Addition not warranted for low profit due to application of revised AS 7

Assessing Officer has accepted the returned income of the assessee wherein the Revenue has been booked in accordance with the changed method of accounting i.e. AS- 7. Assessee consistently followed AS-7 for recognition of revenue which was changed w.e.f. 1.4.2006. This Court in Paras Buildtech India Pvt. Ltd. v. Commissioner of Income Tax (2016) 382 ITR 630 (Del) had noted that this method is a known and recognised method of accounting, and was approved as a proper one. The Court had also relied on CIT v. Bilahari Investment Pvt. Ltd. (2008) 299 ITR 1 (SC). Relevant Extract of the Judgment 2...