TaxTMI 
TaxTMI 
TaxTMI 
2019 (5) TMI 2039
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.... 'Act'). 2. Brief facts of the case are that the assessee firm consisting of three partners namely SV Inovabuild Pvt. Ltd., Sumer Infrastructure Pvt. Ltd. and Stresscrete India Pvt. Ltd., engaged in the business of civil construction filed its return of income for the assessment year under consideration declaring nil income. Since, the case was selected for scrutiny, the AO issued notice u/s 143 (2) and 142 (1) of the Act. In response thereof the authorized representative attended the proceedings from time to time and submitted the details called for. Since, it was noticed that the assessee had shown an amount of Rs. 3,17,00,000/- as mobilization advance received from Mira Bhayander Municipal Corporation (MBMC), the AO asked assessee to ....
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.... has challenged the impugned order passed by the Ld. CIT (A) on the following effective ground:- 1. "On the facts and in the circumstances of the case and in law, the ld. CIT (A) has erred in deleting the amount of Rs. 3,17,00,000/- as mobilization advance received from Mira Bhayander Municipal Corporation without appreciating the facts of the case. 2. On the facts and in the circumstances of the case and in law, the ld. CIT (A) erred in deleting the addition made on account of mobilization advance received by the assessee without appreciating the fact that the major part of the fund received in the form of mobilization advance has been siphoned into the partners capital account as repayment of loans received from them the....
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....on'ble Gujarat High Court in the case of CIT vs. Narayan singh Gulabsingh 63. Taxaann.com 335, the Hon'ble Karnataka High Court in the case of Pr. CIT vs. Elsamex-TWS-SNC Joint Venture ITA No. 248/2016 order dated 28th. Feb., 2016 and decision of the Delhi Bench of the ITAT in the case of DCIT vs. Five Star Construction Pvt. Ltd ITA No. 1861/Del/2011 to substantiate his contentions. 7. We have heard the rival submissions of the parties and also carefully gone through the entire material on record. The only grievance of the revenue is that the Ld. CIT (A) has wrongly deleted the addition made by the AO amounting to Rs. 3,17,00,000/- received by the assessee firm as mobilization advance from MBMC during the previous year. The Ld. CIT (A) h....
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....e accepted tender cost at the interest rate of S.B.I. interest rate + 0.5% extra per annum against the submission of Bank Guarantee amounting to mobilization advance amount. This submission of Bank Guarantee amounting to mobilization advance amount. This mobilization advances will be recovered in equal 4 installments from 1st to IVth R.A. bills of the contractor." From the above, it is clear that mobilization advance is recoverable, hence is cannot be income of the appellant. From the submission given by the assessee it is apparent that during the year under consideration bills was not raised by MBMC, hence no recovery has been made. As per statement of recovery of mobilization advance provided by the appellant Rs. 1,75,35,249/- of....
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....MBMC, therefore, no recovery was made. As per the relevant clause in the tender document regarding mobilization advance was given to the extent of 5% of the accepted tender cost at the rate of SBI interest plus 0.5% extra per annum against the submission of bank guarantee amounting to mobilization advance. This clause further contemplates that the mobilization advances will be recovered in four equal installments from 1st to 4th RA Bills of the Contractor. 9. In the case of CIT vs. Narayan singh Gulabsingh (supra) the Hon'ble Gujarat High Court has held that mobilization advance received cannot be treated as revenue receipt of the relevant year. In the case of DCIT vs. Five Star Constructions (supra) the Delhi Tribunal has held that mere....