HERMES DEVELOPERS, MUMBAI V. ASST CIT 12(1), MUMBAI

ITA 144/MUM/2012

• Counselvise Citation: 14419914 RSA 2012
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-05-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2004-2005
• Appeal Filed On: 06-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GOLI SRINIVAS RAO
• Keywords: Reopening of assessment; Retrospective amendment
• Section: 143(3); 133A; 80IB

Judgement Text

ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 1 OF 15 IN THE INCOME TAX APPELLATE TRIBUNAL 'H' BENCH, MUMBAI BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI S.S.GODARA, JUDICIAL MEMBER ITA NOS.143 TO 146/MUM/2012 (ASSESSMENT YEARS: 2003-04 TO 2006-07) HERMES DEVELOPERS DHIRAJ CHAMBERS, 9 HAZARIMAL VS ASSTT. CIT 12(1) MUMBAI SOMANI MARG, FORT MUMBAI-01 PAN AAAFH 2179 K (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI JITENDRA SANGHAVI DEPARTMENT BY: SHRI GOLI SRINIVAS RAO, CIT DR DATE OF HEARING: 16/04/2012 DATE OF PRONOUNCEMENT: 04/05/2012 O R D E R PER B. RAMAKOTAIAH, A.M. THESE ARE APPEALS FILED BY ASSESSEE FOR ASSESSMENT YEARS 2003-04 TO 2006-07 INVOLVING THE DEDUCTION UNDER SE CTION 80IB(10) IN THESE ASSESSMENT YEARS. ASSESSEES CONTENTIONS A RE ON THE DISALLOWANCE OF DEDUCTION UNDER SECTION 80IB(10). I N ASSESSMENT YEARS 2003-04 AND 2004-05, THERE WERE FURTHER CONTE NTIONS WITH REFERENCE TO REOPENING OF THE ASSESSMENT UNDER SECT ION 147. 2. BRIEFLY STATED, ASSESSEE IS ENGAGED IN THE BUSINESS OF DEVELOPING AND BUILDING HOUSING PROJECTS. ASSESSEE CONSTRUCTED GROUP HOUSING SCHEME PROJECT NAMED HERMES HERITAGE ON A PLOT OF LAND ADMEASURING 1,15,621 SQ. METERS SET OUT AT SUR VEY NO.185-A YERWADA, PUNE. GROUP HOUSING PROJECT CONSISTED OF S EVERAL PROJECTS/BUILDINGS. ASSESSEE HAS CLAIMED DEDUCTION UNDER SECTION 80IB IN RESPECT OF PROJECTS CONSISTING OF BUILDING E-3, E-4, E-5 IN ASSESSMENT YEAR 2003-04, E-3, E-4, E-5 AND I IN ASS ESSMENT YEAR 2004-05 AND E-3, E-4, E-5, I & J IN ASSESSMENT YEAR S 2005-06 AND ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 2 OF 15 2006-07. ORIGINALLY ASSESSMENT FOR ASSESSMENT YEARS 2003-04 AND 2004-05 WERE COMPLETED UNDER SECTION 143(3) ALLOWIN G THE DEDUCTION UNDER SECTION 80IB(10). SURVEY OPERATIONS UNDER SECTION 133A WERE CONDUCTED ON 29-01-2009. DURING THE COURS E OF SURVEY IT WAS NOTICED THAT THE THREE PROJECTS E-3,E-4,E-5 WER E ON AN EARMARKED AREA OF 5,097.30 SQ. METERS. AO CONSIDERE D THAT AREA OF E-5 BUILDING WAS MARKED BY THE ARCHITECT AT 1697.31 SQ. METERS AND BY EXCLUDING THE ABOVE AREA OF E-3 AND E-4 BUILDING S COMES TO 3,399.99 SQ. METERS WHICH IS LESS THAN 1 ACRE PER P ROJECT/BUILDING. THUS THE DEDUCTION CLAIM UNDER SECTION 80IB(10) WAS DISALLOWED ON THE REASON THAT E-3 AND E-4 DOES NOT HAVE ONE ACRE PLOT AREA AND E-5 DOES NOT QUALIFY AS SOME OF THE APARTMENTS ARE HAVING MORE THAN 1500 SQ. FT AS MEASURED BY AO IN THE COURSE OF SURVEY. 3. THE ISSUE WAS ORIGINALLY DISCUSSED IN ASSESSMENT YE AR 2007- 08 WHICH WAS NOT SUBJECT MATTER OF PRESENT APPEAL, IN WHICH AO FOR THE DELETED REASONS MENTIONED THEREIN HELD THAT THE DEDUCTION CLAIMED WITH REFERENCE TO THREE BUILDINGS WAS NOT A VAILABLE FOR THE ABOVE REASONS. AS REGARDS BUILDING I, AO NOTICED TH AT PROJECT AREA EARMARKED FOR THE PROJECT WAS 5097 SQ. METERS BUT T HE ACTUAL MEASUREMENT CERTIFIED WAS ABOUT 2682.49 SQ. METERS AND THUS THE AREA OF THE PROJECT I IS BELOW 1 ACRE LIMIT. WITH R EFERENCE TO BUILDING J, AO MEASURED THE AREA AND CAME TO A CONCLUSION TH AT COMES TO ONLY 3591.5 SQ. METERS WHICH IS LESS THAN ONE ACRE AND THUS ALL THE PROJECTS HAVING BEEN CONSTRUCTED ON A PLOT OF ONE A CRE OR LESS ARE NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 80IB(10). WITH REFERENCE TO THE APARTMENT SIZES IN BLOCK E-5 AND I, IT WAS SPEC IFICALLY MENTIONED BY AO THAT ON MEASUREMENT THE BUILT UP AREA OF THE FLAT IS MORE THAN 1500 SQ. FT AND THEREFORE DISALLOWED DEDUCTION CLAIMED UNDER SECTION 80IB(10) ON THIS ISSUE AS WELL. THERE IS NO DISPUTE WITH REFERENCE TO THE FACT THAT APARTMENT SIZES ARE LESS THAN 1500 SQ. FT WITH REFERENCE TO PROJECTS IN E-3, E4 AND J. THE CI T (A) FOR THE REASONS STATED IN 2007-08 HOWEVER, UPHELD THAT THE PROJECT WAS ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 3 OF 15 CONSTRUCTED ON LESS THAN ONE ACRE AREA. HOWEVER, CO NSIDERING THE ISSUE ON SIZE OF APARTMENT, CIT(A) HAS GIVEN A FIND ING IN ASSESSMENT YEAR 2003-04 WITH REFERENCE TO THE APARTMENT SIZE A S UNDER: THE PRESENT APPEAL RELATES TO AY 2003-04, WHEREAS THE AMENDMENT IN THE STATUTE DEFINING BUILT UP AREA WAS BROUGHT ON STATUTE W.E.F. 1.4.2005. IN ACIT VS. SAR OJ KAPOOR 38 DTR 475 (IND), THE INDORE BENCH HELD THAT THE CONTENTION OF REVENUE THAT THE PROVISIONS OF SECTIO N 80IB(14)(A) ARE OF RETROSPECTIVE NATURE IS REJECTED . IN SHETH DEVELOPERS CASE, 33 SOT 277 (MUMBAI), THE ITA T HELD THAT PRIOR TO 1 ST APRIL, 2005, BALCONY WOULD NOT FORM PART OF THE BUILT-UP AREA. BUILT UP AREA MEANT WHAT IS UNDERSTOOD IN THE COMMON PARLANCE NAMELY CARPET ARE A AGGREGATED WITH THE AREA COVERED BY THE THICKNESS O F THE WALLS AND NO PART OF THE BALCONY WOULD BE INCLUDED THEREIN. IN AIR DEVELOPERS 123 TTJ 959 (NAGPUR), IT WAS HELD THAT THE INSERTION OF THE DEFINITION WOULD BE APPLICATION FROM 1 ST APRIL, 2005 ONWARDS. THAT WHERE THERE IS NO DEFINITION OF BUILT UP AREA UNDER THE I T ACT, THE DEFINITION OF THE SAME IN THE DEVELOPMENT CONTR OL REGULATION, 2000 FOR NAGPUR CITY WOULD BE APPLICABL E. IN APPEAL FOR AY 2007-08, IT WAS HELD THAT THE DECISIO NS IN SHETH DEVELOPERS AND AIR DEVELOPERS WERE INAPPLICAB LE SINCE THEY RELATE TO A.Y 2003-04 WHICH WAS BEFORE T HE AMENDMENT CAME INTO EFFECT. THE PRESENT APPEAL IS F OR A.Y 2003-04 AND HENCE THE BUILT UP AREA WOULD HAVE TO BE COMPUTED IN ACCORDANCE WITH THE DEFINITION OF BU ILT UP AREA CONTAINED IN THE DEVELOPMENT CONTROL REGULATIO NS OF THE AREA WHICH ARE APPLICABLE. HOWEVER, IN VIEW OF THE FINDING THAT THE APPELLANT HAS NOT FULFILLED THE CO NDITION OF CLAUSE (B) OF SECTION 80IB(10), THE APPELLANT WO ULD NOT BE ENTITLED TO DEDUCTION UNDER SECTION 80IB(10). THE REVENUE IS NOT IN APPEAL ON THIS ISSUE. THEREFO RE, AS FAR AS THE APARTMENT SIZE OF THE E-5 AND I ARE CONCERNED, THER E IS NO DISPUTE WITH REFERENCE TO THE BUILT UP AREA TO BE CONSIDERE D FOR DEDUCTION UNDER SECTION 80IB, AS THE AMENDED PROVISIONS ARE N OT APPLICABLE TO THE PROJECTS APPROVED EARLIER. 4. THE LEARNED COUNSEL, HOWEVER, REFERRED TO DETAILS O F VARIOUS PLANS ON RECORD TO SUBMIT THAT ASSESSEE HAS CONSTRU CTED THE PROJECT ON AN AREA OF 28 ACRES (OF APPROXIMATELY 1,25,600 S Q. METERS) AND SO AS FAR AS THE AREA OF 1 ACRE AS SPECIFIED UNDER SECTION 80IB (10) ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 4 OF 15 STANDS FULFILLED, FOLLOWING THE PRINCIPLES LAID DOW N BY THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. VANDANA PR OPERTIES. IT WAS SUBMITTED THAT SINCE THE ENTIRE PROJECT IS HAVI NG MORE THAN ONE ACRE, INDIVIDUAL CALCULATION OF APPURTENANT AREA AS WAS DONE BY AO DOES NOT ARISE. WITH REFERENCE TO THE DISPUTED MEA SUREMENTS OF CERTAIN FLATS IN BLOCK E-5 AND I ARE CONCERNED, IT WAS SUBMITTED THAT AS RIGHTLY POINTED OUT BY THE CIT (A), THE PROJECTS WERE APPROVED BEFORE 2005 AND AS CONSIDERED BY THE ITAT IN THE CA SE OF ASSTT CIT V SHETH DEVELOPERS (P) LTD (2009) 33 SOT 277 (MUMBAI ITAT), THE BUILT UP AREA CAN NOT INCLUDE BALCONY, TERRACE ETC. HE REFERRED TO THE MEASUREMENTS TAKEN BY AO PARTICULARLY OF BLOCK E-5 WHICH ACCORDING TO AO COMES TO 1559.1SQ.FT AND IF THE BAL CONY AREA AND WINDOW SILLS WERE EXCLUDED TO THE EXTENT OF 77.91 S Q. FT, THE AREA OF THE FLAT IS LESS THAN 1500 SQ.FT I.E. 1481.22 SQ. F T. HOWEVER, IT WAS THE CONTENTION THAT EVEN THIS WORKING BY SIMPLY EXC LUDING THE BALCONY AREA ALONE INDICATES THAT SIZE OF FLAT IS W ITHIN NORMS WHEREAS THE ACTUAL CARPET AREA/BUILT UP AREA ACCORD ING TO THE PLAN IS MUCH LESS. 5. THE LEARNED COUNSEL SUBMITTED EVEN BY SIMPLY EXCLUD ING THE BALCONY AREA INCLUDED IN THE MEASUREMENT TAKEN BY A O, THE FLAT SIZE BECOMES LESS THAN 1500 SFT. THEREFORE, THERE C ANNOT BE ANY DISPUTE IN THE BUILT UP AREA CONCEPT. SIMILARLY W ITH REFERENCE TO THE BUILDING I, AOS MEASUREMENT OF 1597 SFT AND ACCORD ING TO ASSESSEE, IT IS 1372 SFT. AO WORKING INCLUDED A TERRACE AREA OF 208 SFT, AND IF THIS IS REMOVED THE FLAT AREA COMES TO 1372SFT WHIC H IS LESSER THAN 1500 SFT PRESCRIBED. SO THE CONTENTION OF THE REVEN UE ON THE SIZE OF THE APARTMENT OF MORE THAN 1500 SFT IS NOT CORRECT. HOWEVER, IT WAS SUBMITTED THAT THE CIT (A) HAS GIVEN A FINDING THAT THE BALCONY AREA CANNOT BE CONSIDERED FOR THE BUILT UP AREA WHICH WA S NOT DISPUTED BY THE REVENUE EITHER BY WAY OF CROSS APPEAL OR CRO SS OBJECTION. ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 5 OF 15 6. APART FROM THE ISSUE ON MERITS OF SECTION 80IB CLAI M, THE LEARNED COUNSEL ALSO MADE SUBMISSIONS ON THE ISSUE OF REOPENING OF ASSESSMENTS. IT WAS SUBMITTED THAT THE ASSESSMENTS WERE ORIGINALLY COMPLETED UNDER SECTION 143(3) AFTER OBTAINING INFO RMATION AND HE REFERRED TO THE ORDERS OF AO. FURTHER HE ALSO PLACE D ON RECORD, THE OFFICE NOTE OF AO TO SUBMIT THAT THERE IS AN INQUIR Y AND THE ITI REPORT IN FEBRUARY 2006 OF VERIFICATION BEFORE ALLO WING THE DEDUCTION UNDER SECTION 80IB (10) AND THEREFORE, THE ACTION T AKEN IN SURVEY IN 2009 AND REOPENING OF THE ASSESSMENT YEARS 2003-04 AND 2004-05 AFTER FOUR YEARS FROM THE END OF RELEVANT AY IS NOT CORRECT, FURTHER REFERRING TO THE REASONS RECORDED BY AO FOR REOPENI NG THE ASSESSMENT IN 2004-05, THE SUBMISSIONS WAS THAT ASS ESSEE CLAIMED DEDUCTION FOR BLOCK I ALSO AND THERE WAS NO MENTION ABOUT BLOCK I IN THE REASONS RECORDED. IN VIEW OF THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. JET AIRWAY S 331 ITR 236, THE DISALLOWANCE ON BLOCK I COULD NOT HAVE BEEN CON SIDERED BY AO IN THE RE-ASSESSMENT. 7. THE LEARNED COUNSEL FURTHER SUBMITTED THAT NOT ONLY THE QUESTION OF REOPENING BUT ALSO ON MERITS OF ISSUE A SSESSEE SUCCEEDS ON ALL ISSUES AND RELIED ON VARIOUS CASE LAW ON REO PENING: I) CIT VS. KELVINATOR OF INDIA LTD 187 TAXMAN 312(SC)/ 320 ITR 561 II) CIT VS. EICHER LTD 163 TAXMAN 259 (DEL) III) CIT VS. RAJ KUMAR MAHAJAN, 18 TAXMANN.COM 79 (DEL.) IV) HCL CORPORATION LTD VS. ACIT 17 TAXMANN.COM 270 (DE L.) V) ATMA RAM PROPERTIES (P) LTD VS. DCIT 16 TAXMANN.COM 67 (DEL.) VI) LOK HOUSING & CONSTRUCTION LTD V. DCIT, WP NO.1634 OF 2011 (BOM.) (2011TIOL 725 HIGH COURT MUM-IT). ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 6 OF 15 VII) RRB CONSULTANTS AND ENGINEERS PVT. LTD VS. DCIT WP NO.7313 OF 2010 VIII) CIT VS. JET AIRWAYS (I) LTD 331 ITR 236 (BOM.) IX) SHRI BALWANT RAI WADHWA VS. INCOME TAX OFFICER (ITA NO.4806/DEL/10(ITAT) X) HARYANA ACRYLIC MFT. CO. V. CIT, 308 ITR 38 (DEL.) 8. IN RESPONSE, THE LEARNED DEPARTMENTAL REPRESENTATIV E SUBMITTED THAT ASSESSEE HAS SOLD THE APARTMENT SHOW ING THE SUPER BUILT UP AREA AND ON THE BASIS OF THE AGREEMENT PLA CED ON RECORD, WHAT AO HAS CONSIDERED AREA IS ACCORDING TO THE PHY SICAL MEASUREMENT AND ALSO ASSESSEES BROCHURE AND AGREEM ENTS. IT WAS FURTHER SUBMITTED THAT WITH REFERENCE TO THE PLOT A REA, THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IS IN FAVOUR OF AS SESSEE BUT ASSESSEES ARCHITECT HIMSELF EARMARKED THE PROJECT AREA OF LESS THAN ONE ACRE. THEREFORE, AO CONTENTIONS ARE TO BE UPHEL D. 9. WE HAVE CONSIDERED THE ISSUE. AS FAR AS THE CLAIM O F 80IB ON MERITS ARE CONCERNED, THERE IS NO DISPUTE WITH REFE RENCE TO THE FACT THAT THE ENTIRE AREA ON WHICH THE PROJECTS STAND IS MORE THAN ONE ACRE. AO HIMSELF ARRIVES AT THE TOTAL AREA OF 5097 SQ. METERS EVEN WITH REFERENCE TO BUILDING E-3, E-4 AND E-5 WHICH I S MORE THAN ONE ACRE. HOWEVER, AOS CONTENTION WAS THAT ONE HAS TO CONSIDER THE AREA ON WHICH BUILDING WAS STANDING + 10% OF THE GA RDEN AREA (AND FAR), THEN EACH OF THE BUILDING IS STANDING ON A PL OT AREA OF LESS THAN ONE ACRE. THIS CONTENTION OF AO CANNOT BE ACCE PTED IN VIEW OF THE FACT THAT THE ENTIRE PROJECT CONSISTING OF VARI OUS BUILDINGS WAS APPROVED BY THE MUNICIPAL CORPORATION ON A PLOT OF AREA TO AN EXTENT OF 28 ACRES. THERE IS NO DISPUTE WITH REFERE NCE TO THE FACT THAT OTHER CONDITIONS FOR ELIGIBILITY UNDER SECTION 80IB(10) WITH REFERENCE TO THE COMMENCEMENT OF THE PROJECT ETC., WERE SATISFIED. THE ONLY OBJECTION BY AO WITH REFERENCE TO INDIVIDU AL BUILDING/PROJECT IS THAT THE BUILDING STANDS ON ARE A OF LESS THAN ONE ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 7 OF 15 ACRE. THIS ISSUE WAS CONSIDERED BY THE HON'BLE BOMB AY HIGH COURT IN THE CASE OF CIT VS. VANDANA PROPERTIES IN ITA NO .3633 OF 2009 AND 4361 OF 2010 DATED 28.3.2012 WHEREIN THE OBJECT IONS WITH REFERENCE TO HOUSING PROJECT AND AREA WAS CONSI DERED AND HELD AS UNDER: 23. THE NEXT ARGUMENT OF THE REVENUE IS THAT TO AVA IL THE DEDUCTION UNDER SECTION 80IB (10), THE HOUSING PROJECT MUST BE ON THE SIZE OF A VACANT PLOT OF LAN D WHICH HAS MINIMUM AREA OF ONE ACRE. IN THE PRESENT CASE, THERE ARE FIVE BUILDINGS (A, B, C, D AND E) O N A PLOT ADMEASURING 2.36 ACRES, HENCE, THE PROPORTIONA TE AREA FOR EACH BUILDING WOULD BE LESS THAN ONE ACRE AND, THEREFORE, THE BENEFIT OF SECTION 80IB (10) CO ULD NOT BE GRANTED IN RESPECT OF THE HOUSING PROJECT CONSISTING E BUILDING. 24. AS RIGHTLY CONTENDED BY THE COUNSEL FOR THE ASSESSEE AND THE INTERVENERS, SECTION 80IB (10)(B) SPECIFIES THE SIZE OF THE PLOT OF LAND BUT NOT THE SIZE OF THE HOUSING PROJECT. THE SIZE OF THE PLOT OF LAND, AS PER SECTION 80IB (10) MUST HAVE MINIMUM AREA OF ONE ACRE. THE SECTION DOES NOT LAY DOWN THAT THE PLOT HAVING MINIMUM AREA OF ONE ACRE MUST BE A VACANT PLOT. 25. THE QUESTION, THEREFORE, TO BE CONSIDERED IS, WHETHER THE REVENUE IS JUSTIFIED IN READING THE EXPRESSION PLOT OF LAND IN SECTION 80IB(10)(B) AS VACANT PLOT OF LAND ? 26. THE OBJECT OF SECTION 80IB (10) IN GRANTING DEDUCTION EQUAL TO ONE HUNDRED PER CENT OF THE PROF ITS OF AN UNDERTAKING ARISING FROM DEVELOPING AND CONSTRUCTING A HOUSING PROJECT IS WITH A VIEW TO BO OST THE STOCK OF HOUSES FOR LOWER AND MIDDLE INCOME GROUPS SUBJECT TO FULFILLING THE SPECIFIED CONDITIO NS. THE FACT THAT THE MAXIMUM SIZE OF THE RESIDENTIAL UNIT IN A HOUSING PROJECT SITUATED WITHIN THE CITY OF MUMBAI AND DELHI IS RESTRICTED TO 1000 SQUARE FEET CLEARLY SHO WS THAT THE INTENTION OF THE LEGISLATURE IS TO MAKE AVAILABLE LARGE NUMBER OF MEDIUM SIZE RESIDENTIAL UNITS FOR THE BENEFIT OF THE COMMON MAN. HOWEVER, I N THE ABSENCE OF DEFINING THE EXPRESSION 'HOUSING PRO JECT' AND IN THE ABSENCE OF SPECIFYING THE SIZE OR THE ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 8 OF 15 NUMBER OF HOUSING PROJECTS REQUIRED TO BE CONSTRUCT ED ON A PLOT OF LAND HAVING MINIMUM AREA OF ONE ACRE, EVEN ONE HOUSING PROJECT CONTAINING MULTIPLE RESIDENTIAL UNITS OF A SIZE NOT EXCEEDING 1000 SQUA RE FEET CONSTRUCTED ON A PLOT OF LAND HAVING MINIMUM AREA OF ONE ACRE WOULD BE ELIGIBLE FOR SECTION 80IB (10) DEDUCTION. IF THE CONSTRUCTION OF SECTION 80IB (10) PUT FORTH BY THE REVENUE IS ACCEPTED, IT WOULD MEAN THA T IF ON A VACANT PLOT OF LAND, ONE HOUSING PROJECT FULFI LLING ALL CONDITIONS IS UNDERTAKEN, THEN DEDUCTION WOULD BE AVAILABLE TO THAT HOUSING PROJECT AND IF THEREAFTER SEVERAL OTHER HOUSING PROJECTS ARE UNDERTAKEN ON TH E VERY SAME PLOT OF LAND, THE DEDUCTION WOULD NOT BE AVAILABLE TO THOSE HOUSING PROJECTS AS THE PLOT CEA SES TO BE A VACANT PLOT AFTER THE CONSTRUCTION OF THE F IRST HOUSING PROJECT. SUCH A CONSTRUCTION IF ACCEPTED WO ULD DEFEAT THE OBJECT WITH WHICH SECTION 80IB (10) WAS ENACTED. 27. MOREOVER, PLAIN READING OF SECTION 80IB (10) DO ES NOT EVEN REMOTELY SUGGEST THAT THE PLOT OF LAND HAV ING MINIMUM AREA OF ONE ACRE MUST BE VACANT. THE SAID SECTION ALLOWS DEDUCTION TO A HOUSING PROJECT (SUBJ ECT TO FULFILLING ALL OTHER CONDITIONS) CONSTRUCTED ON A PLOT OF LAND HAVING MINIMUM AREA OF ONE ACRE AND IT IS IMMATERIAL AS TO WHETHER ANY OTHER HOUSING PROJECTS ARE EXISTING ON THE SAID PLOT OF LAND OR NOT. IN TH ESE CIRCUMSTANCES, CONSTRUING THE PROVISIONS OF SECTION 80IB (10) BY ADDING WORDS TO THE STATUTE IS WHOLLY UNWARRANTED AND SUCH A CONSTRUCTION WHICH DEFEATS THE OBJECT WITH WHICH THE SECTION WAS ENACTED MUST BE REJECTED. 28. APART FROM THE ABOVE, THE CENTRAL BOARD OF DIRE CT TAXES (CBDT) BY ITS LETTER DATED 4 TH MAY 2001 ADDRESSED TO THE MAHARASHTRA CHAMBER OF HOUSING INDUSTRY HAS STATED THUS: THE UNDERSIGNED IS DIRECTED TO REFER TO YOUR LETTER NO.MCHI:RSA:M:388/ 19799/3 DATED 1 ST JANUARY 2001 AND TO STATE THAT THE ADDITIONAL HOUSING PROJECT ON EXISTING HOUSING PROJECT SITE CAN QUALIFY AS INFRASTRUCTURE FACILITY UNDER SECTION 10(23G) AND 80IB (10) PROVIDED IT IS TAKEN UP BY A SEPARATE UNDERTAKING, HAVING ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 9 OF 15 SEPARATE BOOKS OF ACCOUNTS, SO AS TO ENSURE THAT CORRECT PROFITS CAN BE ASCERTAINED FOR THE PURPOSE OF SECTION 80IB AND ALSO TO IDENTIFY RECEIPTS AND REPAYMENTS OF LONG TERM FINANCES UNDER THE PROVISIONS OF SECTION 10(23G), SEPARATELY FINANCING ARRANGEMENTS AND ALSO, IF IT SEPARATELY FULFILLS ALL OTHER STATUTORY CONDITIONS LISTED IN SECTIONS 10(23G) AND 80(B(10). WITH REGARD TO YOUR QUERY REGARDING THE DEFINITION OF HOUSING PROJECT, IT IS CLARIFIED THAT ANY PROJECT WHICH HAS BEEN APPROVED BY A LOCAL AUTHORITY AS A HOUSING PROJECT SHOULD BE CONSIDERED ADEQUATE FOR THE PURPOSE OF SECTION 10(23G) AND 80IB (10). 29. FROM THE AFORESAID LETTER OF CBDT, IT IS CLEAR THAT FOR THE PURPOSES OF SECTION 80IB (10) IT IS NOT THE MANDATE OF THE SECTION THAT THE HOUSING PROJECT MUS T BE ON A VACANT PLOT OF LAND HAVING MINIMUM AREA OF ONE ACRE AND THAT WHERE A NEW HOUSING PROJECT IS CONSTRUCTED ON A PLOT OF LAND HAVING MINIMUM AREA O F ONE ACRE BUT WITH EXISTING HOUSING PROJECTS WOULD QUALIFY FOR SECTION 80IB (10) DEDUCTION. EVEN OTHER WISE, THE ARGUMENT OF THE REVENUE DOES NOT STAND TO REASO N BECAUSE, IN THE CITY OF MUMBAI WHERE THERE IS ACUTE SPACE CRUNCH, IT IS DIFFICULT TO FIND A VACANT PLOT HAVING MINIMUM AREA OF ONE ACRE AND EVEN IF FEW SUCH PLOTS ARE EXISTING IT CANNOT BE SAID THAT SECTION 80IB (1 0) DEDUCTION WAS INTENDED TO GIVE BENEFIT ONLY TO THE UNDERTAKINGS WHO CONSTRUCT HOUSING PROJECTS ON THOS E FEW PLOTS. THEREFORE, IT IS CLEAR THAT ON A PLOT OF LAND HAVING MINIMUM AREA OF ONE ACRE, THERE CAN BE ANY NUMBER OF HOUSING PROJECTS AND SO LONG AS THOSE HOUSING PROJECTS ARE APPROVED BY THE LOCAL AUTHORIT Y AND FULFILL THE CONDITIONS SET OUT UNDER SECTION 80 IB (10), THE DEDUCTION THERE UNDER CANNOT BE DENIED TO ALL THOSE HOUSING PROJECTS. SECTION 80IB (10) WHILE SPECIFYING THE SIZE OF THE PLOT OF LAND, DOES NOT S PECIFY THE SIZE OR THE NUMBER OF HOUSING PROJECTS THAT ARE REQUIRED TO BE UNDERTAKEN ON A PLOT HAVING MINIMUM AREA OF ONE ACRE. AS A RESULT, SIGNIFICANCE OF THE SIZE OF THE PLOT OF LAND IS LOST AND, THEREFORE, THE ASSESS EE ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 10 OF 15 SUBJECT TO FULFILLING OTHER CONDITIONS BECOMES ENTI TLED TO SECTION 80IB(10) DEDUCTION ON CONSTRUCTION OF A HOU SING PROJECT ON A PLOT HAVING AREA OF ONE ACRE, IRRESPEC TIVE OF THE FACT THAT THERE EXIST OTHER HOUSING PROJECTS OR NOT. IN THESE CIRCUMSTANCES, THE DECISION OF THE TRIBUNAL I N REJECTING THE CONTENTION OF THE REVENUE REGARDING T HE SIZE OF THE PLOT CANNOT BE FAULTED . 10. IN VIEW OF THE ABOVE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT AND ALSO ON THE FACT THAT THE ENTIRE AREA OF THE PLOT IS MORE THAN ONE ACRE ON WHICH VARIOUS BUILDINGS WERE CONST RUCTED, THE CONTENTION OF AO THAT EACH OF THE BUILDING SHOULD H AVE ONE ACRE, CANNOT BE ACCEPTED. THEREFORE, THE REASONING FOR WH ICH THE DEDUCTION UNDER SECTION 80IB WAS DENIED BEING NOT V ALID AND NOT BASED ON ANY FACTS, IT IS TO BE HELD THAT ASSESSEE IS ELIGIBLE FOR DEDUCTION UNDER SECTION 80IB(10). THE SAME CANNOT B E DENIED FOR THE REASONS STATED BY AO. 11. WITH REFERENCE TO THE OTHER OBJECTIONS THAT SOME OF THE FLATS IN BLOCK E-5 & I ARE HAVING MORE THAN 1500 SFT, THE FI NDINGS OF THE CIT (A) ARE NOT DISPUTED TO THE EXTENT OF FLAT E-5. SIM ILAR FACTS APPLY TO THE BUILDING I ALSO. IF ONE EXCLUDES THE BALCONY AR EA, THE BUILT UP AREA IS LESS THAN 1500 SFT. THE CIT (A) FINDING ON THIS ISSUE IS BASED ON THE COORDINATE BENCH DECISION IN THE CASE OF ASS TT. CIT VS. SHETH DEVELOPERS 33 SOT 277 AND AIR DEVELOPERS 123 TTJ 95 9. IN THE CASE OF SHETH DEVELOPERS (SUPRA) IT WAS HELD THAT: THE DEFINITION OF BUILT-UP AREA AS INTRODUCED BY TH E FINANCE (NO. 2) ACT, 2004, ITSELF STARTS WITH INNER MEASUR EMENT OF THE RESIDENTIAL UNIT TO START WITH. EVEN AS PER THE AS SESSING OFFICER, THE COMMON PARLANCE MEANING OF BUILT-UP AR EA IS THE AREA ENCLOSED WITHIN THE EXTERNAL WALLS OF A FLAT. THUS, WHETHER IT IS THE INNER MEASUREMENT OR THE OUTER MEASUREMEN T, ONE THING IS AMPLY CLEAR THAT IT SHOULD BE THE ACTUAL M EASUREMENT AND NOT ANY ESTIMATE. THERE WAS NO DISPUTE BETWEEN THE PARTIES WITH REGARD TO CARPET AREAS, FOR BOTH THE A SSESSEE AS WELL AS THE ASSESSING OFFICER HAD TAKEN THE SAME CA RPET AREAS WHILE STARTING THEIR RESPECTIVE WORK-OUTS. HOWEVER, THE ASSESSING OFFICER RELIED ON A RATIO HE WORKED OUT F ROM THE MAP ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 11 OF 15 ATTACHED WITH THE OCCUPANCY CERTIFICATE, FOR ARRIVI NG AT THE BUILT- UP AREA FROM THE CARPET AREA. EVEN BY THE ASSESSING OFFICERS OWN WORK-OUT SUCH RATIO DRASTICALLY VARIED. FOR AIS HWARIYA PROJECT, HE HAD TAKEN 1.08 TO 1.10; FOR NEPTUNE 1.1 8 TO 1.32, AND FOR JUPITER HE HAD TAKEN 1.10 TO 1.20. THUS, HE HAD NOT ADOPTED ANY STANDARD METHODOLOGY IN HIS WORK-OUTS. THIS TYPE OF GROSSING UP METHOD BASED ON CARPET AREA WOULD NO T GIVE THE CORRECT BUILT-UP AREA. FOR ARRIVING AT CORRECT BUIL T-UP AREA, ACTUAL MEASUREMENTS ALONE OUGHT TO HAVE BEEN CONSID ERED. THE ASSESSEE HAD GIVEN A MEASUREMENT-BASED WORK-OUT OF BUILT-UP AREA FOR THE SPECIMEN FLATS IN EACH OF THE PROJECTS , WHEREVER THERE WAS ANY CHANCE OF AREA EXCEEDING 1000 SQ. FT. PER UNIT. THE WORK-OUT GIVEN BY THE ASSESSEE WAS AGGREGATING THE CARPET AREA WITH THE AREA OF THE WALL THICKNESS WHI CH WAS AVAILABLE FOR EVERY CASE WHERE THE CARPET AREA OF A UNIT FLAT EXCEEDED 80 SQ. METERS, WHICH IS EQUIVALENT TO 861. 12 SQ. FT. THE STAND OF THE ASSESSEE THAT THERE WAS NO CHANCE OF THE BALCONY AREA EXCEEDING 25 PER CENT OF THE CARPET AR EA AND, HENCE, WORK-OUTS WHICH WERE RELEVANT WERE ALL GIVEN BY IT, WAS SEEN TO BE CORRECT AND ACCEPTED BY THE COMMISSIONER (APPEALS). [PARA 17] THE DEFINITION OF BUILT-UP AREA SAYS BUILT-UP ARE A INCLUDE PROJECTIONS AND BALCONIES. THE ACCEPTED RULES OF IN TERPRETATION FOR AN INCLUSIVE DEFINITION AS ELUCIDATED BY THE AP EX COURT IN THE CASE OF CIT V. TAJ MAHAL HOTEL AIR 1972 SC 168 IS THAT IF THE WORD INCLUDE IS USED IN AN INTERPRETATION CLA USE, IT MUST BE CONSTRUED AS COMPREHENDING NOT ONLY SUCH THINGS AS IT SIGNIFIES ACCORDING TO THEIR NATURE AND IMPORT, BUT ALSO THINGS WHICH THE INTERPRETATION CLAUSE DECLARES THAT THEY SHALL INCLUDE. SO, NORMAL MEANING OF BUILT-UP AREA, BUT FOR THE DE FINITION INCLUDING PROJECTIONS AND BALCONIES, WOULD DEFINITE LY EXCLUDE THE LATTER. EVEN ACCORDING TO THE ASSESSING OFFICER HIMSELF, BUILT-UP AREA AS NORMALLY UNDERSTOOD IN COMMON PARL ANCE MEANS AREA ENCLOSED WITHIN THE EXTERNAL LINES OF TH E EXTERNAL WALLS. THEREFORE, THERE CAN BE NO DOUBT THAT PRIOR TO THE INTRODUCTION OF THE DEFINITION CLAUSE, AFORESAID BU ILT-UP AREA WOULD NOT INCLUDE PROJECTIONS AND BALCONIES AS NORM ALLY UNDERSTOOD. THE QUESTION AS TO WHETHER THE DEFINITI ON CLAUSE, MENTIONED ABOVE CAN BE DEEMED AS RETROSPECTIVE, WAS TO BE ANSWERED AGAINST THE REVENUE. NUMBER ONE, THE ENACT MENT ITSELF CLEARLY SPECIFIES THAT CLAUSE WILL HAVE EFFE CT FROM 1-4- 2005. NUMBER TWO, IT IS NOT A PROCEDURAL SECTION BU T A DEFINITION SECTION, WHERE AN ENLARGED MEANING IS GI VEN TO THE TERM BUILT-UP AREA AND SUCH ENLARGED MEANING WOUL D NOT HAVE BEEN IN THE REALM OF UNDERSTANDING OF ANY PERSON PR IOR TO ITS INTRODUCTION AND THE ASSESSEE WOULD HAVE GONE AHEAD WITH ITS RESPECTIVE PROJECTS BASED ON A COMMON UNDERSTANDING OF THE ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 12 OF 15 TERM BUILT-UP AREA. THUS, THE ENLARGED MEANING, I F GIVEN A RETROSPECTIVE EFFECT, WILL DEFINITELY AFFECT THE VE STED RIGHTS OF AN ASSESSEE. THEREFORE, THE DEFINITION HAD ONLY PROSPE CTIVE EFFECT FROM 1-4-2005. EVEN OTHERWISE, THE REVENUE WAS PREC LUDED FROM TAKING THE PLEA THAT SUCH DEFINITION WAS HAVIN G RETROSPECTIVE EFFECT FOR THE SIMPLE REASON THAT THE ASSESSING OFFICER HIMSELF HAD ACCEPTED IT TO BE ONLY PROSPECT IVE. THE CONTENTION OF THE REVENUE, THAT THERE COULD BE NO E STOPPELS AGAINST LAW EVEN IF THE ASSESSING OFFICER HIMSELF H AD TAKEN A DIFFERENT VIEW, BECAME IRRELEVANT ON THE FACE OF TH E FINDING THAT DEFINITION OF BUILT-UP AREA IS ONLY PROSPECTIVE W ITH EFFECT FROM 1-4-2005. THUS, PRIOR TO 1-4-2005, BALCONY WOULD NO T FORM PART OF THE BUILT-UP AREA, IRRESPECTIVE OF THE AREA OF S UCH BALCONY. [PARA 18] THE BMC RULES WERE CONCERNED WITH CALCULATION OF FS I AND IT WAS NOT IN ANY WAY MEANT THAT BUILT-AREA CAN INCLUD E BALCONY IN EXCESS OF 10 PER CENT OF THE CARPET AREA. THERE WAS CONSIDERABLE STRENGTH IN THE ARGUMENT OF THE ASSESS EE THAT ADOPTING A DEFINITION FORMULATED IN A REGULATION PR OMULGATED BASED ON A STATE LAW, THAT TOO RELEVANT ONLY FOR LI MITED LOCALIZED AREA, COULD NOT BE A BASIS FOR UNDERSTAND ING A COMMON TERM LIKE BUILT-UP AREA FOR THE PURPOSE OF THE ACT AND APPLICATION OF SECTION 80-IB THEREOF. WHEREVER THE INCOME-TAX ACT REQUIRED ADOPTION OF DEFINITION FROM ANOTHER EN ACTMENT, IT HAS CLEARLY SPECIFIED SO. CLAUSE (22AA) OF SECTION 2 DEFINES A DOCUMENT TO INCLUDE AN ELECTRONIC RECORD AS DEFINED IN THE INFORMATION TECHNOLOGY ACT, 2000. AGAIN IN CLAUSE ( 20) OF SECTION 2, DIRECTOR, MANAGER AND MANAGING AGENT HAV E BEEN GIVEN MEANINGS ASSIGNED TO THEM IN THE COMPANIES AC T, 1956. HOWEVER, THERE IS NO SUCH DEFINITION OF BUILT-UP AR EA, PRIOR TO THE AMENDMENT WHICH CAME INTO EFFECT FROM 1-4-2005, WHEREBY ITS MEANING WAS LINKED TO ANY OTHER ENACTMENTS. THE REFORE, IT WAS NOT POSSIBLE TO ACCEPT THE STAND OF THE REVENUE THAT THE ASSESSEE WAS OBLIGED TO WORK OUT THE BUILT-UP AREA BASED ON THE BMC RULES WHICH WERE PREDOMINANTLY INTENDED FOR CALCULATION AND UTILIZATION OF FSI. THUS, PRIOR TO THE INTRODUCTION OF CLAUSE ( A ) TO SECTION 80-IB(14), BUILT-UP AREA WOULD MEAN WHAT WAS UNDERSTOOD IN THE COMMON PARLANCE, WHICH W OULD ONLY BE CARPET AREA AGGREGATED WITH THE AREA COVERE D BY THE THICKNESS OF THE WALLS AND NO PART OF BALCONY COULD BE INCLUDED THEREIN. CHARACTER OF A BALCONY REMAINS AND WOULD N OT CHANGE WHETHER IT IS IN EXCESS OF 10 PER CENT OF THE CARPE T AREA OR OTHERWISE. [PARA 19] 12. SINCE ON FACTS, EVEN IF WE EXCLUDE THE BALCONY AREA FROM THE MEASUREMENTS TAKEN BY AO, EVEN WITHOUT CONSIDERING THE OTHER EXCLUSIONS AS CONSIDERED BY ASSESSEE, THE FLAT AREA IS LESS THAN 1500 ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 13 OF 15 SFT. IN VIEW OF THIS ON MERITS, ASSESSEE IS ELIGIBL E FOR DEDUCTION UNDER SECTION 80IB(10) AND WE ORDER ACCORDINGLY. 13. THE DEPARTMENTAL REPRESENTATIVES CONTENTION THAT T HE AGREEMENT INDICATES SUPER BUILT UP AREA OF MORE THA N 1500 SFT CANNOT BE ACCEPTED AS SUPER BUILT UP AREA INCLUDES COMMON AREAS, STAIR CASES AND ALSO BALCONY AREAS. CONCEPT OF SUP ER BUILT UP AREA IS UTILISED BY BUILDERS FOR COMMERCIAL PURPOSES FOR GETTING GOOD PRICE/ OR REPRESENTING LESS PRICE PER SQ.FT. THIS S UPER BUILT UP AREA CONCEPT CANNOT BE EQUATED WITH BUILT UP AREA AS P ER REGULATIONS WHICH REFERS ONLY TO CARPET AREA EXCLUDING BALCONY AND TERRACE ETC. THEREFORE, THE ARGUMENT OF THE REVENUE ON THIS CANN OT BE ACCEPTED. MOREOVER THE FINDING OF THE CIT (A) IN FAVOR OF ASS ESSEE IN ASSESSMENT YEAR 2003-04 AND 2004-05 ON THE SAME BLO CKS WAS NOT DISPUTED BY REVENUE. THEREFORE, ON THIS REASON ALSO , WE HOLD THAT THERE IS NO DISPUTE WITH REFERENCE TO THE AREA OF T HE FLAT BEING LESS THAN 1500 SFT IN BLOCK E-5 & I. SINCE THE ENTIRE PR OJECT IS STANDING ON MORE THAN ONE ACRE AREA AND THE APARTMENTS CONST RUCTED THEREIN THE PROJECT ARE WITHIN1500 SFT, ASSESSEE IS ELIGIBL E FOR DEDUCTION UNDER SECTION 80IB(10). ACCORDINGLY THE GROUNDS ON THIS ISSUE ARE ALLOWED. 14. WITH REFERENCE TO THE CONTENTION THAT THE ASSESSMEN TS IN AY 2003-04 AND 2004-05 WERE REOPENED BEYOND 4 YEARS WI THOUT ANY VALID REASONS, WE HAVE TO UPHOLD THE CONTENTIONS OF ASSESSEE. THE ASSESSMENT ORDER UNDER SECTION 143(3) IN ASSESSMENT YEAR 2003-04 DATED 29.3.2006 WAS COMPLETED AFTER ENQUIRY AND THE RE IS A FINDING IN PARA 3.1 OF THE ORDER THAT ASSESSEE FILED VARIOU S DETAILS AND COPIES OF VARIOUS CERTIFICATES AND APPROVED PLANS I N SUPPORT OF ITS CLAIM UNDER SECTION 80IB. THE SAME WAS EXAMINED AND FOUND TO BE IN ORDER. NOT ONLY THE ABOVE FINDING IN THE ASSESSM ENT ORDER, AO (ADDITIONAL COMMISSIONER OF INCOME TAX RANGE(12)-1, MUMBAI GIVES A NOTE IN THE FILE AS UNDER: ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 14 OF 15 3. THERE IS NO DIFFERENCE IN THE SALE PRICE PER SQ .FT BETWEEN 80IB AND NON-80IB PROJECT. COST OF CONSTRUC TION SHOWN IN 80IB AND NON-80IB PROJECT IS WITHIN NORMS. 4. THE CCIT AND CIT WERE APPRAISED ON ASSESSEES CA SE VIS--VIS THE RATIO OF ITAT SPECIAL BENCH IN WALL S TREET CONSTRUCTION LTD AND THE 80IB DEDUCTION CLAIMED BY THE ASSESSEE. 5. INSPECTOR REPORT OF THE 80IB PROJECT SHOWS THAT THE ACTUAL PROJECT HAS IN NO WAY DEVIATED FROM THE APPR OVED PLAN AND COMPLIES WITH ALL THE CONDITIONS LAID DOWN IN S.80IB. IT HAS ALSO BEEN OBSERVED THAT THERE IS NO JOINING OF ADJACENT FLATS TO VIOLATE THE AREA LIMIT OF 1500 SFT PER FLAT. NEITHER ANY PART OF THE BUILDING HAS BEEN USE D FOR COMMERCIAL PURPOSES. COMMENCEMENT CERTIFICATE & COMPLETION CERTIFICATE OF THE 80IB BUILDINGS ARE WI THIN THE TIME FRAME SPECIFIED UNDER SECTION 80IB. S.80IB PROJECT WAS ALSO SCRUTINIZED UNDER SECTION 143(3) I N THE PRECEDING A.Y 2002-03 15. THIS LEAVES US NO SCOPE THAN TO COME TO A CONCLUSIO N THAT REOPENING WAS BAD IN LAW AS THERE IS A FINDING THAT THERE IS NO JOINING OF ADJACENT FLATS VIOLATING THE AREA OF 150 0 SFT. THEREFORE, THE ENTIRE EXERCISE UNDERTAKEN BY AO SO AS TO DENY THE CLAIM IN THE REOPENED PROCEEDINGS CANNOT BE UPHELD AS AO EXAMINE D THESE ISSUES WHILE GRANTING THE DEDUCTION UNDER SECTION 8 0IB(10) ORIGINALLY. THERE IS NO MATERIAL TO COME TO REASONA BLE BELIEF FOR REOPENING ASSESSMENTS. THEREFORE, THE REOPENING DON E AFTER 4 YEARS WITHOUT HAVING ANY BASIS HAS TO BE HELD BAD IN LAW FOLLOWING THE PROPOSITIONS LAID DOWN BY THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. KELVINATOR INDIA LTD., 320 ITR 561, ASIAN P AINTS LTD VS. DCIT 308 ITR 195 (MUM). AS POINTED OUT THERE IS NO MENTION ABOUT THE DEDUCTION CLAIMED ON BUILDING-I IN THE REASONS RECORDED AND THEREFORE, FOLLOWING THE PRINCIPLES LAID DOWN IN TH E CASE OF JET AIRWAYS VS. CIT 331 ITR 236, THE ISSUE OF DEDUCTION ON BUILDING I COULD NOT HAVE BEEN CONSIDERED BY AO IN RE-ASSESSME NT PROCEEDINGS. MOREOVER IT WAS ALSO CONTENTION THAT T HERE IS NO REASON MENTIONED BY AO IN ARRIVING AT THE AREA OF THE FLAT AT 1597 SFT OF BUILDING I, AS NOTHING WAS COMMUNICATED TO ASSESSEE IN THIS REGARD. ITA NOS.143 TO 146 (4 APPEALS) HERMES DEVELOPERS MUMBAI H BENCH PAGE 15 OF 15 BE THAT AS IT MAY, SINCE ASSESSEE SUCCEEDS IN GETTI NG THE DEDUCTION UNDER SECTION 80IB(10) IN OTHER GROUNDS, THE REOPEN ING ISSUE BECOMES ACADEMIC IN NATURE. HOWEVER, WE PLACE IT ON RECORD THAT REOPENING ITSELF IS BAD IN LAW HAVING BEEN DONE AFT ER 4 YEARS FROM THE END OF RESPECTIVE ASSESSMENT YEAR AND THAT TOO AFTER COMPLETION OF THE ASSESSMENTS U/S 143(3). THERE IS NO FAILURE ON THE PART OF ASSESSEE IN FURNISHING THE NECESSARY DETAILS AT THE TIME OF ORIGINAL SCRUTINY PROCEEDINGS. THEREFORE, THE GROUNDS ON THI S ISSUE ARE ALSO CONSIDERED ALLOWED. AO IS DIRECTED TO GRANT THE DED UCTION AS CLAIMED BY ASSESSEE. 16. IN THE RESULT ASSESSEES APPEALS ARE ALLOWED ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH MAY, 2012. SD/- SD/- ( S.S. GODARA ) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED 4 TH MAY, 2012. VNODAN/SPS COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, H BENCH, ITAT, MUMBAI BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI