2012 (1) TMI 86

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....sides the order dated 1st July, 2008 passed by the Commissioner of Income Tax (CIT, for short) under Section 263 of the Act. Having heard learned counsel for the parties, we frame the following substantial question of law: "Whether the Income Tax Appellate Tribunal was right in setting aside/quashing the order dated 1st July, 2008 passed by the Commissioner of Income Tax under Section 263 of the Income Tax Act, 1961?" 3. We have heard learned counsel for the parties and proceed with our decision. 4. Few facts may be noticed. The respondent-assessee had given bid for purchase of a commercial plot for construction of a shopping mall in Vasant Kunj, New Delhi to DDA on 15th December, 1993. The bid being the highest, the respondent-assess....

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..... Since the assessee has only one project in hand during the year, all the expenses that are claimed in P&L Account represents the cost that are attributable to contract activity and has to be allocated to the contract and not to be allowed as revenue expenditure during the year. Thus, AO‟s order allowing advertisement expenses are erroneous as AO has not enquired this aspect at all." 8. CIT had also specifically referred to Accounting Standard 7 and observed that the two modes are specified in the said Accounting Standard, namely, completion method and percentage method. CIT had recorded that the Assessing Officer had not dealt with and examined whether the respondent-assessee was following completion method or percentage completi....