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2011 (12) TMI 346 - AT - Income TaxTaxability of project - relevant assessment year - held that:- Once the income from the project is taxed, the Assessee will have no occasion to claim expenses relating to that project in a later assessment year. In this regard, we also find that the CIT(A) has accepted that fact that the Assessee has got his share of flats in Building No.1 and one flat in Building No.2 also and both have been sold and the sale proceeds shown in the profit and Loss account. As far as Building No.2 is concerned, the Assessee no longer has any interest in the same. It is for M/S.Audumber Construction Co. to complete Building No.2 and deal with it. The Assessee has nothing to do with that building. In that view of the matter, we hold that income from the project, as far as the Assessee is concerned, has to be assessed in this assessment year viz., AY 05-06 on a substantive basis, by treating the project, as far as the Assessee is concerned, as complete. Expenditure on account of providing alternate accommodation to tenants of the old building - outstanding liability - The AO was of the view that what the assessee is doing not the estimation of profit but the estimation of expenses. The liability was not even an ascertained liability but only estimation. - AO rejected the books of accounts - held that:- in respect of providing alternate accommodation, it is for the Assessee to choose the manner in which it gives the old occupants of the land, alternate accommodation. The AO cannot sit in judgment over the business decision of the Assessee and say that the Assessee should have given alternate accommodation to the old occupants of the land only from his share of built up area received from the subdeveloper. - The AO will examine the expenses and on the Assessee showing correlation of the actual expenses with the expenses actually claimed by way of provision during the previous year, the AO will allowe them as deduction. - Matter remanded back to AO.
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