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2015 (4) TMI 791 - AT - Income TaxRevision of assessment order - Claim of provision for development expenses - Held that:- The first finding of the ld. CIT is to the effect that assessment order has been passed in a casual manner and without application of mind. In our consideration with the above correspondence, evidence and discussions during the course of assessment proceedings do not substantiate these adverse observations of ld. CIT. Consequently we are unable to agree that assessment order is erroneous or prejudicial to the interest of revenue on this score. The allowability of JDA development charges as business expenditure, ld. CIT has no objection on assessee’s following mercantile system of accounting in that eventuality even the accrued liabilities are to be allowed. Assessee has demonstrated that per square yard working of JDA expenses was provided to ld. AO during the assessment proceedings which is part of the record. Once the liability is accrued as per JDA circulars and AO allows the claim based on working provided by assessee; it demonstratively means that AO allowed the claim after due application of mind. Ld. CIT has not even disputed that liability is allowable as clearance has been give about liability qua the sale proceeds offered. It has been lost sight of that assessee follows mercantile method, liability is statutory and working of quantum is provided. With all this available on record we hold that the assessment order can neither be called as erroneous or prejudicial to the interest of revenue. Our views are fortified by the catena of judgment in DLF Ltd. [2012 (9) TMI 626 - DELHI HIGH COURT],Max India Ltd. [2007 (11) TMI 12 - Supreme Court of India] and Malabar Industrial Co. Ltd. [2000 (2) TMI 10 - SUPREME Court], consequently the 263 order is quashed and assessee’s grounds are allowed. - Decided in favour of assessee.
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