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2019 (8) TMI 1843 - AT - Income TaxRevision u/s 263 - Taxability on estimated income from the development and construction project of building - Estimation of net profit by invoking provisions of Section 145 - Revenue recognition - addition made by the AO by applying percentage completion method delete by CIT - HELD THAT:- AO could not challenge the project completion method adopted by the assessee to the percentage completion method unless all significant risks and rewards of ownership have been transferred to the buyer and the seller retains no effective control of the goods transferred to a degree usually associated with ownership. The assessee has referred to BU permission etc. and has demonstrated on facts that the risks associated with the project continued with the developer in a significant way during the year under consideration. It is also not in dispute that the income has been ultimately offered in the later assessment year and duly assessed. Thus, the entire exercise of the AO is revenue neutral. The CIT(A) in our view correctly appreciated the facts and circumstances of the case and has taken note of the revenue recognition in the later year. We are unable to see any infirmity in the process of reasoning adopted by the CIT(A) while granting relief to the assesse. The assessee has also demonstrated that the revenue recognized from project has been actually assessed and accepted in 143(3) r.w.s. 263 of the Act proceedings. We thus see no merit in the appeal of the Revenue.
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