DEPUTY COMMISSIONER OF INCOME-TAX, PANVEL CIRCLE,, PANVEL vs. M/S. GOPI RESORTS PVT.LTD,, RAIGAD

ORDER

PER INTURI RAMA RAO, AM:

1. “On the facts and circumstances of the case, and in law, the Ld.CIT(A) erred in not appreciating the fact that there is disparity between the base and parameter considered for the revenue recognition and the construction cost to be claimed as expenditure in respect of the revenue recognized”

2. “On the facts and circumstances of the case, and in law, the Ld.CIT(A) erred in not appreciating the fact that the AO followed uniform criteria for the recognition of revenue as well as the cost of the construction in order to recognize the correct profit for the year under consideration." 3. The order of the CIT(A) may be vacated & that of the Assessing Officer may be restored 4. The appellant craves leave to add, amend, alter or delete any ground of appeal

.”

3. Briefly, the facts of the case are as under : The respondent-assessee is a company incorporated under the provisions of the Companies Act, 1956. It is engaged in the business of real estate development. The return of income for the assessment year 2012-13 was filed on 26.09.2012 declaring total income of Rs.2,88,16,804/-. Against the said return of income, the assessment was completed by the Assistant Commissioner of Income Tax-12(2)(2), Mumbai (‘the Assessing Officer’) vide order dated 30.03.2015 passed u/s 143(3) of the Income Tax Act, 1961 (‘the Act’) by disallowing the cost of construction as expenditure by treating, as part of the closing work-in-progress.

4. Being aggrieved by the assessment order, an appeal was filed before the ld. CIT(A), who vide impugned order allowed the claim of the respondent-assessee company by holding as under :-