Computation of income from construction and service contracts - (New) Section 57 / (Old) Section 43CB

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....he profits and gains arising from • a construction contract or • a contract for providing services, • shall be determined on the basis of percentage of completion method as per the income computation and disclosure (i.e. ICDS - III) standards notified under section 276(2). Exception  • the profits and gains arising from a contra....

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....al gains. Contract Revenue as per ICDS - III Para 9 - Recognition based on "reasonable certainty of collection" • Contract revenue shall be recognised when there is reasonable certainty of its ultimate collection. Para 10 - Components of Contract Revenue Contract revenue shall comprise of: • (a) Initial Contract Price (including retentions) â....

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....osts shall comprise of : • (a) costs that relate directly to the specific contract; • (b) costs that are attributable to contract activity in general and can be allocated to the contract; • (c) such other costs as are specifically chargeable to the customer under the terms of the contract; and • (d) allocated borrowing costs i....

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....the contract are also included as part of the contract costs, provided • (a) they can be separately identified; and • (b) it is probable that the contract shall be obtained  • When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs when the contract is ....