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2018 (2) TMI 1714 - HC - Income TaxTaxation on disputed amounts credited as project receipts to the profit and loss account - Held that:- We find that the impugned order of the Tribunal has restored the issues raised herein to the Assessing Officer for a fresh consideration. Mr. Pinto, learned Counsel appearing for the Revenue states that consequent to the restoration, the Assessing Officer has already passed an order dated 2nd March, 2015 in favour of the Revenue. No substantial question of law. Allowability of prior years expenditure - Method of accounting - Held that:- The respondent assessee is following the completed contract method. Therefore, the respondent assessee claims that his contract was completed in the subject assessment year and income was offered to tax after deduction of expenditure incurred over the entire period of the contract. It is not disputed by the Revenue before us that the respondent assessee has followed the completed contract method of accounting. Tribunal has correctly allowed the expenditure which was incurred and revenues earned in the earlier years during the progress of the contract as they are taken into account in the subject assessment year to determine its profits. Also this manner / method of determining profits stands concluded by the decision of the Supreme Court in Commissioner of Income Tax Vs. Bilahari Investment P. Ltd. [2008 (2) TMI 23 - SUPREME COURT] as held as under the completed contract method, the revenue is not recognised until the contract is complete. Under the said method, costs are accumulated during the course of the contract. The profit and loss is established in the last accounting period and transferred to the profit and loss account. The said method determines results only when the contract is completed. No substantial question of law.
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