DCIT-Circle,-52, Kolkata, Kolkata V. Sri Joydeep Majumder, Kolkata

ITA 529/KOL/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4926 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 7 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-11-2013
• Appeal Filed By: Department
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 04-04-2012
• Court: TRIBUNAL
• Department Lawyers: P K CHAKRABORTY

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH A , KOLKATA [ () . . . . . . . . , ,, , , ! '# ! '# ! '# ! '# ] ]] ] [BEFORE HONBLE SRI R.S.SYAL, AM & HONBLE SRI G EORGE MATHAN, JM] % % % % /ITA NO.529/KOL/2012 &#' ()/ ASSESSMENT YEAR : 2007-08 ('+ / APPELLANT ) - # - ( -.'+ /RESPONDENT) D.C.I.T., CIRCLE-52, . . SHRI JOYDEEP MAJUMDER KOLKATA KOLKATA (PAN AEWPM 7393 E) '+ / 0 / FOR THE APPELLANT: SHRI P.K.CHAKRABORTY, SR.DR -.'+ / 0 / FOR THE RESPONDENT: NONE 1#2 / 3 /DATE OF HEARING : 12.11.2013 4( / 3 /DATE OF PRONOUNCEMENT : 12.11.2013 5 / ORDER PER SHRI GEORGE MATHAN, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF LD. C.I.T.(A)- XXXIII, KOLKATA IN APPEAL NO.320/CIT(A)-XXXIII/CIR- 52/KOL/09-10 DATED 27.01.2012 FOR ASSESSMENT YEAR 2007-08. 2. SHRI P.K.CHAKRABORTY, SR.DR REPRESENTED ON BEH ALF OF THE REVENUE AND NONE APPEARED ON BEHALF OF THE ASSESSEE. 3. IT WAS SUBMITTED BY THE LD. DR THAT IN THE COUR SE OF ASSESSMENT THE AO HAD NOTICED THAT THE ASSESSEE HAD REDUCED THE RECEIPT O N ACCOUNT OF SALE OF THE MATERIALS ON THE DEMOLITION OF THE BUILDINGS AT DIFFERENT PROJEC T SITES, FROM ADVANCE RECORDED BY THE ASSESSEE IN RESPECT OF THE SAID PROJECTS UNDER CONS TRUCTION. IT WAS THE SUBMISSION THAT THE AO HAD TREATED THE RECEIPT OF RS.19,75,860/- AS REVENUE RECEIPT AND TREATED IT AS INCOME FOR THE RELEVANT ASSESSMENT YEAR. IT WAS THE SUBMISSION THAT ON APPEAL THE LD. CIT(A) HAD HELD THAT THE ASSESSEE WAS FOLLOWING PRO JECT COMPLETION METHOD AND ITA NO.529/KOL/2012 SHRI JOYDEEP MAJUMDER VS D.C.I.T., CIRCLE-52 ,KOL A.YR.2007-08 2 CONSEQUENTLY UPHELD THE VIEW OF THE ASSESSEE THAT T HE RECEIPTS ON SALE OF THE SCRAP MATERIALS OBTAINED ON ACCOUNT OF THE DEMOLITION OF THE CONSTRUCTION IN RESPECT OF THE PROJECTS UNDER CONSTRUCTION WAS LIABLE TO BE REDUCE D FROM THE ADVANCES GIVEN IN RESPECT OF THE SAID PROJECTS AND WAS TREATED AS WOR K-IN-PROGRESS. IT WAS THE SUBMISSION THAT AS THE RECEIPT ON THE SALE OF MATERIALS OBTAIN ED ON DEMOLITION WAS A REVENUE RECEIPT THE SAME WAS LIABLE TO TAX IN THE YEAR OF S ALE AS RIGHTLY DONE BY THE AO. IT WAS THE SUBMISSION THAT ORDER OF THE LD. CIT(A) WAS LIA BLE TO BE REVERSED. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE ASSESSMENT ORDER AS ALSO ORDER OF THE LD. CIT(A). ADMITTEDLY THE ASSESS EE IS FOLLOWING PROJECT COMPLETION METHOD. THIS IS NOT DISPUTED. ONCE THE ASSESSEE IS FOLLOWING THE PROJECT COMPLETION METHOD OF ACCOUNTING THEN OBVIOUSLY ANY RECEIPT IN THE COURSE OF THAT PROJECT IS LIABLE TO BE TREATED AS INCOME OF THAT PROJECT AND ANY EXP ENDITURE ALSO ACCORDINGLY THE EXPENDITURE IS RELATED TO THAT PROJECT. THE NET OF THE INCOME EXPENDITURE WOULD BE LIABLE TO TAX ONLY ON THE COMPLETION OF THE PROJECT AND NOT BEFORE. JUST BECAUSE THERE ARE CERTAIN RECEIPTS IN THE COURSE OF THE COMPLETIO N IT WOULD NOT BECOME THE INCOME IN RESPECT OF THAT PROJECT UNTIL THE PROJECT IS COMPLE TED. IN THE CIRCUMSTANCES WE ARE OF THE VIEW THAT THE FINDINGS ARRIVED AT BY THE LD. CI T(A) AND HIS ACTION IN DELETING THE ADDITION AS MADE BY THE AO IS ON THE RIGHT FOOTING AND DOES NOT CALL FOR ANY INTERFERENCE. 5. IN THE RESULT THE APPEAL OF THE REVENUE STANDS D ISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 12.11.2013. SD/- SD/- [ . . , ] [ . ! '# , ] [R.S.SYAL] [ GEOR GE MATHAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER ( (( (3 3 3 3) )) ) DATE: 12.11.2013. R.G.(.P.S.) ITA NO.529/KOL/2012 SHRI JOYDEEP MAJUMDER VS D.C.I.T., CIRCLE-52 ,KOL A.YR.2007-08 3 5 / -&&6 76(8- COPY OF THE ORDER FORWARDED TO: 1. SHRI JOYDEEP MAJUMDER, 42/135, NEW BALLYGUNJE ROAD, KOLKATA-700040. 2 D.C.I.T., CIRCLE-52, KOLKATA 3 . CIT KOLKATA 4. CIT(A)- XXXIII, KOLKATA. 5. DR, KOLKATA BENCHES, KOLKATA .6 -&/ TRUE COPY, 5#1/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES