Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2017 (1) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (1) TMI 1161 - BOMBAY HIGH COURTRejection of Books of Account - Percentage Completion Method of accounting followed by the respondent- assessee resulted in varying profits/income being offered for tax in different assessment years - Held that:- We are unable to understand the objection urged by the Revenue. The Percentage Completion Method of accounting itself implies that the profit/income offered to tax would depend upon the percentage of a particular project being completed. This would necessarily vary from year to year and there is no requirement that it should be the same percentage year to year. There is no bar in adoption of one method of accounting for one source of income/business and another for the other, so long as it is regularly employed and results in appropriate determination of income. Tribunal was justified in sustaining the order of the Commissioner of Income Tax (Appeals) (CIT(A)) holding that the rejection of Books of Account in terms of Section 145 of the Act was not justified Disallowance of business expenditure - Held that:- We find that once the accepted Books of Accounts have been admittedly subjected to audit, then expenses claimed therein have to be allowed. Unless of course, it is the Revenue's case that the expenses were not incurred for the purposes of the business or that the expenses were bogus. Even before us the Revenue does not urge that the expenses claimed were bogus and/or not incurred for the purpose of business. Depreciation in respect of equipment, plant and machinery used in assessee's hotel business and also the loss claimed from its Hotel business - Held that:- We note that the Assessing Officer had in the respondent-assessee's appeal before the CIT(A) had filed a remand report. In the remand report no objection was taken to the evidence led by the respondent-assessee to show that the hotel business had commenced from 17th January, 2004 as well as the plant and machinery and equipment have been put to use during the subject assessment year. Thus entitled to depreciation at 50% as only used for less than 180 days. As the CIT(A) and the Tribunal have come to a concurrent finding of fact that the business is started on 17th January, 2004 and the equipments on which depreciation has been claimed has been used in the running of the hotel business and not shown to be perverse in any manner and the questions (iii) and (iv) as formulated does not give rise to any substantial questions of law. Thus not entertained.
|