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Turnover mismatches under percentage-completion accounting cannot alone establish suppressed income where customer advances remain recorded as liabili...
Turnover mismatches between service-tax and income-tax returns...
Turnover mismatches under percentage-completion accounting cannot alone establish suppressed income where customer advances remain recorded as liabilities.
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Turnover mismatches between service-tax and income-tax returns do not, by themselves, establish suppressed turnover where a real estate developer consistently recognises income under the percentage of completion method. Service tax may apply when customer advances are received, while income is recognised according to actual project completion. Audited books, tax-audit disclosures recording advances as liabilities, project-wise workings, and the absence of defects in the accounting method support the stated income recognition. On these facts, the alleged suppressed-turnover addition was deleted, and the consequential penalty for under-reporting of income did not survive.
Turnover mismatches between service-tax and income-tax returns do not, by themselves, establish suppressed turnover where a real estate developer consistently recognises income under the percentage of completion method. Service tax may apply when customer advances are received, while income is recognised according to actual project completion. Audited books, tax-audit disclosures recording advances as liabilities, project-wise workings, and the absence of defects in the accounting method support the stated income recognition. On these facts, the alleged suppressed-turnover addition was deleted, and the consequential penalty for under-reporting of income did not survive.
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