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B. Section 43CB of the Act is not applicable to the Appellant and there is no specific ICDS applicable for real estate companies.

18. The Ld. AO has contended in para 4.4(iv), 4.4(v) and 4.4(vi) of the assessment order that provisions of section 43CB of the Act are applicable and the Appellant was obliged to compute taxable income under POCM in accordance with the ICDS notified under section 145(2) of the Act. In this regard, it is respectfully submitted that the said section has no application to the Appellant for the reasons elaborated hereunder:

It is submitted that section 43CB of the Act came into force w.e.f. AY 2017- 18 vide Finance Act, 2018. As per the provisions of section 43CB of the Act, the profits and gains arising from a construction contract or a contract for providing services shall be determined on the basis of percentage of completion method in accordance with the income computation and disclosure standard III notified under sub-section (2) of section 145 of the Act. Relevant extracts of section 43CB of the Act are reproduced as under:
(emphasis supplied)

27. In view of the above, the Appellant humbly submits that real estate business carried on by the Appellant is not akin to construction contract executed by a contractor. Accordingly, ICDS III not being applicable to real estate contracts, section 43CB of the Act is not attracted to the facts of the case of the Appellant.

28. Accordingly, since section 43CB of the Act is not applicable to the Appellant and there is no specific ICDS applicable for real estate companies, the Appellant was mandated, under section 145(1) of the Act, to follow the method of accounting prescribed under section 133 read with section 129 of the Companies Act, 2013.

7.5.3 As regards the AO's contention that section 43CB is applicable to the appellant and hence it was obliged to compute taxable income under POCM and not under CCM, it may be mentioned here that section 43CB came into force vide Finance Act, 2018 w.e.f. A.Y. 2017-18. The relevant extract of this section is reproduced below:-

"43CB. (1) The profits and gains arising from a construction contract or a contract for providing services shall be determined on the basis of percentage of completion method in accordance with the income computation and disclosure standards notified under sub-section (2) of section 145."