TaxTMI 
TaxTMI 
TaxTMI 
2013 (6) TMI 944
X X X X Extracts X X X X
X X X X Extracts X X X X
....nd the appeal was restored on file. Thereafter the appeal was fixed for hearing. 3. Shri J Sreekumar, the ld. representative for the assessee submitted that the first issue arises for consideration is computation of income of Rs. 11,02,395 by the assessing officer. According to the ld. representative, the assessee company engaged in the business of developing intellectual property in advanced personal communication and networking. The assessee filed the return of income for the year under consideration declaring a loss of Rs.10,20,622. However, the assessing officer computed the income at Rs.11,02,395. 4. Referring to the assessment order, the ld. representative submitted that for the year under consideration, the assessing officer found ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ct undertaken by the assessee was a unique one and there was no precedent in the past and it was first of its kind in the globe. The project was being monitored by the contractor M/s Neogen I & I Systems Pvt Ltd. During the financial year 2004-05, the research and development team of the company started the development of the software as per the model approved by the customer. Therefore, for the year 2001-02, 2002-03 and 2003-04 the outcome of the transaction could not be estimated and as such, the income could not be recognized. According to the ld. representative, the devising of a model of the finished product happened only at the end of the financial year 2003-04. Therefore, no income could be recognized during the year under considerat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r method for the year under consideration also. Therefore, according to the ld.DR, the lower authorities have rightly treated part of the project advance as income for the year under consideration. 7. We have considered rival submissions on either side and also perused the material available on record. The only objection of the assessee appears to be that during the year under consideration, the assessee devised a computer machine which was a model one subject to approval of the customer. The fact remains is that the so-called model developed by the assessee was on the basis of order placed by the customer after paying the advance amount. Therefore, the so-called modeling devised by the customer is on the orders placed by the customer afte....