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Commissioner of Income Tax 10 Versus IOT Infrastructure & Energy Services Ltd.

2016 (5) TMI 220 - BOMBAY HIGH COURT

Disallowance u/s 14A - Held that:- Issues stands concluded in favour of the respondent-assessee and against the Revenue by virtue of the decision of this Court in Godrej & Boyce Mfg. Co. Ltd. Vs. Deputy Commissioner of IncomeTax and another [2010 (8) TMI 77 - BOMBAY HIGH COURT] .

Amounts received from various public sector companies - whether were only advances and not receipts of income? - Held that:- We find that the respondent-assessee follows the mercantile system Accounting and .....

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y advances and not receipts of income, based on the percentage completion method followed by the Company

Appeal admitted on substantial questions of law at question nos. (iii) and (iv).

(iii) Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in upholding the orders of the CIT(A) in regard to the liability on account of warranties?

(iv) Whether on the facts and in the circumstances of the case and in law, the Tribunal .....

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impugned order is in respect of Assessment Year 200708. 2. This appeal raises the following questions of law for our consideration : ( i) Whether on the facts and in the circumstances of the case, the Tribunal was in error in restricting the disallowance made by the AO as per Rule 8D, unmindful of the fact that the Rule was to enable the working of the Section 14A? (ii) Whether on the facts and in the circumstances of the case and in law, the Tribunal was in similarly restricting the disallowanc .....

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Tax Act? (v) Whether the Tribunal was correct in its decision that the amounts received from various public sector companies were only advances and not receipts of income, based on the percentage completion method followed by the Company? 3. Regarding Question Nos.(i) & (ii):Mr. Suresh Kumar, the learned counsel for the Revenue very fairly states that both these issues stands concluded in favour of the respondentassessee and against the Revenue by virtue of the decision of this Court in God .....

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to the extent the work was completed as reflected in the progress bills issued to its clients. This method of offering of income to tax was not on the quantum of the amount received but an amounts relating to miles stones achieved in terms of the contract between the parties. The amounts in excess of that billed was shown as advance. The assessing Officer as well as the CIT (A) disallowed the same and sought to bring the entire amount received during the subject assessment years to tax with no .....

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