TaxTMI 
TaxTMI 
TaxTMI 
2021 (8) TMI 122
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....he Id. AO amounting to Rs. 1,25,72,260/- on account of interest on loan paid without appreciating the submissions of the assessee. As such, the addition of Rs. 1,25,72,260/- may please be deleted. 2. That the Id. CIT(A) has erred in law and on facts, while not appreciating the fact that the Id. AO did not allow the interest on loan of Rs. 1,25,72,260/- as cost of project in the profit and loss account even after disallowing the same from the head Finance Cost considering the same as project cost. That the very reason of the Id. AO to disallow the same from finance cost head was for considering it as cost of project. That had the Id. AO allowed the consequent effect of his own actions, then there will be no change in profits of the assess....
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....purpose of revenue recognition, the appellant company followed Percentage Completion Method [PoCM], duly considering the provisions of Accounting Standards - 7 and 9. As a matter of general practice, the appellant company did not consider the cost of land for calculating the percentage of completion of project under consideration. 4. During the course of scrutiny assessment proceedings, the Assessing Officer observed that though the assessee is following PoCM, then it has to recognise its revenue as per PoCM method only, which is in line with the Guidance Note on Accounting for Real Estate Transactions. According to the Assessing Officer, the assessee cannot just follow some part of the Guidance Note as per its convenience. With these obse....
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....d. counsel for the assessee that by making addition, the Assessing Officer has made the assessee subject of double taxation of same income in different F.Ys. 9. The ld. counsel for the assessee pointed out that the assessee has considered the alleged profit in the subsequent A.Ys. The ld. counsel for the assessee drew our attention to the detailed chart of revenue recognition. It was further brought to our notice that the Assessing Officer, in F.Y. 2016-17 relevant to A.Y 2017-18, accepted the returned income under scrutiny assessment order framed u/s 143(3) of the Act. 10. Per contra, the ld. DR strongly supported the findings of the Assessing Officer. 11. We have given thoughtful consideration to the orders of the authorities below. It....
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....arding the year of allowability of expenditure. Considering that the assessee, was a company assessed at uniform rate of tax, the entire exercise of seeking to disturb the year of allowability of expenditure would, in any case, be revenue neutral." CIT vs Bilahari Investment (P.) Ltd. [2008] 299 ITR 1 (SC) "In the past, the department had accepted the completed contract method and because of such acceptance, the assessee had followed the same method of accounting, particularly in the context of chit discount. Every assessee is entitled to arrange its affairs and follow the method of accounting which the department has earlier accepted. It is only in those cases where the department records a finding that the method adopted by the asse....
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....est expenditure is part of borrowing cost which, in turn, is part of total project cost. The assessee was asked to furnish clarification as to why the interest expenses be not added to the project cost. 17. In its reply, the assessee stated that it has borrowed loan from sister concern for general purposes and paid interest to them. It was explained that since these expenses do not directly relate to the ongoing project of the assessee, the same has not been considered as cost of the project. 18. Since no details were provided by the assessee in support of its contention, the Assessing Officer disallowed the claim of Rs. 1,25,72,260/- 19. The assessee agitated the matter before the ld. CIT(A) but without any success. 20. Before us, the ....