Compensation Allowed as Revenue Expense Due to Business Expediency

Gopal Das Estates & Housing Pvt. Ltd. Vs CIT (Delhi High Court) The Delhi High Court dealt with multiple appeals under Section 260A of the Income-tax Act, 1961, involving common questions of law relating to a real estate developer engaged in construction and sale of commercial space. The assessee followed the Completed Contract Method (CCM) of accounting, under which revenue is recognized only upon completion or substantial completion of the project. The project in question was completed in Financial Year 1994–95. Issue 1: Nature of Compensation Paid to Flat Buyers The assessee had refun...