M/s. Halcrow Group Ltd vs. DCIT

Parties Involved

Facts Summary

The assessee, M/s. Halcrow Group Ltd, a company incorporated in the United Kingdom, specializes in providing planning, design, and management services for infrastructure development worldwide. For the assessment year 2013-14, the assessee declared a loss of Rs. 4,84,24,389/-. The only project in progress during the year was the Kishanganga project in Jammu and Kashmir, India. The assessee recognized revenue of Rs. 4,02,45,697/- from M/s. NHPC Ltd and earned special income of Rs. 8,38,88,001/- as fee for technical services. The assessee retrospectively changed its method for identifying the stage of completion of contracts, leading to a reversal of revenue amounting to Rs. 5,58,51,260/- related to earlier years. This change resulted in an impact on profitability of Rs. 4,30,05,774/- for the year under consideration.…

Legal Issues

• 1. Addition of Rs. 4,30,05,774/- due to change in method of accounting for revenue recognition
• 2. Levy of interest u/s 234B and 234D of the Act
• 3. Initiation of penalty proceedings u/s 271(1)(c) of the Act

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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