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2012 (4) TMI 51 - HC - Income TaxMethod of accounting - works contract – denial of project completion method – rejection of books of account – addition made - assessee have shown running payment and expenses against WIP in Balance sheet and excluded it from P/L A/c - Held that:- CIT(A) while confirming addition made contradictory statements – on one hand allowed project completion method & on other hand denied it. Accordingly, it is clarified that in case assessee had not claimed loss in the P/L A/c, the same will not be reduced. In case he had claimed this loss, it will be disallowed. Also, amounts related to payments received/bills raised and the expenditure incurred will be excluded from P/L A/c. Further, Completed contract method is not contrary and can be adopted and applied when an assessee follows mercantile system of accounting. However, we remand the matter to the tribunal to examine the other aspects relating to computation of taxable income on the basis of completed contract method – Decided partly in favor of assessee.
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