2015 (7) TMI 410

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....ng question of law for our consideration: "Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in allowing the appeal of the assessee by deleting the entire addition of Rs. 93.34 lac and dismissing the appeal of the revenue holding that the amount received was by virtue of an interim order of the Court and is not accrued to the assessee ?" 3. The respondent-assessee is in the business of civil construction. The respondent-assessee had some disputes with Bombay Municipal Corporation (B.M.C.) in respect of a contract awarded to her by the B.M.C. In view of the dispute, the B.M.C. terminated the contract and refused to make the payment to the respondent-assessee. This resulted in the respondent fi....

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....s submitted that the difference between the amount received and the bank guarantee furnished, is income which is accrued and received by the respondent-assessee and should be subjected to tax in Assessment Year 1998-99. 6. Mr.Toprani, learned counsel appearing for the respondent-assessee while placing reliance on the decision of Hindustan Housing (supra) and also places reliance on the decision of this Court in the case of C.I.T. v/s Saksaria Biswan Sugar Factory Pvt. Ltd., reported in 195 ITR 778, wherein following the Apex Court decision, this Court has observed as under : "4. In response to a query from the Bench, Shri Trivedi, learned counsel for the assessee, stated that, after prolonged litigation, the Central government came do....

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....amount in question only pursuant to an interim order made by the court which was subject to several conditions to make the right absolute. Therefore, the collection made by the assessee at an enhanced rate at that stage was an inchoate one as this extra amount did not accrue to the assessee until the finalisation of the dispute pending before the Court. In fact, this is also the view taken by the Supreme Court in CIT v/s Hindustan Housing & Land Development Trust Ltd. (1986) 58 CTR 179 : (1986) 161 ITR 524 (SC) . Accordingly, we are in agreement with the Tribunal and answer the first question in the affirmative and in favour of the asseessee." In view of the above, the issue is concluded in favour of the respondent-assessee. 7. ....