TMI Blog2018 (8) TMI 440X X X X Extracts X X X X X X X X Extracts X X X X ..... tently followed completed project contract/percentage completion method as recognized its revenue at the time of execution of getting the sale deed registered and before that it has to be consistently showing the advance from sale of flats as the liability in the balance sheet. A.O was not justified in applying the percentage completion method on the assessee merely on the basis that it was followed by the developer JSM DPL and arbitrarily making addition to the income ignored the fact that project completion method/ completed contract method of accounting has been consistently adopted by the assessee and even have been accepted by the revenue authority for the A.Y. 2010-11 and A.Y. 2011-12. We therefore set aside the findings of Ld.CIT(A) and delete the addition of ₹ 16,12,34,754/- for Assessment Year 2012-13. - Decided in favour of assessee - ITA No.121/Ind/2016 And 686/Ind/2016 - - - Dated:- 3-8-2018 - SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER For The Revenue : Shri K.G. Goyal, Sr.DR For The Assessee : Shri P.M.Choudhari, ORDER PER MANISH BORAD, AM. These two appeals filed by the assessee pertaining to the A.Y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar under consideration. The addition is thus excessive and unreasonable. 3. Assessed has also filed appeal for A.Y 2013 14 raising similar grounds against the addition of ₹ 12,25,55,171/- confirmed by Ld. CIT(A). 4. From the perusal of the above grounds for both the years the issue needs to be adjudicated is whether both the lower authorities were justified in confirming the addition by applying the percentage completion method as against the project completion method/ completed contract method adopted by the assessee thereby showing the revenue on the basis of the sale deeds registered. As the issue raised in the appeal are common and pertaining to the same assessee, they have been heard together and are been disposed off by this common order for the sake of convenience and Brenaty. For the purpose adjudication we will take up the facts for A.Y. 2012-13 as the basis and our decision shall apply to the appeal for A.Y. 2013-14 also. 5. Briefly stated facts as culled out from the records are that the assessee is engaged in the business of purchase/sales/development of land, real estate and infrastructure and construction and civil work. Search and Seizure operations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.Y 2011-12 A.Y 2012-13 A.Y. 2013-14 Opening Balance 19,00,000 3,23,35,702 7,52,36,466 Add: Share of advance receivable 4,84,35,702 6,53,00,764 5,23,49,207 Less: Amount Received 1,61,00,000 2,24,00,000 2,88,50,000 Closing Balance 3,23,35,72 7,52,36,466 9,87,35,673 6. As at 31st March, 2013, the assessee company has reflected an amount of ₹ 9,87,35,673/- receivable from M/s. Devcon Private Limited. In order to examine the transaction, details were called from M/s. JSM Decon Private Limited u/s 133(6) of the I.T. Act. In response to the said notice, M/s JSM Devcon Private Limited submitted copies of ledger account of the assessee company in the books of M/s. JSM Devcon Private Ltd. 7. It was submitted by the assessee during the assessment proceedings that it is consistently following project completion method and has offered the revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cuted at the time of full payment coupled with possession of the opartment. ii)Advances have been received from various customers on the basis of schedule given in the allotment letter which specifies that installment shall be paid on completion of a particular level of activity. The amount so received is liable to refund and the possession shall be given at the time of execution of the sale deed. iii) In the transaction of advance received from customer, there is no transfer of property as envisaged in Sec. 2(47) of The Income Tax Act, 1961 read with section 53A of Transfer of Property Act, 1882. iv) Similar type of accounting method (mercantile) has been followed by the assessee from year to year. 4.1 The Assessing Officer did not accept the appellant's contentions for the following reasons:- i) The assessee has stated that the revenue is recoqnized on execution of the sale deeds. In this respect, it is once again reiterated that the assessee company has entered into a joint venture agreement with M/ s JSM Devcon Private Limited in which the project was to be developed by,the said party and : the entire revenue of the project shall be shared betw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nue recognition, which shall be binding on assessee as well, as it is dependent on the developer on all the activities. Thus, the argument of the assessee that revenue is recognized on the basis of sales deed executed at the time of full payment coupled with possession of the apartment does not hold ground. iv) The assessee profit and loss account ces it reliance on the allotment letter Issued by 11'1/ s LlSM Devcon Private Limited as per which the amount received as ad.uance is liable to refund and the possession shall be given at the time of execution of the sale deed. As has been discussed earlier the risk and reuiard s of the traneaction has been shifted to buyer on the date of entering into the agreement. The buyer is at liberty to sell the interest in the flat to another person us per his will and receive the consideration. Similarly, the buyer is at liberty to cancel the booking and shall get the amount paid after de du ction of pre scribed amounts. Once the risk and rewards are transferred, the pendency of certain things does not affect the transaction. v) The assessee has contested that there is no transfer of the property as envisaged u/ s 2(47) read with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gards the assessee argument that it has been recognising the revenue on the same line from years to years, it will be sufficient to state that the submission of the assessee is not as per records. On examination of the balance sheet of the assessee for the various years, it can be seen that the assessee has not recognized any revenue. Thus, the assessee submission that the practice is being regularly followed by it is also not established. 4.2 The appellant company had acquired 2.039 Hectare of agriculture land on 23.03.2009 and the said agriculture land was given approval for housing development in the master plan. The appellant company entered into a development agreement on 01.04.2009 with Mj s JSM Devcon Pvt. Ltd. and as per the terms of the agreement the Developer, Mj s JSM Devcon P.vt. Ltd. had to construct High Rise Buildings on the said land and in consideration the appellant company was entitled to receive 32% of the total flats constructed. '': 4.3 The appellant company is maintammg its books of accounts on Mercantile System of Accounting and revenue has been recognized on accrued basis, except certain income. In the notes on accounts, under the revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to expect ultimate collection. If at the time of raising of any claim it is unreasonable to expect ultimate collection, revenue recognition should be postponed. 11. In a transaction involving the sale of goods, performance should. be regarded as being achieved when the following conditions have been fulfilled: the seller of goods has transferred to the buyer the property in the goods for a price or all significant risks and rewards or ownership have been transferred to the buyer and the seller retains no effective control of the goods transferred to a degree usually associated with ownership; and no significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of the goods. . 4. 7 Considering the revenue recognition Principles prescribed in AS-9, the real estate . sale takes place at a point of time when all significant risks and rewards of ownership are transferred as per the terms and conditions of the agreement to sell. The event of entering in to Agreement to sell is to be construed as having the effect of transferring of the significant risks and rewards of the ownership to buyers, provided, the agreement is legally ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se before the transfer of title in such goods to the buyer, It is because that till that time, the buyer does not acquire any risks and rewards attached to the product, which pass only with the sale. But, if the product under sale is of a unique nature, such as, a commercially constructed unit, for which the developer has entered into agreement for ' sale at the initial stage of construction by transferring all significant risks and rewards of the ownership to the buyer, the income accrues on year-to-year, basis by considering the percentage of completion of the property under transfer. It is so for the reason that after signing agreement to sell, the developer acquires an infallible right over the payments received towards sale consideration which coincide with the progress in construction. The buyer simultaneously acquires ownership of the right in the property much before the transfer of legal title in his favour. Such a right in the hands of buyer is a valuable right capable of transfer to any third person at any stage of construction. As such, it is wrong to say that no profit accrues to the developer/builder till the execution of registered sale deed. The positio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n favour of the buyer could not be regarded to be either cash or mercantile system of accounting. Further, it is important to note that the appellant company has not received 32 of the completed flats and then entered into agreement to sell. M/ s JSM Devcon Pvt. Ltd. entered into agreements to sell for 32 of the appellant company's share as well and accordingly transferred 32 of the monies received to the appellant's account. The Developer, M/s JSM Devcon Pvt. Ltd. after considering all the factors has adopted Percentage Completion Method for revenue recognition, which shall be binding on the appellant company as well, as it is dependent on the Developer for all the activities. 4.11 Reliance is also placed on the following decisions:- i) DCIT vs. Sudhit V. Shetty (2014) 50 Taxmann.com 372 (Mumbai-Trib) ii) ACIT vs. Alcon Develpoers (2015) 54 Taxmann.com 54 (Panaji-Trib) iii) ACIT vs. Paras Build call Pvt. Ltd. (2015) 57 Taxmann.com 112 (Delhi- Trib) iv) Prestige States Project Ltd. 129 ITD 342 (Banglore-Trib) 4.12 M/s JSM Devcon Pvt. Ltd has recognized revenue of ₹ 35,47,19,797/- in the F.Y. 2011- 12 and ₹ 26,96,23,914/- in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment agreement which was entered into in to receive 32% of the constructed salable area. He also appraised that the assessee company is following mercantile system of accounting and books of accounts are duly audited under the provision of IT Act and Company Act. It is consistently adopting the accounting system of project completion method and for the A.Y 2011-12 also he has disclosed the advance received from the buyers as liability and no addition has been made by the revenue authorities during the assessment for the A.Y. 2011-12 and the method adopted by the assessee has been accepted. By maintaining the same consistency the assessee prepared the financial statement for A.Y 2012-13 and onwards. As regards the action of Ld.AO adopting the percentage completion method followed by the developer company i.e. JSM DPL, he humbly submitted that a person is free to adopt one of the prescribed method of recognizing the revenue as provided under the provisions of law and it was not mandatory on the part of the assessee to follow the system of accounting adopted by the Developer. He further submitted that as per the settled legal position according to provisions of Section 145 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... departure made by section 13 of 1922 Act from tax legislation in England is that whereas under English legislation the commissioner is not obliged to determine profits of a business venture according to method of accounting adopted by the assessee , under the Indian Income Tax Act , prima-facie , the ITO has for purposes of section 10 12 of 1922 act to compute income , profits and gains in accordance with method of accounting regularly employed . If, therefore, there is a system of accounting regularly employed and by appropriate adjustments from the accounts maintained taxable profits may be properly deduced , the ITO is bound to compute profits in accordance with method of accounting. but where in the opinion of ITO , the profits cannot be properly deduced from eth system of accounting adopted by assessee it is open to him to adopt a more suitable basis for computation of true profits . Their Lordships then also dealt with method of accounting and observed as under- among Indian businessmen as elsewhere, there are current two principle systems of book keeping , there is , firstly, the cash system in which record is maintained of actual receipts and actual disburs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said years on the basis that revenue in respect of sale of said flats would be recognized only on execution and registration of sale deeds of flats. The assessment of the said years have been completed by AO by the same common order, accepting the method of accounting and method of recognition of revenue. Thus the method followed by appellant is a consistent method which has been even accepted by AO for two years i.e. AY 2010-11 2011-12 . Since the said method has been consistently followed by appellant and even accepted by department, the same cannot be deviated in the present two years without there being any finding as contemplated u/s 145(3) and since there is no finding as contemplated by section 145(3) on the basis of satisfaction required by that section viz., (1)about correctness or completeness of the accounts of the assessee or (2) about the fact that the assessee has not regularly employed the method of accounts provided in section 145(1) or (3) that the income has not been computed in accordance with the standards notified u/s 145(2) , the assessment of the appellant has to be made as per method adopted by it. The appellant further submits that even in case covered b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e their Lordship s, their lordships in view of the retention clause came to conclusion that when there was a stipulation in the contract postponing the time for payment of the whole or part of the balance , until after the expiration of period during which contractor was liable for defects or for repairs payment would not have become due for the contractor. It is further held that what is the nature of contract and whether money had become due would have to be ascertained by interpreting all the relevant terms and by finding out the exact practice followed by department. Whether there was certificate for payment , if so whether it was a final certificate , and even in cases where there had been a final certificate whether there was a further stipulation for retention , would all have to be examined to find out whether money had become due. 14. The Ld. Counsel for the assessee further submitted that aspect of mere postponement of tax as a result of method employed by assessee has not been viewed adversely by courts so long as the method is regularly and consistently employed as is clear from the above decision of Apex court in the case of Excel Industries Ltd (Supra) . The same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se also since no finding as is contemplated u/s 145(3) has been recorded by AO, under the circumstances, the substitution of method from completed contract method to percentage completion method only on the basis of the method followed by developer JSM Devcons Pvt. Ltd , is clearly contrary to law as well as judicial pronouncements . The order thus deserves to be set aside. The appellant also relies upon following decisions where project completion method has been considered to be recognized method and if consistently followed, the AO is bound to assess the income of the assessee on that basis. a) Decision of Gujarat High Court in the case of Manjusha Estates (P) Ltd Vs ITO reported in (2017) 393 ITR 644 . b) Decision of ITAT- Mumbai in the case of Prem Enterprises Vs. ITO reported in (2012) 25 Taxmann.com 179 (Mumbai) c) Decision of High Court of Punjab Haryana in the case of CIT Vs. Principal Officer, Hill view Infrastructure reported in (2016) 384 ITR 451- Follows CIT Vs. Bilahari Investment (P) Ltd. reported in (2008) 299 ITR 1 (SC) d) Decision of ITAT-Mumbai in the case of Hardware Infrastructure P. Ltd copy at page 346 of paper book e) Decision of ITAT- Ahmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant s right to get 32% of the area would crystallize / accrue on completion of the entire construction and till then owner has no right to claim any right over any of the constructed portion. (ii) Clause (7) of the agreement specifies the period for construction of buildings according to which the developer is required to complete the construction within 54 months ( subject to a grace period of 6 months ) from the date of handing over of the possession by owner and obtaining necessary permissions, approvals, NOCs etc . The developer is thus required to handover the landowner s share of 32% of the completed constructed saleable area within 60 Months from above date failing which the developer is required to first allocate 32% area to the land owner out of the area constructed till then. This has been stated to be an essential condition of the agreement. The failure of developer to give such 32% area, makes the developer liable to pay interest @ 12% p.a. on the remaining area. A closure study of the agreement thus shows that appellant s right to get 32% of the constructed area would crystallize only on completion of construction and demarcation / division as per clause (9) or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the entire construction by developer or upon completion of the period of 60 months from the date of handing over of the possession of the land by the appellant land owner along with necessary permissions , NOCs etc , whichever is earlier. 22. It is further observed that the assessee follows mercantile system of accounting and since during the years under consideration, the construction on the lands handed over to the developer for development and construction was not completed but the appellant had merely received advances from the proposed buyers, no revenue was recognized by appellant and the advances received against proposed sales were credited in advances against sale of flat account and shown as liability in the Balance Sheet. At this stage it may be relevant to note that since as per the agreement, exclusive right of sale was given to the developer M/s JSM Devcons Pvt. Ltd., the advances against sales were to be received by appellant through the developer, as such the accounting in that respect has been done accordingly. It may further be relevant to mention that the appellant started receiving advances against the sales from A.Y. 2010-11 which have been duly refl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g method adopted consistently just for the basis of the value of construction completed during the year and on the basis of the ratio agreed in the development agreement of 68:32, calculated the addition of ₹ 16.12 crores (approx) for A.Y. 2012-13 and ₹ 12.25 crores for A.Y 2013-14. 26. When the matter came up before the CIT(A) he also confirmed the addition without considering the fact that assessee is the land owner who has assigned the development right in favour of the developer on the terms and conditions specified in the agreement between the parties. We find that the assessee is entitled to the possession of its share of 32% of constructed area only upon completion of entire construction and before that the assessee has no right to claim possession of its 32% constructed area which is required to be completed within 60 months from the date of handing over of possession of land along with all necessary permissions/approvals. The period of 60 months taken from the date of agreement shall end on 31.3.2014 and the assessee still have the right to sale the completed area as per agreement thereafter. 27. To summarize the facts we find that the assessee got the ri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is free to employ for the purpose of his trade , his own method of keeping accounts, and for that purpose to value his stock-in-trade either at cost or at market price. A method of accounting adopted by the trader consistently and regularly cannot be discarded by departmental authorities on the view that he should have adopted a different method of keeping accounts or of valuation. The method of accounting regularly employed may be discarded only , if , in the opinion of taxing authorities , income of the trade cannot be properly deduced there from ( as per provisions of 1922 Act in force at that time , presently only if case falls in sub section (3) of section 145 ) . 30. Further in another judgment of Hon ble Supreme Court in the case of CIT V/s Krishna Swamy Mudiliar reported in (1964) 53 ITR 122 (SC) , their Lordship s of Apex court while dealing provisions of section 13 of 1922 Act (the provisions of which are in pari-materia of section 145 of 1961 Act) have held as under: Section 13 of 1922 Act merely prescribes that the computation of taxable profits shall be made according to the method of accounting regularly employed. Where in the opinion of the ITO the income , p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the situation wherein the AO is permitted to intervene, in case it is found that true income profits and gains cannot be arrived at by the method employed by assessee. Their Lordship s further held that the position of law is further well settled that regular method adopted by assessee cannot be rejected merely because it gives benefit to assessee in certain years. 32. Examining the facts of instant appeal we in light of above judgments we find that the method of accounting along with following project completion method for treatment of advances received from proposed buyers the assessee has been consistently followed this method and appellant s assessment has been completed by the Ld. AO for first two years viz, A.Y. 2010-11 2011-12. In both these years also the appellant has credited the advance received against proposed sales of flats to a separate account and shown as a liability in balance sheet . At this stage it may be relevant to mention that in those years also the appellant has credited the advance received against proposed sale of flats to the Advance against sale of Flat A/c and not treated the same as income for said years on the basis that revenue in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lar issue observed as follows; On the Revenue s appeal, the Tribunal confirmed the view of the Commissioner of Income Tax (Appeals), however, on slightly different ground, namely, that the assessee being a developer of the project, profit in his case, will arise on transfer of title of the property and receipt of any advances or booking amount cannot be treated as trading receipt of the year under consideration. The Tribunal further noted that such method of accounting followed by the assessee had been accepted by the Revenue in earlier years. The Tribunal was, therefore, of the opinion that the Assessing Officer s decision to reject the book results during the year under consideration was not justified. We are of the opinion that the Tribunal committed no error. If as per the accounting standard available, the assessee was entitled to claim the entire income on completion of the project and if such accounting standard was accepted by the Revenue in the earlier years, in the present year, the Assessing Officer could not have taken a different sand and that too, without hearing the assessee . 35. Further in another judgment by CIT Vs. Umang Hiralal Thakur (2014) 42 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch attained finality as it is not challenged by the department before the high forum observed as follows; The learned Departmental representative supported the order of the learned Assessing Officer and the learned authorized representative of the assessee supported the order of the learned Commissioner of Incometax (Appeals) and also placed reliance on the Bangalore Bench of the Tribunal in the case of Nandi Housing P. Ltd v. Deputy CIT (2003) 80 TTJ (Bang) 750, wherein the Tribunal followed the decision of the Karnataka High Curt in the case of Khoday Distillers Ltd, in ITRC Nos. 19mto 21 of 1993. This, it is observed that the issue which requires our adjudication is that the income in the instant case is to be computed as per system of accounting followed by the assessee or as per accounting followed by the assessee or as per accounting standard AS7 for the purpose of charging of income tax. We find that the issue is to be decided in accordance with the provisions of section 145 of the Act shows that the business income which is assessable under the Income tax Act is to be computed in accordance with the consistent system of accounting followed by the assessee unless such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no reason to see to interfere with the impugned judgment and order passed by the learned Commissioner of Income tax (Appeals) deleting the addition of ₹ 1,66,70,881 which was made by the Assessing Officer on rejecting the accounting system on percentage completion method followed by the assessee. No question of law much less any substantial question of law arise in the present appeal. Hence, the present appeal deserves to be dismissed and is accordingly dismissed. 37. We further find the co-ordinate bench of Mumbai in the case of Prem Enterprises V Income Tax Officer (2012) 25 taxmann.com 179 (Mum.) deal with the similar issue wherein the assessee was constructing a project and was consistently following project completion method and the assessing officer rejected the method of project completion adopted by the assessee on observing that 8% of the total project has been incurred up to the relevant assessment year the income should have declared on the percentage completion method. The Co-ordinate Bench decided in favour of the assessee holding that the results declared by the assessee on the basis of method of accounting consistently followed and the entire profit of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zed methods of accounting. That it cannot be said that the project completion method followed by the assessee would result in deferment of payment of taxes. Therefore, considering the discussion above, I do not find any merit on the part of the AO to have worked out the income by applying the percentage completion method . The Tribunal affirmed the order of the CIT(A). It was concluded that project completion method and percentage completion method are accepted standards of accounting and the assessee has option to adopt any one of them. The relevant findings recorded by the Tribunal read thus:- We have heard the rival contentions and perused the record. The issue arising in the present appeal before us is in relation to the method to be applied for recognizing the revenue generated by the assessee in the course of carrying on the business of real estate developers. The case of the assessee is that it is following one of the accepted accounting standards approved by ICAI for recognizing the revenue generated by it. The assessee had followed project completion method which had been consistently followed by the assessee for the preceding years also. The Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion contracts, the assessee can follow either the project completion method or the percentage completion method. Where the assessee was following a particular method of accounting consistently, which has been accepted by the department from year to year and in the absence of any defect being pointed out by the Assessing Officer that by following such method, income had escaped assessment, we find no merit in the order of the Assessing Officer in holding that percentage completion method should be applied to the assessee for the year under consideration. It is the prerogative of the assessee to arrange its affairs in such a manner and follow any recognized method of accounting to compute its profits. In view thereof, we find no merit in the order of the Assessing Officer in recomputing the income in the hands of the assessee. Upholding the order of Commissioner of Income Tax (Appeals), we dismiss ground of appeal raised by the revenue . The Delhi High Court in CIT v Manish Build Well (P) Ltd (2011) 16 taxmann.com 27(2002) 204 Taxman 106 noted that project completion method is one of the recognized methods of accounting. It was held as under:- It is well settle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st accounting period and transferred to the profit and loss account. The said method determines results only when the contract is completed. This method leads to objective assessment of the results of the contract. The On the other hand, the percentage of completion method tries to attain periodic recognition of income in order to reflect current performance. The amount of revenue recognized under this method is determined by reference to the stage of completion of the contract. The stage of completion can be looked at under this method by taking into consideration the proportion that costs incurred to date bears to the estimated total costs of contract. The above indicates the difference between the completed contract method and the percentage of completion method. (underlining ours) 40. After the above judgments of the Supreme Court it cannot be said that the project completion method followed by the assessee would result in deferment of the payment of the taxes which are to be assessed annually under the Income Tax Act. Accounting Standards 7 (AS7) issued by the Institute of Chartered Accountants of India also recognize the position that in the case of construc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned advances to tax in the subsequent years i.e. from financial year 2014-15 based on sale deed registered which proves that there has been no loss to the revenue. Mere postponement of tax as a result of method employed by assessee has not been viewed adversely by courts so long as the method is regularly and consistently employed as held by Hon ble Apex Court in the case of Excel Industries Ltd (2013) 358 ITR 295. 42. Before parting of with adjudication of this issue it would be relevant to take note of the amendment brought in statute with retrospective effect w.e.f. 1.4.2017 by way of insertion of Section 43CB for the purpose of computation of income from construction and service contract. The relevant provision of Section 43CB of the Act reads as follows; 43CB. Computation of income from construction and service contracts.-(1) The profits and gains arising from a construction contract or a contract for providing services shall be determined on the basis of percentage of completion method in accordance with the income computation and disclosure standards notified under subsection (2) of section 145: Provided that profits and gains arising from a contract ..... X X X X Extracts X X X X X X X X Extracts X X X X
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