Task Scheduling and Resource Allocation is an important phase in Project Management. Scheduling Problem in Software Projects is NP-complete and various algorithmic approaches have been studied to develop an optimal solution to generate a schedule, which will be cost effective, utilize resources effectively and meet the target deadline. This paper addresses the above problem in detail and reviews how Ant Colony Optimization (ACO) approach is being used for Resource Allocation and Task Scheduling. We attempt to propose a modified objective function to minimize cost, based on the rate card of employees in a company.