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2014 (1) TMI 400 - AT - Income TaxWhether revenue be recognized on the basis of agreement to sell - Revision of order u/s 263 - Held that:- Following Padmasundara Rao v. State of Tamil Nadu [2002 (3) TMI 44 - SUPREME Court] - Through the Agreement of Sale dated 2.11.2005, the assessee is entitled to receive Rs. 5,01,60,000/- towards sale consideration of the property and it is accrued to the assessee as the assessee has right to receive the same - As the assessee has been following the mercantile system of accounting and the whole amount of sale should be considered as accrued to the assessee - The CIT is justified in directing the Assessing Officer to examine the issue afresh - The Sale Agreement cited supra is not yet cancelled and it is still in force. It is valid and enforceable by law. If there is any dispute it could be settled mutually or before a court of law - During the financial year relevant to assessment year nothing has been brought on record to show that the Sale Agreement has become invalid or cancelled or advance money has been refunded by the assessee to the purchaser - Decided in favour of Revenue.
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