrued - The expenses claimed are the development expenses which were already shown in the books of accounts of M/s Maheshwari Builders, naturally as in those years the projects were accounted for in its books - Only real income has to be taxed – Relying upon Smt. Jashvidyaben C. Mehta Versus Commissioner Of Income-Tax [1987 (9) TMI 18 - GUJARAT High Court] - CIT(A) has rightly noted that the discrepancies noted by the AO were never confronted to the assessee and therefore he did not get an opportunity to controvert them - total profit of the scheme has been declared by the assessee in earlier years and in AY 09-10 - Revenue has not brought any material to controvert the findings of CIT(A) – the order of the CIT(A) is upheld – Decided against Revenue.
|