DCIT Vs DLF Limited (ITAT Delhi)
ITAT Delhi held that TDS provision under Section 194C of the Act are not attracted on EDC payments since EDC payments are not in nature of rent. Accordingly, disallowance of 30% of these payment u/s. 40(a)(ia) unwarranted. Accordingly, appeal of revenue dismissed.
Facts- The assessee company, engaged in the business of real estate, having multiple ongoing projects of construction and also selling upon the plots of land. The case of the assessee was selected for scrutiny assessment through CASS.
The said assessment was finalized upon making additions on various counts which was partly deleted by CIT(A) in appeal preferred by the assessee. Against the order of deletion of addition made by the CIT(A), the instant appeal has been preferred by the Revenue and assessee has come in appeal challenging the confirmation of addition made by CIT(A) on account of unverified purchased transactions. Hence, cross appeal is before us.
Conclusion- Held that out of the claim of Rs.5,77,409.11 lakhs in the year under consideration on account of change in the method of accounting, excess revenue as per the change method had been booked to the extent of Rs.444,160.95 lakhs in the A.Ys. 2017-18 to 202324. The observation made by Learned CIT(A) that the excess revenue of Rs.5,82,695.93 lakhs (Rs.5,77,409.11 lakhs + Rs.5,286.82 lakhs) recognized in the earlier years in respect of the projects which were under the implementation and yet to be completed needs to be reversed is therefore, found to be correct. Further that, deduction for adjustment of Rs.5,82,695.93 lakhs in the A.Y. 2017-18 should be allowed otherwise the same would amount to double taxation of income as the gross margins already booked would be again booked by the appellant in the future years is, therefore, acceptable. Thus, taking into consideration, the entire aspect of the matter, we do not find any reason to interfere with the order passed by the Learned CIT(A) in allowing the principal claim of Rs.5,82,695.93 lakhs to the appellant which is found to be just and proper so as not to warrant interference. Thus, this ground of appeal filed by revenue is dismissed.
