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2021 (11) TMI 104 - AT - Income TaxAddition made on account of recognition of revenue on the basis of POCM of the project - CIT-A deleted the addition - as per Revenue that the assessee ought to have recognized Revenue on the principles of POCM - HELD THAT - No infirmity into the above findings of Ld.CIT(A) as the assessee has been applying consistently the same method since inception. Moreover Ld.CIT(A) has recorded the fact that the assessee has been adopting the same method of accounting which was accepted by the Revenue. Further it is also recorded by Ld.CIT(A) that the Assessing Officer committed error in computing the construction and development cost incurred by the assessee till 31.03.2014. As per Ld.CIT(A) the cost was only 18.40% of the total estimated construction and development cost. Therefore no revenue could have been booked even as per the guidance note issued by ICAI. This finding of fact is not rebutted by the Revenue. Thus Ground No.1 raised by the Revenue is devoid of any merit hence dismissed. Addition on account of brokerage expenses - assessee company had not declared any income from the projects undertaken during the year under consideration - As per AO Expenditure should have been treated as work in progress - CIT- A deleted the addition - HELD THAT - No infirmity in the order of Ld. CIT(A) as the CIT(A) has correctly appreciated the facts in the light of ratio laid down by the Hon ble Jurisdictional High Court rendered in the case of CIT vs Samsung India Electronics Ltd . 2013 (7) TMI 335 - DELHI HIGH COURT and ESPN SOFTWARE INDIA P. LTD. 2008 (3) TMI 90 - DELHI HIGH COURT - Revenue could not rebut the finding of Ld.CIT(A) that brokerage forms part of selling cost therefore allowable expenditure. The Ground No.2 raised by the Revenue is dismissed. Interest free advance given to group companies - HELD THAT - CIT(A) has categorically given a finding that from the financial statement it was observed that interest was paid to Greater Noida Authority for late payment of installment of the land purchased on deferred credit. It was also recorded that the advances given to the associate concern was out of interest free advances received from booking of the flats. This finding on fact was not rebutted by the Revenue by furnishing any contrary material. Therefore no interference is called for in the decision of Ld.CIT(A) the same is hereby affirmed.
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