2025 (6) TMI 1686

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.... considering 15% of the advance receipt of Rs. 2,23,50,000/- as income without any basis. The entire amount received from Mr.Nandagopal Salem during the A.Y.2016-17 should be recognized as revenue since it constituted sale consideration and not merely an advance. 2. The CIT(A) erred in law and on facts by failing to appreciate that the assessee has not followed a consistent methodology for revenue recognition. In previous assessment years, similar advances were recognized as revenue, demonstrating an inconsistency in the accounting practices which should have warranted full addition of the disputed amount. 3. The CIT(A) erred in law and on facts by incorrectly interpreting the nature of the receipts from Mr.Nandagopal Sale....

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....nized as revenue in the assessment year under appeal, aligning with the principles of revenue recognition and matching. 8. Any other ground of appeal that may be urged at the time of hearing. 3. The learned DR has submitted that the Assessing Officer has noted from the tax audit report and on verification of Form 26QB that the total receipt of the company for the year under consideration is Rs. 10,71,70,184/-, whereas the assessee has declared the sales turnover in the P&L Account at Rs. 8,48,798/-. The Assessing Officer further noted that, the assessee has adopted an accounting policy of recognizing the revenue in respect of the amount received at the time of booking, whereas the assessee has not recognized the sale receipt of ....

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....under consideration. Ultimately, in the month of February, 2018, the buyer has opted for flat No.701 and a sale deed was executed for sale of the said flat and the turnover of the same was offered to tax for the A.Y 2018-19. The learned AR has further submitted that, the learned CIT (A) though treated the said differential amount as turnover of the assessee for the year under consideration, however, in the order passed u/s 154, the learned CIT (A) has directed the Assessing Officer to give necessary relief in the A.Y 2018-19 by ensuring the fact that the assessee has accepted the order of the learned CIT (A) and also paid the tax on the said income. Thus, the learned AR has submitted that, the addition made by the Assessing Officer of the e....

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....me. It is further notable that the appellant company has received the occupation certificate for the said project on 21.05.2014 relevant to the assessment year 2015-16 itself. Further, Mr. Nandagopal Salem has paid said consideration of Rs. 2,23,00,000/- on various dates as under: 1. 24.07.2015 Rs. 1,16,50,000/- 2. 12.10.2015 Rs. 60,00,000/- 3 10.02.2016 Rs. 47,00,000/- 4.3.6 Hence, it is an admitted fact that the said purchaser has paid entire cost of plot in 3 installments. Further, the actuated sale was executed by the appellant to the said buyer on 05.02.2018. Accordingly, it is clear that the said receipt was purely in the nature of a sale consideration and cannot be construed as a receipt of advance....