IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “B” BENCH: NEW DELHI BEFORE SHRI YOGESH KUMAR U.S, JUDICIAL MEMBER &

SHRI MANISH AGARWAL, ACCOUNTANT MEMBER [Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

[Assessment Year : 2018-19]

ORDER PER MANISH AGARWAL, AM :

The present appeal is filed by the assessee against the order dated 20.12.2024 by Ld. Commissioner of Income Tax (A), National Faceless Appeal Centre (“NFAC”), Delhi [“Ld. CIT(A)”] in Appeal No. NFAC/2017-18/10041203 assessed u/s 250 of the Income Tax Act, 1961 [“the Act”] arising out of the assessment order dated 19.04.2021 passed u/s 143(3) r.w.s. 144B of the Act pertaining to Assessment Year 2018-19.

2. Brief facts of the case are that assessee company is engaged in the business of construction of housing Estates, Apartments, shopping Centers, industrial building, offices, colonies, clubs, cinemas, development of lands etc. and filed its return of income on

30.10.2018, declaring total income of INR 5,92,243/-. The case was selected for complete scrutiny under CASS for the reason “income from Real Estate Business”. A notice u/s 143(2) was issued on 22.09.2019 followed by notices us/ 142(1) alongwith questionnaires from time to time. In response, assessee company filed replies y alongwith documents/evidences and after considering the same, the AO assessed the income of the assessee company at INR 2,36,30,393/- vide assessment order dated 19.04.2021 passed u/s

143(3) r.w.s. 144B of the Act.

3. Against the said order, assessee filed an appeal before Ld. CIT(A) who vide impugned order dated 20.12.2024, partly allowed the appeal of the assessee.

4. Aggrieved by the order of Ld. CIT(A), assessee is in appeal before the Tribunal by taking following grounds of appeal:-

1. “The Ld. CIT(A) has erred in law and against the facts &

circumstances of the case for confirming the addition of Rs.

21349415/-made in the assessment order dated 19/04/2021.

2. That the Ld. CIT (A) has erred in law against the facts and circumstances of the case for confirming the addition of Rs. 21349415/- by alleging that- In the instant case, it is seen that the appellant has given possession of the flats to prospective buyers. The clause 2 of the sample agreements submitted by the appellant during the appellate proceedings clearly states as under-.’2. That Vendor has already handed over the physical possession of above said apartment agreed to be transferred herein to the vendee." 6.2.3 The purchasers thus have received a right to enjoy the property. Hence, the Ld. AO has rightly held that there is transfer of property and thus the sale proceeds in the form of advances received are liable to be taxed without going to the facts of the case that where the full rights of the property sold are passed on to the buyers, the revenue is recognized to the financial statement as well as without considering the legal position as prescribed in accounting standards as well as decided by higher courts.

3. That the Ld. CIT (A) has erred in law for confirming the addition of Rs. 21349415/- without going through principles the accounting being adopted continuously by the assessee firm and this action of Ld. CIT(A) will not only effect the taxation of the year under consideration but also the taxability of subsequent years wherein the profitability on the sum of advances alleged have been recognized to its financial statements.

4. That the Ld. CIT (A) has erred in law for confirming the action of Ld.

AO for not following the procedure as prescribed in section 145 of the I.T. Act by alleging that it is notable that the Ld. AO in the para 4(f) of the Assessment Order has clearly mentioned that the assessee is not maintaining the stock records. The same is appearing in the Point no. 5 of Form 3CB