TMI Blog2022 (3) TMI 175X X X X Extracts X X X X X X X X Extracts X X X X ..... he right to receive such retention money. Thus, it was held that when the bills were submitted having regard to the nature of the contract, no enforceable liability accrued or arose and, accordingly, it could not be said that the assessee had any right to receive the entire amount on the completion of the work or on the submission of the bills. It was held that the assessee had no right to claim any part of the retention money till the verification of satisfactory execution of the contract. The above decision would apply with full force to the case on hand. That apart the CIT(A) as well as the tribunal have examined the sample contract produced by the assessee which they have entered into with the third party customers/parties and found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of disallowance of retention money amounting to ₹ 7,72,10,900/- added back during assessment ? C. Whether the Learned Tribunal has committed substantial error in law by not considering the CBDT s Circular No.22/2015 dated 17.12.2015 which has specifically directed assessing officer to allow credit of employees contribution to provident fund or superannuation fund or any other fund for the welfare of employees, by invoking the provisions of Section 43B of the Income Tax Act, if the same has been paid after due date ? D. Whether the Learned Tribunal has committed substantial error in law by not considering that CBDT s Circular No.22/2015 dated 17.12.2015 which clarified that the Circular does not apply to claim of deduction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sue is around ₹ 6 lakhs and the appeal cannot be pursued further by the revenue on account of low tax effect. In such event, we will have to leave the question open as the said question is now pending consideration before this Court in other appeals which have been entertained. With this prelude we proceed to consider the second issue regarding the disallowance of retention money. The assessee s case was that the retention money is payable after certain period of time on the satisfactory performance of the contract executed by the parties as per the terms of the agreement and could not be said to be accrued to the assessee at the time of raising invoice and could be said to be accrued only after the customer accepts its claim fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deration of the order passed by the tribunal in the assessee s holding company, M/s. Mc Nally Bharat Engineering Co. Ltd. Kolkata in ITA No.100/Kol/2011 wherein the tribunal dismissed the department s appeal on the said issue and held that the retention money should not be included in computing book profits under Section 115JB as well as normal provisions. We are informed that the revenue has preferred appeal only with regard to the finding concerning computation of books of account under Section 115JB and not under the normal provisions and the finding to the said effect has attained finality. Mr. Debasish Chowdhury, learned counsel for the revenue submitted that the decision in Simplex Concrete Piles (India) Pvt. Ltd. was rendered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fication of satisfactory execution of the contract. The above decision would apply with full force to the case on hand. That apart the CIT(A) as well as the tribunal have examined the sample contract produced by the assessee which they have entered into with the third party customers/parties and found on facts that the assessee would be entitled to the amount retained only upon satisfactory completion of the work which would be certified by the contracting parties. Thus, we find that the tribunal rightly rejected the appeal filed by the revenue on the said aspect. Hence, the present appeal on the said issue needs to be rejected. Accordingly, substantial question of law no.B is answered against the appellant/revenue. As prefaced earlie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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