confirming the
action of the AO in holding that revenue on percentage completion
basis should be recognized in respect of advance received from the
customers ... officer, on perusal of records, observed that
the assessee follows "percentage completion method" but recognises
only part of the sales as "revenue
Completion Contract
method is one of such methods. Under the Completed contract method, the revenue
is not recognized until the contract is completed. Under ... search were also made
by accepting project completion method. Both Project Completion method
and the Percentage Completion method are recognized methods for
assessment of correct
filed written submissions justifying his
claim in the light of the Percentage Completion Method of income
3
ITA No. 80/PUN/2016
M/s. Kolte ... belief that the assessee follows Project Completion Method and
not the Percentage Completion Method. This belief led him to the
conclusion that deduction
Appeals) has erred in rejecting application of percentage completion method adopted by the AO when this rejection means acceptance of loss return of the assessee ... account of profit computed by change in method of accounting to percentage completion method. In this case, at the end of FY relevant
Appellant has claimed to have recognized revenue and
cost following the percentage completion method on the basis of
proportion of cost contract costs incurred ... completion determined by the
assessee was not reliable as compared to correct status of completion
of the contract. In that case the physical completion will
building and providing better
amenities to the occupants/tenants and percentage completion
method is not applicable to such type of receipts."
2. Briefly stated ... proportion of work completed. Thus, in
present case 58% of work relating to project was completed and
appellant accounted 58% percentage of revenue receipts
Royal Palms (I) P.Ltd, Mumbai vs Dcit 13(3)(1), Mumbai on 22 September
meters. The assessee was asked to show cause as to why percentage completion
method should not be adopted in view of AS-7 issued ... completed contract method to deferred Revenue
expenditure and held that the completed contract method was not required to be
substituted by the percentage completion method
deduction on this ground.
The appellant stated that they are following percentage
completion method of accounting and whatever units are sold
they have offered profit ... deduction u/s 80 - IB (10) where the assessee
had followed percentage completion method and has further held
that Section 80-IB (10) does
during the year
the loss was recognized in view of the percentage completion method
followed by the assessee, as prescribed by the Accounting Standard ... assessee. It is not in dispute that the
assessee follows the percentage completion method. This is as per
the Accounting Standards specified by the ICAI
