ITAT allows recognition of Retention Money as revenue in year of receipt

DCIT Vs Enexio Power Cooling Solutions India Pvt. Ltd. (ITAT Chennai) It could be seen that the nature of assessee’s work is such that a part of the contract amount is retained by the customers and the same is released on satisfactory performance of the project. Therefore, the assessee, following consistent method of accounting, defer the same and recognizes these revenues on receipts basis. So far as the expenditure is concerned, the same is claimed on accrual basis. As rightly noted by Ld. CIT(A), this methodology has been approved by coordinate bench of Tribunal in assessee’s own case f...