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2017 (5) TMI 252 - AT - Income TaxDisallowance of land development expenses - expenses originally shown payable but subsequently claimed to have been credited to work-in-progress - CIT-A deleted the addition - Held that:- No specific error in the order of the CIT(A) could be pointed out by ld D.R. in the findings of the CIT(A) that the development expenses debited to profit and loss account was wrongly credited to ‘payable’ account instead of crediting it to the ‘work-in-progress’ account, which was rectified by the assessee in the subsequent accounting year and that it had no effect on the profitability reflected in the profit and loss account. CIT(A) has also given a finding that the assessee during the year has recognized revenue in respect of area of 25,892.22 sq.ft in the year under consideration and the development expenses of ₹ 41,57,264/- claimed in the profit and loss account also pertains to the area sold during the year. This finding of the CIT(A) has also remained uncontroverted by ld D.R. Further, the CIT(A) has relied on the decision in the case of Calcutta Co. Ltd (1959 (5) TMI 3 - SUPREME Court ), wherein, it was held that the assessee claimed estimated expenditure towards development of the plots sold during the year, even though no part of that amount represented any expenditure actually made during the year. It was held that there was a certain and accrued liability and the estimated expenditure required to discharge the liability will have to be deducted. - Decided against revenue
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