9911796707
TMI Blog2012 (10) TMI 534X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the Revenue is that the CIT(Appeals) has erred in deleting the addition towards provision made by the assessee for maintenance work amounting to Rs.3.5 crores. 3. The brief facts of the case may be noticed as follows. 4. The Assessee is engaged is engaged in the business of Real Estate. It filed its return on 1.11.2004 admitting income of Rs.11,66,627/-. The Assessing Officer completed assessment under sec.143(3) of the Act on 18.12.2006 determining taxable income as Rs.8,37,10,200/-. The Assessee preferred appeal before the CIT(Appeals) which was partly allowed in respect of claim towards provision for meeting cost of unfinished portion of the project, being accepted as Rs.7,23,50,000/-. 5. The Revenue filed appeal against the ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tter as directed and observed that during the period under reference the Assessee company had debited an amount of Rs.46,27,40,628/- towards cost of project in progress including an amount of Rs.7,23,50,000/- towards provision for various expenses. In support of this claim, the Assessee also furnished copy of ledger account in respect of different flats for the period from 01.4.203 to 31.3.2005 and submitted that the project in progress completed within the meaning of Accountancy Standard 7 as prescribed by ICAI and also tendered an explanation that the actual expenditure incurred by the company had far exceeded the provision made. 8. Regarding maintenance Assessee's plea was that the same had been carried on from 01.4.2004 to 31.12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Assessing Officer held that the same could not be treated as having been incurred for the purpose of maintenance. In this manner, the Assessing Officer made addition of Rs.3.50 crores by holding that the provision made by the Assessee was not allowable expenditure under sec.36 and of the Act. In this manner, that the Assessing Officer assessed the Assessee's income as Rs.4,63,60,200/-. 9. The Assessee carried the matter before CIT(Appeals) in appeal wherein its plea of having incurred the additional amount of Rs.3.50 crores has been accepted by holding that the Assessing Officer's findings to the effect that there was no basis for estimating the maintenance expenses, was not as per true factual position. Whilst allowing the Assessee' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Assessee's case has been accepted by the co-ordinate Bench(supra). The only direction which was given to the Assessing Officer was to examine the expenditure claim on scientific basis. We find from the orders of Assessing Officer as well as CIT(Appeals) that the only thing which has been considered is that the Assessee had incurred the expenditure which stood declined by the Assessing Officer by holding that the same is not covered by sec.36 and 37 of the Act whereas the CIT(Appeals) has agreed to Assessee's plea by applying sec.37(1) of the Act. Admittedly, the Assessee had transferred its maintenance account with effect from 01.1.2006. Thereafter, the sum of Rs.2,27,50,000/- is stated to have been spent by the Assessee's sister con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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