Itxa/4172/2010 Of The Commissioner Of Income Tax -6 Mumbai v. Irb Infrastructure Ltd

sas IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.4172 OF 2010 Commissioner of Income Tax-6, Mumbai ..Appellant. V/s. M/s. IRB Infrastructure Ltd. ..Respondent. Mr. Vimal Gupta with Ms. Padma Divakar for the appellant. Mr. F.V. Irani with P.C. Tripathi i/b. Atul K. Jasani for the respondent. CORAM : J.P. DEVADHAR AND K.K. TATED, JJ. K.K. TATED, JJ. DATED : 17TH OCTOBER, 2011 P.C. :- 1.Two questions of law raised in this appeal read thus :- (i)Whether on the facts and in the circumstances of the case, the Tribunal, in law, was correct to hold that the book profit arrived in earlier years by the assessing officer on giving effect to the assessee’s change in method of accounting policy in subsequent years, constitute substitution / modification / adjustment to the profit and loss account ?Tribunal, in law, was correct to hold that the book profit arrived in earlier years by the assessing officer on giving effect to the assessee’s change in method of accounting policy in subsequent years, constitute substitution / modification / adjustment to the profit and loss account ? (ii)Whether on the facts and in the circumstances of the case and in law the Tribunal is correct to treat the book profit arrived in earlier years by the assessing officer on giving effect to the assessee’s change in method of accounting policy in subsequent years, fall under the purview of Explanation 1 to Section 115JB of the I.T. Act, 1961 ?law the Tribunal is correct to treat the book profit arrived in earlier years by the assessing officer on giving effect to the assessee’s change in method of accounting policy in subsequent years, fall under the purview of Explanation 1 to Section 115JB of the I.T. Act, 1961 ? 2. The assessment year involved herein is AY 2005-06. 3.The ITAT in para 8 of its order has recorded a finding of fact that in the present case, the assessee has followed the approved method of accounting for the purpose of Companies Act and the same is not disputed by the revenue. Following the decision of the Apex Court in the case of Apollo Tyres Ltd. V/s. CIT reported in [2002] 255 ITR 273, the ITAT held that once the assessee has consistently followed the completed contract method for the purpose of computing its income in the books of account and the same were accepted under the company law, the assessing officer has no jurisdiction to modify the accounts maintained by the assessee. We see no infirmity in the aforesaid order passed by the ITAT. Accordingly, the appeal is dismissed with no order as to costs. (K.K. TATED, J.) (J.P. DEVADHAR, J.)