TMI Blog2020 (10) TMI 978X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee firm has been consistently following the same accounting policy for recognition of revenue, which has even been accepted in the past, therefore, there is no justification, on the part of the ld. AO to disturb the accounting policy adopted and thereby apply Percentage Completion Method for the relevant previous year. No infirmity in the order of the CIT(A) in holding that the assessee was consistently following the project completion method and income has been properly estimated accordingly. Accordingly, we uphold the order of the ld. CIT(A). Appeal of the revenue is dismissed. - ITA No. 920/JP/2019 9 (Assessment Year :2015-16) - - - Dated:- 14-9-2020 - SHRI RAMESH C SHARMA, AM AND SHRI SANDEEP GOSAIN, JM Revenue by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h financial year as the project spreads in series of financial years. During the course of assessment, the AO concluded that the assessee had failed to maintain its accounts in a manner which could present 'true and fair picture' of its accounts and financial transactions, thereby contravening the provisions of Sec. 145(2) of the Act. Further, the AO held that the assessee by following project completion method had not declared complete and correct profits and at the same time by not following AS-9 AS-7, which tantamount to not following AS-1 as per Section 145(2) of the Act, therefore, the books did not represent true and fair picture and thus, the AO rejected the books of accounts u/s 145(3) of the Act and percentage completion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee firm, ₹ 62,00,000 was refunded to the customer in subsequent period. 5. We found that the assessee firm was engaged in the business as a Real Estate Developer. Thus, Accounting Standard 7, on Construction Contracts, issued by Institute of Chartered Accountants of India, was not applicable on the assessee firm. AS-7 is only applicable to Construction Contractors and not to Real Estate Developers. Similar to the year under appeal, assessee firm in the preceding years, as well as in the subsequent years, recognized its revenue, on a consistent basis, at the point of time when the sale deed was registered or final payment received and possession of the property was handed over to the buyer, whichever was earlier. These fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e completed contract method and because of such acceptance, the assessees, in these cases, have followed the same method of accounting, particularly in the context of chit discount. Every assessee is entitled to arrange its affairs and follow the method of accounting, which the Department has earlier accepted 8. In view of the above discussion, we do not find any infirmity in the order of the ld. CIT(A) in holding that the assessee was consistently following the project completion method and income has been properly estimated accordingly. Accordingly, we uphold the order of the ld. CIT(A). 9. In the result, appeal of the revenue is dismissed. Order pronounced in the open court on 14th September, 2020. - - TaxTMI - TMITax - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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