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2018 (7) TMI 1814 - AT - Income TaxUndisclosed income - Addition on money received on sale of flats - method of accounting of the project - Held that:- In the case of Runwal Homes Pvt Ltd (2017 (12) TMI 1216 - ITAT MUMBAI), we are of the considered view that the AO was erred in quantifying undisclosed income by taking average rate of ₹ 21,400 per sq.ft. and applying such rate to 21 flats without any evidence found as a result of search. Hence, direct the AO to restrict the quantification of undisclosed income to the extent of incriminating material found as a result of search. We further direct the AO to delete addition made towards on-money received from sale of flats in the impugned assessment year and make addition in the year in which the project has been completed, since the assessee is following project completion method for recognition of revenue. Hence, we set aside the issue for the limited purpose of quantification of undisclosed income on the basis of incriminating material found as a result of search and to make addition in the year in which project is complete. In the result, the appeal filed by the assessee is partly allowed, for statistical purpose.
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