IN INCOME TAX APPELLATE TRIBUNAL H Bench, Mumbai Before Shri B.R. Baskaran (AM)& Shri Pawan Singh (JM) M.A. No. 251/Mum/2016 arising out of I.T.A. No. 7362/Mum/2011 (Assessment Year 2008-09) M.A. No. 252/Mum/2016 arising out of I.T.A. No. 788/Mum/2013 (Assessment Year 2009-10) M.A. No. 253/Mum/2016 arising out of I.T.A. No. 2999/Mum/2013 (Assessment Year 2010-11) M/s. Hindustan DCIT-14(2)(1) Construction Co. Ltd. Vs. Erstwhile 10(1) Hincon House Aayakar Bhavan LBS Marg M.K. Road Vikhroli East Mumbai-400 020. Mumbai-400 083. (Appellant) (Respondent) PAN No.AAACH0968B Assessee by Shri H.P. Mahajani Department by Shri Shiddaramappa Kappattanavar Date of Hearing 14.10.2016 Date of Pronouncement 14.10.2016 ORDER PER BENCH:- assessee has filed these miscellaneous applications against common order passed by Tribunal against cross appeals filed for AY 2008-09 to 2010-11. It has been pointed out that Tribunal has omitted to dispose of ground no.3 urged by assessee in all three appeals. 2. We heard parties and perused common order dated 06-04-2016 passed by Tribunal and notice that Tribunal has omitted to dispose of 2 Hindustan Construction Co. Ltd. ground No.3 (which is common in all three years) urged in all three appeals filed by assessee. said ground is related to allowability of loss arising from project executed by assessee and same is also linked with other grounds. 3. Accordingly Ground No.3 urged in all appeals filed by assessee is disposed of as under by inserting following paragraph in common order referred above:- 30. next issue urged in all three appeals filed by revenue relates to addition relating to loss claimed by assessee from BWSL project. assessee had estimated loss from project and accordingly claimed loss to tune of Rs.231.21 crores up to year ending 31.3.2007 on proportionate basis. assessee computed loss up to 31.3.2008 on basis of actual cost incurred and contract value, which worked out to Rs.252.07 crores. Accordingly assessee claimed loss of Rs.20.85 crores (Rs.252.07 less Rs.231.21 crores), being incremental value of loss. AO noticed that assessee had estimated total loss from BWSL project at Rs.185.60 crores, where as actual loss was shown at Rs.252.07 crores. AO also observed that in respect of another project named CBP project , actual loss and estimated loss was same. Accordingly, AO took view that assessee has adopted its own method for measuring loss in respect of BWSL project. Accordingly AO restricted loss to Rs.185.60 crores, being expected loss. Accordingly AO disallowed sum of Rs.66.46 lakhs, being difference between Rs.252.07 crores and Rs.185.60 crores, treating same as excess loss booked by assessee. Ld CIT(A) also confirmed same. 31. We heard parties on this issue and perused record. We notice that assessee has been estimating loss from project and accordingly booking loss on proportionate basis. During year under consideration, assessee has revised estimated loss at Rs.185.58 crores. However from accounts, it was noticed that loss incurred by assessee till 31.3.2008 worked out to Rs.252.07 crores on actual basis as against estimated loss of Rs.185.58 crores. In our considered view, when actual loss exceeds estimated loss, then it would be prudent to book entire amount of actual loss. On this principle, we are of view that assessee was justified in booking 3 Hindustan Construction Co. Ltd. incremental loss of Rs.20.85 crores. We notice that AO has disallowed difference between actual loss and expected loss. When books of accounts show actual loss, question of disallowance shall arise only when it is shown that actual loss shown by assessee was not correct. In absence of such finding, we are of view that tax authorities are not justified in disturbing actual loss of Rs.252.07 crores. Accordingly we set aside order passed by Ld CIT(A) on this issue in all three years under consideration and direct AO to allow loss by taking actual loss of Rs.252.07 crores. 4. In view of insertion of above said two paragraphs, paragraph no.30 in existing order shall be renumbered as no.32. 5. In result miscellaneous applications filed by assessee are allowed. Order has been pronounced in Court on 14.10.2016 Sd/- Sd/- (PAWAN SINGH) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated : 14/10/2016 Copy of Order forwarded to : 1. Appellant 2. Respondent 3. CIT(A) 4. CIT 5. DR, ITAT, Mumbai 6. Guard File. BY ORDER, //True Copy// (Dy./Asstt. Registrar) PS ITAT, Mumbai M/s. Hindustan Construction Co. Ltd. v. DCIT-14(2)(1), Mumbai