ASST CIT 8(1), MUMBAI V. CORDCON BUILDERS P. LTD, MUMBAI

ITA 3162/MUM/2012

• Counselvise Citation: 316219914 RSA 2012
• Duration Of Justice: 3 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-05-2015
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 28-01-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 08-05-2012
• Court: TRIBUNAL
• Department Lawyers: PREMANAND J
• Assessee Lawyers: CHETAN A KARIA
• Keywords: Depreciation; Audit objection; Question of law; Tangible material; Difference of opinion; Reason to believe; Change of opinion; Reassessment proceedings
• Section: 143(3); 133A; 80IB; 147; 148; 10

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL G , BENCH MUMBAI , . . , BEFORE SHRI JOGINDER SINGH, JM & SHRI R.C.SHARMA, AM ./ ITA NO. 3162 / MUM /20 1 2 ( / ASSESSMENT YEAR : 200 6 - 20 0 7 ) ACIT - 8(1), MUMBAI VS. M/S CORDCON BUILDERS PVT. LTD., SAGAR CITY, V.P.CITY, OFF.S.V.ROAD, ANDHERI(W) , MUMBAI - 58 ./ ./ PAN/GIR NO. : A ABCC 5459 M ( / A PPELLANT ) .. ( / RESPONDENT ) /REVENUE BY : SHRI PREMANAND J. /ASSESSEE BY : SHRI CHETAN A KARIA / DATE OF HEARING : 20 TH APRIL , 201 5 / DATE OF PRONOUNCEMENT 15 TH MAY, 2015 / O R D E R PER R.C.SHARMA (A.M) : TH IS IS AN APPEAL FILED BY REVENUE AGAINST THE ORDER OF CIT(A) - 16, MUMBAI DATED 29 - 2 - 2012 , FOR THE ASSESSMENT YEAR 200 6 - 200 7 , IN THE MATTER OF ORDER PASSED UNDER SECTION 143(3) R.W.S147 OF THE I.T. ACT . 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. FACTS IN BRIEF IN THIS CASE ARE THAT ASSESSMENT U/S.143(3) WAS COMPLETED ON 29 - 12 - 2008, DETERMINING TOTAL INCOME AT RS.4,78,32,068/ - UNDER NORMAL PROVISIONS OF THE ACT. SUBSEQUENTLY, NOTICE U/S.148 DATED 31 - 3 - 2011 WAS I SSUED AND SERVED UPON THE ASSESSEE ON 31 - 3 - 2011. IN THE REASSESSMENT ITA NO. 3162 / 12 2 PROCEEDINGS, THE AO MADE AN ADDITION OF RS. 5,29, 49,927/ - BY DISALLOWING ASSESSEES CLAIM OF DEDUCTION U/S.80IB(10) VIDE ORDER DATED 20.12.2011. 3. IN APPEAL FILED BEFORE THE CIT(A), THE A SSESSEE CHALLENGED BOTH VALIDITY OF REOPENING U/S.147 AS WELL AS MERIT OF THE ADDITION SO MADE. BY THE IMPUGNED ORDER THE CIT(A) NOT ONLY QUASHED THE REASSESSMENT BUT ALSO DELETED THE ADDITIONS MADE BY THE AO DISALLOWING CLAIM U/S.80IB. THE PRECISE OBSERVA TION OF THE CIT(A ) WAS AS UNDER : - 2.3.1 I HAVE CAREFULLY CONSIDERED THE CONTENTION OF THE APPELLANT AND ALSO CAREFULLY GONE THROUGH THE DOCUMENTS AVAILABLE ON RECORD. I FIND THAT SECTION 147 PROVIDES THAT IF THE A O HAS REASON TO BELIEVE THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR ANY ASSESSMENT YEAR, HE MAY SUBJECT TO THE PROVISIONS OF SECTIONS 148 TO 163, ASSESS OR REASSESS SUCH INCOME AND ALSO ANY OTHER INCOME CHARGEABLE TO TAX, WHICH HAS ESCAPED ASSESSMENT AND WHICH COMES TO HIS NOTIC E SUBSEQUENTLY IN THE COURSE OF THE PROCEEDINGS UNDER THE SECTION. THE BASIC POSTULATE WHICH UNDERLINES SECTION 147 IS THE FORMATION OF THE BELIEF BY THE A O THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR ANY ASSESSMENT YEAR. THE A O MUST HAVE REASON TO BELIEVE THAT SUCH IS THE CASE BEFORE HE PROCEEDS TO ISSUE A NOTICE UNDER S. 147. THE REASONS WHICH ARE RECORDED BY THE A O FOR REOPENING AN ASSESSMENT ARE THE ONLY REASONS WHICH CAN BE CONSIDERED WHEN THE FORMATION OF THE BELIEF IS IMPUGNED. THE R ECORDING OF REASONS DISTINGUISHES AN OBJECTIVE FROM A SUBJECTIVE EXERCISE OF POWER. THE REQUIREMENT OF RECORDING REASONS IS A CHECK AGAINST ARBITRARY EXERCISE OF POWER. FOR IT IS ON THE BASIS OF THE REASONS RECORDED AND ON THOSE REASONS ALONE THAT THE VALI DITY OF THE ORDER REOPENING THE ASSESSMENT IS TO BE DECIDED. THE REASONS RECORDED WHILE REOPENING THE ASSESSMENT CANNOT BE ALLOWED TO GROW WITH AGE AND INGENUITY, BY DEVISING NEW GROUNDS IN REPLIES AND AFFIDAVITS NOT ENVISAGED. WHEN THE REASONS FOR REOPENI NG AN ASSESSMENT WERE RECORDED. THE PRINCIPLE OF LAW, THEREFORE, IS WELL SETTLED THAT THE QUESTION AS TO WHETHER THERE WAS REASON TO BELIEVE, WITHIN THE MEANING OF SECTION 147 THAT INCOME HAS ESCAPED ASSESSMENT, MUST BE DETERMINED WITH REFERENCE TO THE REA SONS RECORDED BY THE A O . THE REASONS WHICH ARE RECORDED CANNOT BE SUPPLEMENTED BY AFFIDAVITS. THE IMPOSITION OF THAT REQUIREMENT ENSURES AGAINST AN ARBITRARY EXERCISE OF POWERS UNDER SECTION 148. 2.3.2 IN CALCUTTA DISCOUNT CO. LTD. VS. IT O (1961) 41 ITR 191 (SC), THE SUPREME COURT HAS EXPATIATED THE EXPRESSION 'REASON TO BELIEVE' AS POSTULATING BELIEF AND THE EXISTENCE OF REASONS FOR THAT BELIEF. THE COURT PROCEEDED TO SAY THUS: 'THE BELIEF MUST BE HELD IN GOOD FAITH IT CANNOT BE MERELY A PRETENCE. IT CO NTEMPLATES EXISTENCE OF REASONS ON WHICH THE BELIEF IS FOUNDED, AND NOT MERELY A BELIEF IN THE ITA NO. 3162 / 12 3 EXISTENCE OF REASONS INDUCING THE BELIEF. THE COURT IS NOT CONCERNED WITH THE QUESTION WHETHER THE MATERIALS MAY BE REGARDED BY A COURT, BEFORE WHICH A DISPUTE I S RAISED, TO BE SUFFICIENT TO SUSTAIN THE BELIEF ENTERTAINED BY THE ITO.II ON A CHALLENGE BEING THROWN, IT IS NECESSARY FOR THE IT O TO ESTABLISH THAT THERE ARE MATERIALS FROM WHICH HE COULD FORM THE BELIEF THAT INCOME HAS ESCAPED ASSESSMENT OR HAS BEEN UND ER - ASSESSED. THEREFORE, THERE MUST BE MATERIAL FOR THE FORMATION OF THE BELIEF THAT INCOME HAS ESCAPED ASSESSMENT. THE IMPORTANCE OF THE AVAILABILITY OF MATERIALS FOR FORMULATION OF BELIEF HAS BEEN STRESSED IN SEVERAL DECISIONS, THE IMPORTANT AMONGST THEM BEING GIVEN BELOW: Y. RAJAN VS. IT O (1970) 77 ITR 839 (AP); N. SUNDARESWARAM VS. CIT (1972) 84 ITR 173 (KER); SITAR AM JINDAL VS. IT O (1972) 84 ITR 162 (CAL); UNION CARBIDE (INDIA) LTD. VS. IT O (1973) 87 ITR 529 (CAL); R. DALMIA VS. UNION O F INDIA (1972) 84 ITR 616 (DEL); SMT. HEMLATA AGARWAL VS. CIT (1967) 64 ITR 428 (ALL); SHARMA & CO. VS. IT O (1972) 86 ITR 741 (ALL); GRAHAMS TRADING CO. (INDIA) LTD. VS. IT O (1976) 105 ITR 1 (CAL). 2.3.3 THE JURISDICTIONAL HIGH COURT IN THE CASE OF N.D. BHATT, LAC & A NR . V S. LB.M. WORLD TRADE CORPORATION (1995) 216 ITR 811 (BORN) HAS HELD THUS: - IT IS ALSO WELL - SETTLED THAT THE REASONS FOR REOPENING ARE REQUIRED TO BE RECORDED BY THE ASSESSING AUTHORITY BEFORE ISSUING ANY NOTICE UNDER S. 148 BY VIRTUE OF THE PROVISIONS OF S. 148(2) AT THE RELEVANT TIME. ONLY THE REASONS SO RECORDED CAN BE LOOKED AT FOR SUSTAINING OR SETTING ASIDE A NOTICE ISSUED UNDER S. 148. IN THE CASE OF EQUITABLE INVESTMENT CO. (P) LTD. VS. ITO & ORS. (1988) 73 CTR (CAL) 236 : (1988) 174 ITR 714 (CAL), A DIVISION BENCH OF THE CALCUTTA HIGH COURT HAS HELD THAT WHERE A NOTICE ISSUED UNDER S. 148 OF THE IT ACT, 1961, AFTER OBTAINING THE SANCTION OF THE CIT IS CHALLENGED, THE ONLY DOCUMENT TO BE LOOKED INTO FOR DETERMINING THE VA LIDITY OF THE NOTICE IS THE REPORT ON THE BASIS OF WHICH THE SANCTION OF THE CIT HAS BEEN OBTAINED. THE IT DEPARTMENT CANNOT RELY ON ANY OTHER MATERIAL APART FROM THE REPORT. 2.3.4 THE SAME PRINCIPLE WAS REITERATED IN THE DECISION OF HINDUSTAN LEVER LTD. VS. R.B. WADKAR (2004) 268 ITR 332 (BORN) WHEREIN THE HON'BLE COURT HELD THUS: ' ... THE REASONS ARE REQUIRED TO BE READ AS THEY WERE RECORDED BY THE AO. NO SUBSTITUTION OR DELETION IS PERMISSIBLE. NO ADDITIONS CAN BE MADE TO THOSE REASONS. NO INFERENCE CAN BE ALLOWED TO BE DRAWN BASED ON REASONS NOT RECORDED. IT IS FOR THE AG TO DISCLOSE AND OPEN HIS MIND THROUGH REASONS RECORDED BY HIM. HE HAS TO SPEAK THROUGH HIS REASONS. THE REASONS RECORDED SHOULD BE CLEAR AND UNAMBIGUOUS AND SHOULD NOT SUFFER FROM A NY VAGUENESS. THE REASONS RECORDED MUST DISCLOSE HIS MIND. REASONS ARE THE MANIFESTATION OF MIND OF THE AG. THE REASONS RECORDED SHOULD BE SELF - EXPLANATORY AND SHOULD NOT KEEP THE ASSESSEE GUESSING FOR THE ITA NO. 3162 / 12 4 REASONS. REASONS PROVIDE LINK BETWEEN CONCLUSION A ND EVIDENCE. THE REASONS RECORDED MUST BE BASED ON EVIDENCE. THE AO, IN THE EVENT OF CHALLENGE TO THE REASONS MUST BE ABLE TO JUSTIFY THE SAME BASED ON MATERIAL AVAILABLE ON RECORD. THAT VITAL LINK IS THE SAFEGUARD AGAINST ARBITRARY REOPENING OF THE CONCLU DED ASSESSMENT. THE REASONS RECORDED BY THE AO CANNOT BE SUPPLEMENTED BY FILING AFFIDAVIT OF MAKING ORAL SUBMISSION, OTHERWISE, THE REASONS WHICH ARE LACKING IN MATERIAL PARTICULARS WOULD GET SUPPLEMENTED, BY THE TIME THE MATTER REACHES TO THE COURT, ON TH E STRENGTH OF AFFIDAVIT OR ORAL SUBMISSIONS ADVANCED. ' . 2.3.5 IN CIT VS. KELVINATOR OF INDIA LTD. (2010) 320 ITR 561(SC) , THE HON'BLE SUPREME COURT HAD HELD THAT PRIOR TO DIRECT TAX LAWS (AMENDMENT) ACT, 1987, REOPENING COULD BE DONE UNDER TWO CONDITI ONS AND FULFILLMENT OF THE SAID CONDITIONS ALONE CONFERRED JURISDICTION ON THE AO TO MAKE A BACK ASSESSMENT, BUT IN S. 147 (W.E.F. 1ST APRIL, 1989), THEY ARE GIVEN A GO BY AND ONLY ONE CONDITION HAS REMAINED, VIZ., THAT WHERE THE AO HAS REASON TO BELIEVE T HAT INCOME HAS ESCAPED ASSESSMENT, CONFERS JURISDICTION TO REOPEN THE ASSESSMENT. THEREFORE, POST 1ST APRIL, 1989, POWER TO REOPEN IS MUCH WIDER. HOWEVER, ONE NEEDS TO GIVE A SCHEMATIC INTERPRETATION TO THE WORDS 'REASON TO BELIEVE' FAILING WHICH, S. 147 WOULD GIVE ARBITRARY POWERS TO THE AO TO REOPEN ASSESSMENTS ON THE BASIS OF 'MERE CHANGE OF OPINION', WHICH CANNOT BE PER SE REASON TO REOPEN. THE CONCEPTUAL DIFFERENCE BETWEEN POWER TO REVIEW AND POWER TO REASSESS SHOULD ALSO TO BE KEPT IN MIND. THE AO HA S NO POWER TO REVIEW; HE HAS THE POWER TO REASSESS. BUT REASSESSMENT HAS TO BE BASED ON FULFILLMENT OF CERTAIN PRE-CONDITION AND IF THE CONCEPT OF 'CHANGE OF OPINION' IS REMOVED, AS CONTENDED ON BEHALF OF THE DEPARTMENT, THEN, IN THE GARB OF REOPENING THE ASSESSMENT, REVIEW WOULD TAKE PLACE. ONE MUST TREAT THE CONCEPT OF 'CHANGE OF OPINION' AS AN IN - BUILT TEST TO CHECK ABUSE OF POWER BY THE AO. HENCE, AFTER' 1ST APRIL, 1989, AO HAS POWER TO REOPEN, PROVIDED THERE IS 'TANGIBLE MATERIAL' TO COME TO THE CONCLU SION THAT THERE IS ESCAPEMENT OF INCOME FROM ASSESSMENT. REASONS MUST HAVE A LIVE LINK WITH THE FORMATION OF THE BELIEF. UNDER THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, PARLIAMENT NOT ONLY DELETED THE WORDS 'REASON TO BELIEVE' BUT ALSO INSERTED THE WORD ' OPINION' IN S. 147. HOWEVER, ON RECEIPT OF RE - PRESENTATIONS FROM THE COMPANIES AGAINST OMISSION OF THE WORDS 'REASON TO BELIEVE', PARLIAMENT RE - INTRODUCED THE SAID EXPRESSION AND DELETED THE WORD 'OPINION' ON THE GROUND THAT IT WOULD VEST ARBITRARY POWERS IN THE AO. 2.3.6 IT IS A SETTLED LAW THAT AO ACQUIRES JURISDICTION TO REOPEN ASSESSMENT UNDER S. 147(A) R/W S. 148 ONLY IF ON THE BASIS OF SPECIFIC, RELIABLE AND RELEVANT INFORMATION COMING TO HIS POSSESSION SUBSEQUENTLY, HE HAS REASONS WHICH HE MUST REC ORD, TO BELIEVE THAT BY REASON OF OMISSION OF FAILURE ON THE PART OF THE ASSESSEE TO MAKE A TRUE AND FULL DISCLOSURE OF ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT DURING THE CONCLUDED ASSESSMENT PROCEEDINGS, ANY PART OF HIS INCOME, PROFIT OR GAINS CHA RGEABLE TO INCOME - TAX HAS ESCAPED ASSESSMENT. HE MAY START REASSESSMENT PROCEEDINGS EITHER BECAUSE ITA NO. 3162 / 12 5 SOME FRESH FACTS COME TO LIGHT WHICH WERE NOT PREVIOUSLY DISCLOSED OR SOME INFORMATION WITH REGARD TO THE FACTS PREVIOUSLY DISCLOSED COMES INTO HIS POSSESSIO N WHICH TENDS TO EXPOSE THE UNTRUTHFULNESS OF THOSE FACTS. IN SUCH SITUATIONS, IT IS NOT A CASE OF MERE CHANGE OF OPINION OR THE DRAWING OF A DIFFERENT INFERENCE FROM THE SAME FACTS AS WERE EARLIER AVAILABLE BUT ACTING ON FRESH INFORMATION. HOWEVER, IN THE INSTANT CASE I FIND THAT LD. AO HAS NOT COME TO ANY CONCLUSION THAT THE INFORMATION PROVIDED BY THE APPELLANT IN THE ORIGINAL ASSESSMENT WERE NOT CORRECT. IN THE CASE OF TRANSWORLD INTERNATIONAL INC. VS. JT.CIT (2005) 273 ITR 242 (DEL), THE HON'BLE DELHI HIGH COURT HELD THAT WHEN SUFFICIENT MATERIAL WAS PLACED ON RECORD AND THE AO HAD ARRIVED AT CONCLUSION THAT THE ASSESSEE WAS ENTITLED TO A PARTICULAR RELIEF (DEPRECIATION IN THAT CASE) THEN ON THE SAME MATERIAL A DIFFERENT VIEW COULD NOT BE TAKEN HAVING F OUND THAT THE AMOUNT REPRESENTING PAYMENT TO CHIT - HOLDERS WAS IN FACT PAID TO A DIRECTOR OF THE ASSESSEE, A PRIVATE COMPANY CONTROLLED BY THE RECIPIENT, AND THAT THE SAID MONEY WAS AVAILABLE WITH THE ASSESSEE ITSELF AS UNDISCLOSED INCOME AND THUS, THE IM PUGNED ADDITION WAS JUSTIFIED, FINDING OF THE TRIBUNAL IS A FINDING OF FACT, AND THERE IS NO GROUND FOR INTERFERENCE; NO SUBSTANTIAL QUESTION OF LAW ARISES. 2.3.8 IN GODREJ AGROVET LTD. VS. DY. CIT & ANR. (2010) 230 CTR (BO M ) 65 (2010) 323 ITR 97 (BO M ), THE BOMBAY HIGH COURT HAS HELD THAT TRIBUNAL HAVING FOUND THAT NO NEW INFORMATION/ MATERIAL HAD COME TO THE NOTICE OF THE AO AFTER COMPLETION OF THE ORIGINAL ASSESSMENT TO FORM ANY BELIEF ABOUT ESCAPEMENT OF ASSESSEE'S INCOME AND THAT SUCH A PURPORTED BELI EF WAS ENTIRELY BASED ON REAPPRAISAL OR RECONSIDERATION OF THE MATERIAL/INFORMATION ALREADY AVAILABLE ON RECORD AT THE TIME OF COMPLETION OF THE ORIGINAL ASSESSMENT, IT WAS JUSTIFIED IN HOLDING THAT THE REOPENING OF THE ASSESSMENT WAS NOT VALID; NO SUBSTAN TIAL QUESTION OF LAW ARISES FOR CONSIDERATION. SIMILARLY IN THE CASE OF CIT VS. JAGSON INTERNATIONAL LTD. (2010) 321 ITR 544 (DEL), THE HON'BLE DELHI HIGH COURT HAS HELD THAT REASONS QUOTED FOR REOPENING ASSESSMENT, WERE PRACTICALLY THE SAME, AS THE REASON S FOR THE NOTICE UNDER S. 154, FOR RECTIFICATION OF THE ALLEGED MISTAKES IN THE REVISED ASSESSMENT ORDER - RECTIFICATION NOTICE HAD BEEN DROPPED BY THE SAME AO. HE CANNOT AGAIN START REASSESSMENT PROCEEDINGS ON THE BASIS OF THE SAME REASONS. WHERE THE CONDIT ION PRECEDENT FOR ISSUANCE OF A NOTICE IS ABSENT, THE NOTICE MIGHT BE CHALLENGED BY FILING A WRIT PETITION UNDER ART. 226 OF THE CONSTITUTION OF INDIA. REASSESSMENT NOTICE ISSUED BY AO LACKED JURISDICTION. 2.3.9 IN A RECENT DECISION IN THE CASE IF ROSE S ERVICED APARTMENTS (P) LTD VS. DCIT (2011) 56 DTR (DEL) 353 , THE HON'BLE DELHI HIGH COURT WHILE PLACING RELIANCE IN THE CASES OF JINDAL PHOTO FILMS LTD. VS. DCIT (1998) 234 ITR 170 (DEL), CIT VS. KELVINATOR OF INDIA LTD. (2010) 228 CTR (SC) 488 AND ACIT V S. RAJESH JHAVERI STOCK 2003 - 04, ASSESSEE FILED AN AUDIT REPORT IN FORM 10CCB IN WHICH RELEVANT PARTICULARS OF THE LICENSE TO WORK THAT WAS GRANTED TO THE UNIT OF ASSESSEE WAS DISCLOSED. THE LICENSE TO WORK DATED 14 - 8 - 2000, COPY OF WHICH WAS FILED BEFORE A O, CONTAINED A DISCLOSURE OF THE FACT THAT THE PLANS HAD BEEN APPROVED BY THE SARPANCH BY HIS LETTER DATED 12 - ITA NO. 3162 / 12 6 9 - 1988. THE BASIS ON WHICH THE ASSESSMENT FOR ASSESSMENT YEARS 2003 - 04 AND 2004 - 05 HAD BEEN SOUGHT TO BE REOPENED WAS THAT IT WAS DURING THE COURS E OF ASSESSMENT PROCEEDINGS FOR SUBSEQUENT YEARS THAT THE REVENUE HAD OBTAINED A COPY OF THE LICENSE WHICH SHOWED THAT THE PLANS HAD BEEN APPROVED AS FAR BACK AS ON 12 - 9 - 1988. THE BOMBAY HIGH COURT HELD THAT BASICALLY, THE VALIDITY OF THE EXERCISE OF THE P OWERS TO REOPEN AN ASSESSMENT HAS TO BE DECIDED WITH REFERENCE TO THE REASONS RECORDED WHILE REOPENING THE ASSESSMENT. THE REASONS RECORDED WHILE REOPENING THE ASSESSMENT DID NOT JUSTIFY THE EXERCISE OF THE POWER IN THE FACTS OF THIS CASE AS THERE WAS FULL AND TRUE DISCLOSURE. 2.3.11 IN THE CASE OF PURITY TECHTEXTILE, THE REASSESSMENT NOTICE APPEARED TO HAVE BEEN ISSUED PURSUANT TO AN AUDIT REPORT AND THE ASSESSING OFFICER HAD NO REASON TO BELIEVE THAT INCOME HAD ESCAPED ASSESSMENT. THE HON'BLE BOMBAY HIG H COURT WHILE DEALING WITH THE ISSUE OBSERVED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR ASSESSMENT YEAR 2003 - 04, THE ASSESSEE FILED AN AUDIT REPORT IN FORM 10CCB IN WHICH RELEVANT PARTICULARS OF THE LICENSE TO WORK THAT WAS GRANTED TO THE UNIT O F THE ASSESSEE WAS DISCLOSED. THE LICENSE TO WORK DATED 14 - 8 - 2000, COPY OF WHICH WAS FILED BEFORE THE AO, CONTAINS A DISCLOSURE OF THE FACT THAT THE PLANS HAVE BEEN APPROVED BY THE SARPANCH BY HIS LETTER DATED 12 - 9 - 1988. THE BASIS ON WHICH THE ASSESSMENT F OR ASSESSMENT YEARS 2003 - 04 AND 2004 - 05 HAS BEEN SOUGHT TO BE REOPENED IS THAT IT WAS DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR SUBSEQUENT YEARS THAT THE REVENUE HAD OBTAINED A COPY OF THE LICENSE WHICH SHOWED THAT THE PLANS HAVE BEEN APPROVED AS FAR BACK AS ON 12 - 9 - 1988. THIS STATEMENT WHICH IS CONTAINED IN THE REASONS, ON THE BASIS OF WHICH THE ASSESSMENT IS SOUGHT TO BE REOPENED, IS BELIED BY THE RECORD WHICH SHOWS THAT THE REVENUE WAS IN POSSESSION OF THE MATERIAL PRODUCED BY THE ASSESSEE DURING T HE COURSE OF THE ASS ESS MENT PROCEEDINGS FOR ASSESSMENT YEAR 2003 - 04 WHICH SHOWED THAT THE PLANS HAD BEEN APPROVED IN THE YEAR 1988. THE R EFORE, THE BASIS ON WHICH THE ASSESSMENT UNDER SECTION 143(3) HAS BEEN SOUGHT TO BE REOPENE D IS FACTUALLY INCORRECT. TH E AO GRANTED THE ASSESSEE A DEDUCTION UNDER SECTION 80 - IB AFTER BEING APPRAISED OF ALL THE RELEVANT DETAILS, INCLUDING THOSE IN FORM 10CCB WHICH SHOWED THAT PLANS HAD BEEN APPROVED IN 1988. THE A O HAS NOTED, WHILE SEEKING APPROVAL OF THE CIT, THAT DURING T HE COURSE OF REVENUE AUDIT PROCEEDINGS, AN AUDIT OBJECTION HAS BEEN RAISED ON THE GROUND THAT THE ASSESSEE WAS NOT ELIGIBLE TO A DEDUCTION UNDER SECTION 80 - IB FROM ASSESSMENT YEAR 2002 - 03. THE A O NOTES THAT THE AUDIT OBJECTION WAS NOT ACCEPTED BUT THAT AS A PRECAUTIONARY MEASURE THE ASSESSMENT WAS REOPENED UNDER SECTION 147. THERE IS MERIT IN THE SUBMISSION URGED ON THE PART OF THE ASSESSEE THAT THE A O HAD NO REASON TO BELIEVE THAT INCOME HAD ESCAPED ASSESSMENT. BASICALLY, THE VALIDITY OF THE EXERCISE OF TH E POWERS TO REOPEN AN ASSESSMENT HAS TO BE DECIDED WITH REFERENCE TO THE REASONS RECORDED WHILE REOPENING THE ASSESSMENT. THE REASONS RECORDED WHILE REOPENING THE ASSESSMENT DO NOT JUSTIFY THE EXERCISE OF THE POWER IN THE FACTS OF THIS CASE. ITA NO. 3162 / 12 7 2.3.12 IT TH US IS APPARENT THAT THE A O DID NOT HAVE BEFORE HIM ANY ADDITIONAL MATERIAL AT ALL TO FORM A BELIEF THAT INCOME HAD ESCAPED ASSESSMENT. THE APPELLANT HAD ADMITTEDLY PLACED ON RECORD BEFORE A O FOR ASSESSMENT YEAR 2006 - 07 THE ENTIRE DETAILS AND THE APPROVED P LAN OF ITS PROJECT BY THE BMC AND THE OTHER EVIDENCE WHICH UNEQUIVOCALLY SUPPORT THE APPELLANT'S CONTENTION THAT THE PROJECT GOT COMPLETED ON 26 - 03 - 2008 AND COMMENCED WELL AFTER OCTOBER 1998. THERE WAS, HENCE, A TOTAL ABSENCE OF 'TANGIBLE MATERIAL', TO JUS TIFY THE CONCLUSION THAT INCOME HAD ESCAPED ASSESSMENT FOR THE RELEVANT ASSESSMENT YEAR. THERE WAS NO MATERIAL BEFORE THE A O , THAT WOULD LEAD TO A FORMATION OF BELIEF THAT THE INCOME HAD ESCAPED ASSESSMENT. IN THE PRESENT CASE, AS WELL THE A O APPEARS TO HA VE RELIED EXCLUSIVELY ON AN AUDIT OBJECTION. THERE WAS, HENCE, A TOTAL ABSENCE OF 'TANGIBLE MATERIAL', TO JUSTIFY THE CONCLUSION THAT INCOME HAD ESCAPED ASSESSMENT. ALL THE CONDITIONS WERE FULFILLED BY THE APPELLANT FOR THE CLAIM OF THE DEDUCTION UNDER SEC TION 80IB(10) AND THE LD. AO VERIFIED THE SAME DURING THE ORIGINAL ASSESSMENT WHICH WAS COMPLETED AFTER CONDUCTING A SURVEY OPERATION U/S. 133A OF THE ACT. IN VIEW OF THE FOREGOING THE ISSUE OF NOTICE U/S. 148 IS BAD IN LAW AND THUS CANNOT BE SUSTAINED. TH IS GROUND OF APPEAL IS THUS ALLOWED. GROUND OF APPEAL NO. 2 1. ON THE FACTS AND IN THE CIRCUMSTANC ES OF THE CASE, THE LEARNED JT.CIT , ERRED IN DENYING THE CLAIM OF THE APPELLANT COMPANY U/S 80IB (1 0 ). 2. THE LEARNED J T. CIT FAILED TO APPRECIATE THAT THE APPELLANT'S CLAIM U/S 80IB ( 10 ) IS AS PER THE PROVISIONS OF LAW AND THAT THE SAME HAS BEEN CORRECTLY CLAIMED AND ALLOWED IN THE ORIGINAL ASSESSMENT. 3. UNDER THE ABOV E FACTS AND CIRCUMSTANCES, THE J T. CIT OUGHT NOT TO HAVE DENIED THE CLAIM OF THE A PPELLANT U/ S 80IB ( 10 ). 3.1 BRIEF FACTS OF THE CASE & AO 'S CONCLUSIONS 3.1.1 DURING THE REASSESSMENT PROCEEDINGS, THE LD. AO OBSERVED THAT AS CERTIFIED IN FORM NO.10CCB BY THE ACCOUNTANT, THE APPELLANT COMPANY WAS DEVELOPING PROJECT ON A PLOT, ADMEASU RING 40703 SQ.MTRS. DURING THE YEAR UNDER CONSIDERATION, TWO BUILDINGS NAMELY INDIAN OCEAN AND ATLANTIC SAGAR WERE COMPLETED AND THERE WAS CLOSING WORK IN PROGRESS OF RS.936.75 LAKHS IN RESPECT OF BUILDING UNDER CONSIDERATION. THE APPELLANT, HOWEVER, NEITH ER FURNISHED PROJECT APPROVAL NOR PROJECT COMPLETION CERTIFICATE. THE APPELLANT FURNISHED INTIMATION OF DISAPPROVAL, BUILDING COMMENCEMENT CERTIFICATE AND OCCUPATION CERTIFICATE OF THE BUILDING AND CLAIMED DEDUCTION U/ S.80IB(10) OF RS.5,29,49,927/ - . THE A PPELLANT SUBMITTED THAT THE DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS U/S. 143(3) VIDE LETTER DATED 18/3/2008 IT WAS INFORMED THAT IT WAS HAVING FOUR BUILDINGS PROJECT ON THE SAID PLOT OF LAND AND OUT OF THE SAME ONLY TWO BUILDINGS NAMELY INDIAN OCEAN AND ATLANTA SAGAR WERE COMPLETED. INITIALLY, THE APPELLANT INTENDED TO CLAIM DEDUCTION U/ S.80IB IN RESPECT OF ATLANTIC SAGAR BUILDING. HOWEVER, DURING SURVEY OPERATION IT WAS ITA NO. 3162 / 12 8 NOTICED THAT ATLANTIC SAGAR COMMENCED PRIOR TO 1998 AND AREA OF SOME FLAT S WAS MORE THAN 1000 S Q .FT. DUE TO THIS SURVEY, THE APPELLANT WITHDREW ITS CLAIM U/ S.80IB IN RESPECT OF ATLANTIC SAGAR. THE APPELLANT HAD CONSIDERED BOTH THE ABOVE BUILDINGS AS A PART OF SAME PROJECT. SINCE, THE APPELLANT VIOLATED THE BUILT UP AREA NORM A ND DEVELOPMENT & CONSTRUCTION COMMENCED PRIOR TO SEPTEMBER 1998, THE DEDUCTION U/ S. 80IB IS NOT ADMISSIBLE FOR THE ENTIRE PROJECT. THE APPELLANT FURTHER SUBMITTED THAT THE CA IN FORM NO.10CCB HAD CERTIFIED THAT SIZE OF THE PLOT ON WHICH THE SAID PROJECT W AS BEING DEVELOPED WAS 40803 SQ.MTRS. THUS, THE APPELLANT'S SUBSEQUENT CONTENTION THAT AREA MARKED FOR BUILDING INDIAN OCEAN AT 4981.96 SQ.MTRS. IS AFTER THOUGHT AND IS CONTRARY TO THE CERTIFICATE GIVEN IN FORM NO.10CCB. SINCE, ONE OF THE BUILDINGS IN THE PROJECT AS POINTED ABOVE VIOLATED THE CONDITIONS, DEDUCTION U/ S. 80IB(10) IS NOT CORRECT. 3.1.2. WITHOUT PREJUDICE TO THE ABOVE, THE LD.AO FURTHER OBSERVED THAT AS PER PROVISIONS OF SECTION 80IB(10) READ WITH RULE 158BBB, IN ORDER TO CLAIM DEDUCTION, TH E APPELLANT IS REQUIRED TO FURNISH SEPARATE AUDIT REPORT ALONG WITH PROFIT & LOSS ACCOUNT AND BALANCE SHEET AS IF THE UNDERTAKING OR ENTERPRISE WAS A DISTINCT ENTITY. HOWEVER, NO SUCH SEPARATE REPORT IS FURNISHED BY THE APPELLANT. FROM THE PLAN OF BUILDING INDIAN OCEAN, IT IS SEEN THAT OUT OF THE AREA OF 4981.96 ST.MTRS. AND AREA OF 183.27 SQ.MTRS. IS HILLOCK AREA .ON WHICH CONSTRUCTION IS NOT FEASIBLE. IF THIS UNFEASIBLE AREA IS EXCLUDED THE ACTUAL AREA FOR DEVELOPMENT WILL FALL BELOW 1 ACRE AND AS PER THE SAID SECTION THE AREA OF THE PLOT SHOULD BE MINIMUM OF 1 ACRE. THE LD.AO OBSERVED THAT AREA FOR DEVELOPMENT COMES AROUND 38% OF THE PLOT. THE APPELLANT FURTHER SUBMITTED THAT IT HAS ITSELF VIDE LETTER DATED 18/3/2008 HAS STATED THAT ON THE AFORESAID COMMO N PLOT, CERTAIN BASIC WORK SUCH AS ACCESS ROAD, DRAINAGE LINE, PERMANENT WATER LINE. BOUNDARY WALL, REMOVING OF SLUMS, SHIFTING OF MOSQUE, MOTHERSA, ETC. WOULD BE DONE LATER ON. FROM THIS IT IS CRYSTAL CLEAR THAT, EVEN THOUGH, THE BUILDING INDIAN OCEAN IS COMPLETE WITHOUT COMPLETION OF THE ABOVE WORK, IT CANNOT BE SAID THAT THE PROJECT AS A WHOLE IS A COMPLETE PROJECT.1 THE APPELLANT HAS CONTENTED THAT THE AREA EARMARKED FOR INDIAN OCEAN IS 4981.96 SQ.MTRS. FROM THE BUILDING PLAN OF INDIAN OCEAN, IT IS SEEN THE TOTAL BUILT UP AREA OF A & B WING WORKS OUT AS FOLLOWS: 'A' - WING = 4 FLATS = 665.56X4 = 2662.24SQ.FT. 'B' - WING = 4 FLATS 485.44 + 675.78 + 484.44 + 657.78 = 2320.44 SQ.FT. TOTAL = 4982.68 SQ.FT. ADD: SAY 30% FOR COMMON FACILITIES SUCH AS LIFT , PASSAGE, STAIRCASE, ETC. TOTAL = 1494.80 SQ.FT. AREA OCCUPIED BY THE BUILDING = 6477.48 SQ.FT. = 600 SQ.MTRS 3.1.3. THE LD.AO THUS CONCLUDED THAT THE ACTUAL AREA UTILIZED FOR CONSTRUCTION WORKS OUT TO 600.68 SQ.MTRS. I.E. 12% OF THE PLOT EARMARKED F OR DEVELOPMENT OF THE BUILDING INDIAN OCEAN. ITA NO. 3162 / 12 9 ACCORDINGLY, THE LD. AO REJECTED THE CLAIM OF THE APPELLANT OF DEDUCTION ULS. 80IB(10) AT RS.5,29,49,927/ - . 3.2 APPELLANT'S CONTENTIONS AND SUBMISSIONS: 3.2.1 DURING THE COURSE OF APPELLATE PROCEEDINGS THE APPELLANT SUBMITTED THAT THAT THE PROCEDURE TO BE FOLLOWED IN MUMBAI FOR CONSTRUCTION HAS NOT BEEN TAKEN INTO CONSIDERATION. AS PER THE PROCEDURE IN MUMBAI FOR ANY CONSTRUCTION ACTIVITY TO COMMENCE (WHICH PROCEDURE IS WELL DOCUMENTED) A BUILDER HAS TO UNDE RTAKE THE FOLLOWING STEPS FOR EXECUTION OF A CONSTRUCTION PROJECT, VIZ; A BUILDER HAS TO FIRST SUBMIT APPLICATION AND DESIGN PLANS AT THE BUILDING PROPOSAL OFFICE OF BMC AS PRESCRIBED BY SECTION 373 OF THE BMC ACT AND PAY SCRUTINY FEE (MUNICIPAL). THE FILE IS THEN FORWARDED TO THE CONCERNED OFFICER IN THE BUILDING PROPOSAL DEPARTMENT. THEN THE FILE IS FORWARDED TO THE SURVEY OFFICE, WHICH MAKE ITS REMARKS ON THE APPLICATION FILE AND CHECK THE REMARKS FROM THE DEVELOPMENT PLAN OFFICE (OBTAINED DURING THE DESIGN STAGE OF THE PROJECT). IF THE SURVEY OFFICE IS SATISFIED WITH ITS REVIEW, IT WILL SEND THE APPLICATION FILE BACK TO THE BUILDING PROPOSAL DEPARTMENT. A SUB - ENGINEER FROM THE BUILDING PROPOSAL OFFICE WILL CONDUCT A SITE INSPECTION WITHIN 3 T O 4 DAYS OF RECEIVING THE FILE FROM THE SURVEY OFFICE. THE DATE AND TIME OF THE SITE INSPECTION ARE ARRANGED BY THE COMPANY'S ARCHITECT. THE BUILDING COMPANY MUST BE ON - SITE WHEN THE INSPECTION TAKES PLACE. AFTER THE SITE INSPECTION, THE APPLICATION FI LE RETURNS TO THE BUILDING PROPOSAL OFFICE TO RECEIVE AN INTIMATION OF DISAPPROVAL (AUTHORIZATION) I.E. I.O.D ... THE INTIMATION OF DISAPPROVAL IS ISSUED WITH A LIST OF LINO - OBJECTION CERTIFICATES (NOCS) WHICH THE APPLICANT MUST OBTAIN SEPARATELY FROM VARI OUS DEPARTMENTS AND GOVERNMENT AUTHORITIES. FINAL CLEARANCE TO BUILD WILL ONLY BE GIVEN ONCE THE COMPANY OBTAINS ALL NOCS. ON SUBMISSION OF ALL REQUIRED NOCS MENTIONED IN THE LOD AND ON COMPLIANCE OF THE LOD CONDITIONS, THE APPLICANT MAY SUBMIT REQUEST FOR THE COMMENCEMENT CERTIFICATE (CC). CONSTRUCTION CAN COMMENCE ONLY IF THE INTIMATION OF DISAPPROVAL (LOD) CERTIFICATE AND COMMENCEMENT CERTIFICATE (CC) IS RECEIVED. THERE IS NO PROJECT APPROVAL CERTIFICATE THAT IS REQUIRED TO BE SEPARATELY ISSUED BY TH E BMC. THE LOD & CC IS THE PROJECT APPROVAL. (CERTIFICATE FROM ARCHITECT PAGE 118) ONCE THE BUILDING IS COMPLETE THE BUILDER HAS TO APPLY FOR AN O.C. I.E. OCCUPANCY CERTIFICATE WHICH SIGNIFIES THAT THE BUILDING IS COMPLETE AND CAN BE INHABITED. THE OCCUPAT ION CERTIFICATE GIVEN BY THE BMC WOULD BE SUFFICIENT PROOF THAT THE HOUSING PROJECT IS COMPLETED. EVEN IN DY. CIT VS. ANSAL PROPERTIES & INDUSTRIES LTD. (2008) 22 SOT 45 (DEL.) IT WAS CONSIDERED SUFFICIENT THE BOMBAY HIGH COURT IN BRAHMA ASSOCIATES V J CIT HAS HELD THAT SECTION 80 - IB(10) (PRE AMENDMENT W.E.F. AY 2005 - 06) DOES NOT DEFINE THE EXPRESSION 'HOUSING PROJECT' BUT REFERS TO HOUSING PROJECTS ITA NO. 3162 / 12 10 WHICH ARE APPROVED BY THE LOCAL AUTHORITIES. UNDER THE LOCAL LAWS, THE AUTHORITIES ARE EMPOWERED TO APPROV E PROJECTS AS 'HOUSING PROJECTS' WITH COMMERCIAL USER TO THE EXTENT PERMITTED UNDER THE DC RULES FRAMED BY THE RESPECTIVE LOCAL AUTHORITY. ACCORDINGLY, IF THE LEGISLATURE INTENDED TO RESTRICT THE BENEFIT OF DEDUCTION ONLY TO THE PROJECTS APPROVED EXCLUSIVE LY FOR RESIDENTIAL PURPOSES, THEN IT WOULD HAVE STATED SO. HOWEVER, AS THE LEGISLATURE HAS PROVIDED THAT THE DEDUCTION IS AVAILABLE TO ALL HOUSING PROJECTS APPROVED BY A LOCAL AUTHORITY, THE RESULT IS THAT EVEN PROJECTS WITH COMMERCIAL USER APPROVED AS A ' HOUSING PROJECT' ARE ELIGIBLE FOR DEDUCTION; WHILE THE SPECIAL BENCH WAS RIGHT IN HOLDING THAT A PROJECT WITH RESIDENTIAL AND COMMERCIAL USER TO THE EXTENT PERMITTED UNDER DC RULES WOULD BE A 'HOUSING PROJECT' AND ELIGIBLE FOR DEDUCTION, IT WAS NOT JUSTIFI ED IN CONFINING THE DEDUCTION ONLY TO PROJECTS HAVING COMMERCIAL AREA UPTO 10% OF THE BUA BECAUSE ONCE THE BASIC ARGUMENT OF THE REVENUE THAT THE HOUSING PROJECTS WITH COMMERCIAL USER ARE NOT ENTITLED TO SECTION 80IB(10) DEDUCTION IS REJECTED, NO RESTRICTI ON COULD BE IMPOSED. IF THE PROJECT IS APPROVED AS A 'HOUSING PROJECT' DEDUCTION U/S BO - IB(10) IS ALLOWABLE IRRESPECTIVE OF THE COMMERCIAL AREA. 3.2.2. THE APPELLANT FURTHER SUBMITTED THAT EACH BUILDING IS A SEPARATE PROJECT BY ITSELF. THE DEDUCTION UNDE R SECTION 80(IB) IS FOR A HOUSING PROJECT. ON A PIECE OF LAND A BUILDER CAN HAVE MULTIPLE PROJECTS SOME OF WHICH MAY BE ELIGIBLE FOR 80 (IB) DEDUCTIONS AND SOME MAY NOT BE. THE DEDUCTION IS QUA THE HOUSING PROJECT AND NOT THE ASSESSEE. EACH BUILDING WILL H AVE A SEPARATE PLAN APPROVAL AND COMMENCEMENT AND COMPLETION DATE. IF THE DEDUCTION IS TO BE ALLOWED CONSIDERING ALL THE BUILDINGS AS ONE PROJECT THE SECTION WOULD BE NOT BE WORKABLE. EACH BUILDING HAS A SEPARATE, DISTINCT AND INDEPENDENT IDENTITY ON ITS O WN. IT IS A PROJECT WHICH IS CAPABLE OF STANDING ON ITS OWN LEGS. THE APPELLANT FURTHER PLACED RELIANCE ON THE DECISION OF SAROJ SALES ORGANISATION AND THE ITAT, MUMBAI 'F' BENCH IN THE CASE OF VANDANA PROPERTIES APPEAL NO. ITA NO.1253/MUM/2007. THE APPELL ANT FURTHER SUBMITTED THAT IT HAS NOT CLAIMED DEDUCTION FOR ITS PROJECT ATLANTIC SAGAR AS ITS IOD AND COMMENCEMENT WAS PRIOR TO 1998. THIS PROJECT WAS SANCTIONED SEPARATELY AND HAS NO BEARING ON THE INDIAN OCEAN PROJECT FOR WHICH 80IB HAS BEEN CLAIMED. THE APPELLANT FURTHER SUBMITTED THAT THE OBSERVATION RAISED FOR DENYING DEDUCTION U/ S 80(IB)(10) IS TOTALLY ERRONEOUS AND ALSO NOT IN LINE WITH THE TRIBUNAL JUDGMENTS AND THE CLARIFICATION OF THE CBDT F. NO. 205/3/2001/ITA II WHERE IT HAS CLARIFIED THAT ANY PROJECT WHICH HAS BEEN APPROVED BY A LOCAL AUTHORITY AS A HOUSING PROJECT SHOULD BE CONSIDERED ADEQUATE FOR THE PURPOSES OF SECTION 80(IB)(10). THE APPELLANT FURTHER SUBMITTED THAT THE CA.' S CERTIFICATE MENTIONS THE ENTIRE PLOT AREA WHICH WAS PURCHASED BY THE ASSESEE COMPANY, HENCE THERE IS NO DISCREPANCY. 3.2.3. THE APPELLANT FURTHER SUBMITTED'. THAT RULE 18BBB REQUIRES SEPARATE REPORT [10CCB] FOR EACH 'UNDERTAKING OR ENTERPRISE'. THE APPELLANT FURTHER SUBMITTED THAT AUDIT REPORT FOR THIS PROJECT IN FOR M 10CCB AND HAVE ALSO GIVEN PROJECT WISE PROFIT AND LOSS ACCOUNT DURING THE ASSESSMENT. READING RULE 18BBB AND SECTION 80LB ITA NO. 3162 / 12 11 TOGETHER MEANS 'UNDERTAKING' AND 'HOUSING PROJECTS' MEAN TWO DIFFERENT THINGS. SOME OF THE ASSESEE'S HAVE A DIVISION WHICH CARRIES O UT SEVERAL HOUSING PROJECTS. IN SUCH PROJECTS DIFFICULTY ARISE AS TO PREPARING SEPARATE BALANCE SHEETS FOR EACH PROJECT AS THE RESOURCES ARE COMMON. THE COMPANY HAS GIVEN SEPARATE REPORT FOR INDIAN OCEAN A SEPARATE PROJECT. IT HAS ONLY ONE UNDERTAKING I.E. CORDCON BUILDERS WHICH DOES THE CONSTRUCTION FOR WHICH THE ACCOUNTS ARE PREPARED AND BALANCE SHEET FOR WHICH HAS BEEN SUBMITTED THE ENTIRE LAND AREA IS 40,803.10 SQ. MTR. (ABOUT 10 ACRE) OF WHICH 1873.27 SQ MTS WAS HILLOCK LAND. THE COMPARISON MADE IN BY THE A.O. WITH 4981.96 SQ MTS IS INCORRECT AND WRONG AS IT HAS TO BE COMPARED WITH THE TOTAL PILOT AREA WHICH COMPARISON IS ALSO OF NO SIGNIFICANCE TO THE CLAIM UNDER SECTION 80IB. THE APPELLANT FURTHER SUBMITTED THAT MAJOR PORTION OF THE HILLOCK AREA HAS B EEN LEVELED AND ONLY 716 SQ MTRS REMAIN WHICH IS A HILL AND STILL EXITS ON SITE. THE HILLOCK AREA WAS ALSO NOT IN ONE PLACE BUT SCATTERED ON THE ENTIRE PLOT OF LAND. THE CONTENTION RAISED IN THE ABOVE PARA IS BASED ON WRONG FACTS AND MISINTERPRETATION OF D ATA. PHYSICAL VERIFICATION WILL PROVE THE COMPANY'S STAND. THE FACTS HAVE BEEN MISINTERPRETED AND IT HAS BEEN SOUGHT TO LINK THE ENTIRE HILLOCK AREA TO THE AREA OF THE INDIAN OCEAN BUILDING. SINCE THE COMPARISON ITSELF IS WRONG THE OBSERVATIONS IN THIS PAR A HAVE NO BEARING ON THE CLAIM U / S 80IB. THE APPELLANT FURTHER SUBMITTED THAT THE ACT ONLY STATES THAT 'THE PROJECT IS ON THE SIZE OF A PLOT OF LAND WHICH HAS A MINIMUM AREA OF ONE ACRE'. IT DOES NOT TALK ABOUT UTILIZATION OF THE SAME. A BUILDER MAY DEVELO P ONLY 50% AND KEEP 50% VACANT. EVEN IN SUCH CASE DEDUCTION CANNOT BE DENIED. AS PER BMC RULES CERTAIN AREA HAS TO BE KEPT FOR RG., GARDEN ETC. THE PLOT SIZE HAS TO INCLUDE THE SAME. THE COMPANY HAS A LARGE PLOT OF LAND ON WHICH A NUMBER OF BUILDINGS WILL BE CONSTRUCTED. AS PER CBDT CLARIFICATION TO THE MAHARASHTRA CHAMBER OF HOUSING INDUSTRY EACH BUILDING IS A SEPARATE PROJECT. THE ASSESEE HAS GIVEN POSSESSION , PEOPLE HAVE COME TO STAY IN THE BUILDING, WATER CONNECTION, TELEPHONE AND ELECTRICITY CONNECTION HAS BEEN PROVIDED AND SOCIETY FORMED .THE FACT OF OCCUPATION AND COMPLETION HAS BEEN VERIFIED BY THE SURVEY TEAM. THE VERY FACT THAT THE BMC HAS GIVEN THE OCCUPATION CERTIFICATE IS PROOF OF COMPLETION OF THE PROJECT. THE SECTION ITSELF STATES THAT THE O. C . IS PROOF OF COMPLETION. 3.2.4 THE APPELLANT FURTHER SUBMITTED THAT THE UNDERSTANDING AND AREA CALCULATION APPEARS TO BE ERRONEOUS. THE RELEVANCE OF AREA OCCUPIED BY THE BUILDING HAS NOT BEEN UNDERSTOOD AND THE BASIS OF CALCULATION IS TOTALLY WRONG. TH E BMC PROVIDES FOR CONSTRUCTION BASED ON FSI I.E. FLOOR SPACE INDEX WHICH IS LINKED THE PLOT SIZE, AREA TO BE KEPT FOR R.G., BALCONY ETC. IN ORDER TO DETERMINE THE AREA ONE IS REQUIRED TO MULTIPLY THE AREA OF EACH FLOOR AS DETERMINED BY NUMBER OF FLOORS TO GET THE BUILT UP AREA, WHICH HAS NOT BEEN DONE. THE AREA OF EACH FLOOR AS PER THE A.O'S WORKING IS 6477.48 SQ FEET. FOR FIFTEEN FLOORS THE BUILT UP AREA WILL BE 97162.20 SQUARE FEET. F.S.I. GRANTED IS 1 I.E. FOR CONSTRUCTION OF 97162.20 SQ FEET THE PLOT S IZE HAS TO BE MINIMUM 9026.65 SQ MTS I.E. MORE THAN ONE ACRE WHICH IS APPROVED BY THE BMC. THE APPELLANT FURTHER SUBMITTED THAT AS PER PLAN THE ITA NO. 3162 / 12 12 ACTUAL PERMISSIBLE AREA FOR INDIAN OCEAN IS 6555.83 SQ MTRS I.E. 70566.95 SQUARE FEET HENCE THE CALCULATION OF T HE BUILDING BEING OF ONLY 6477.48 SQ FEET IS BASELESS. ARCHITECT CERTIFICATE AND PLAN WERE GIVEN IN SUPPORT OF THE ABOVE . THE SECTION NOWHERE TALKS ABOUT AREA OCCUPIED BY THE BUILDING. THE SECTION IS VERY CLEAR THE PLOT SIZE HAS TO BE MINIMUM ONE ACRE; IT DOES NOT TALK ABOUT CONSTRUCTED AREA. THE CONSTRUCTED AREA CANNOT BE EVEN CONSIDERED AS THE INCOME TAX APPLIES TO THE ENTIRE COUNTRY. THE DEVELOPMENT RULES ARE HOWEVER FRAMED STATE WISE AND EVEN CITY WISE. IN LONAVALA THE FSI IS ONLY 0.25. A BUILDER CANNO T CONSTRUCT MORE EVEN IF HE HAS A BIG PLOT. EVEN IF PLOT SIZE IS MORE THAN ONE ACRE CONSTRUCTED AREAS WILL BE LESS. THE APPELLANT FURTHER SUBMITTED THAT THE REASONING AND LOGIC I.E. AREA ACTUALLY UTILIZED FOR CONSTRUCTION IS 12% OF PLOT EARMARKED FOR DEVEL OPMENT OF INDIAN OCEAN BUILDING. IN AN AREA LIKE ANDHERI IN MUMBAI IN NORMAL COURSE, NO DEVELOPER WOULD LEAVE AROUND 88 % AREA OF THE PLOT VACANT - IS IRRELEVANT AND THE CALCULATION IS WRONG. THE IMPORTANT FACT IS THAT CONSTRUCTION IS DECIDED BY THE DEVELOP MENT RULES FRAMED BY THE BMC AND THE BUILDER HAS NO FREEDOM IN THE AREA TO BE CONSTRUCTED. HE HAS TO FOLLOW THE RULES FRAMED BY BMC. IN CERTAIN CASES IN MUMBAI CITY ITSELF THE BMC HAS GIVEN 4 FSI, IN SOME AREAS 1.33 FSI, IN SOME AREAS 1 FSI. 3.3 DECISION 3.3.1 I HAVE CAREFULLY CONSIDERED THE CONTENTION OF THE APPELLANT AND ALSO CAREFULLY GONE THROUGH THE DOCUMENTS AVAILABLE ON RECORD. IT IS SEEN THAT THE APPELLANT IS A PVT. LTD. COMPANY AND IS IN THE BUSINESS OF CONSTRUCTION. THE APPELLANT RESIDENTIAL B UILDING PROJECT IS SITUATED AT GILBERT HILL, ANDHERI WHICH THE APPELLANT ACQUIRED IN THE YEAR 1993. THE ENTIRE AREA OF THE LAND ADMEASURES ABOUT 40803.10 SQ.MTRS. WHICH IS APPROX. 10 ACRES OF LAND. THE APPELLANT COMPANY DECLARED PROFITS FOR TWO RESIDENTIAL PROJECTS DURING THE A.Y. 2006 - 07 VIZ. ATLANTIC SAGAR AND INDIAN OCEAN BUILDINGS AND ALSO SALE OF FSI IN RESPECT OF PACIFIC TOWER, A RESIDENTIAL PROJECT, SITUATED ON THE SAME LAND. THE APPELLANT CLAIMED DEDUCTION/ S. 80IB IN RESPECT OF INDIAN OCEAN PROJECT AND NOT IN RESPECT OF ATLANTIC SAGAR AS ACCORDING TO IT, IT FULFILL ALL CONDITIONS LAID DOWN IN SECTION 80IB. NO DEDUCTION WAS CLAIMED IN RESPECT OF ATLANTIC SAGAR PROJECT AS CLAIMED BY THE LD.AO. 3.3.2 BEFORE, I PROCEED TO DECIDE THE ISSUE IT IS IMPORT ANT TO EXTRACT THE RELEVANT PROVISION OF THE SECTION 80IB(10) AS IT STOOD AT THE RELEVANT PERIOD OF TIME. THE PROVISIONS OF THE SECTION STATES AS UNDER: - '80 - LB. DEDUCTION IN RESPECT OF PROFITS AND GAINS FROM CERTAIN INDUSTRIAL UNDERTAKINGS OTHER THAN IN FRASTRUCTURE DEVELOPMENT UNDERTAKINGS. (10) THE AMOUNT OF PROFITS IN CASE OF AN UNDERTAKING DEVELOPING AND BUILDING HOUSING PROJECTS APPROVED BY A LOCAL AUTHORITY, SHALL BE HUNDRED PER CENT OF THE PROFITS DERIVED IN ANY PREVIOUS YEAR RELEVANT TO ANY ASSE SSMENT YEAR FROM SUCH HOUSING PROJECT IF, - ITA NO. 3162 / 12 13 (A) SUCH UNDERTAKING HAS COMMENCED OR COMMENCES DEVELOPMENT AND CONSTRUCTION OF THE HOUSING PROJECT ON OR AFTER THE 1 ST DAY OF OCTOBER , 1998, AND COMPLETES THE SAME BEFORE THE 31ST DAY OF MARCH, 2001; (B) THE PROJECT IS ON THE SIZE OF A PLOT OF LAND WHICH HAS MINIMUM AREA OF ONE ACRE AND (C) THE RESIDENTIAL UNIT HAS A MAXIMUM BUILT - UP AREA OF ONE TH OUSAND SQUARE FEET WHERE SUCH RESIDENTIAL UNIT IS SITUATED WITHIN THE CITIES OF DE LHI OR MUMBAI OR WITHIN TWENTY- FIVE KILOMETERS FROM THE MUNICIPAL LIMITS OF THESE CITIES AND ONE THOUSAND AND FIVE HUNDRED SQUARE FEET AT ANY OTHER PLACE. ' FOR BRINGING THIS PROVISION, THE NOTES ON CLAUSES TO THE FINANCE BILL, 1999 HAS EXPLAINED THAT, THE PROVISION ALSO SEEKS TO PROV IDE THAT FOR APPROVED HOUSING PROTECTS THE PROFITS WHICH ARE FULLY DEDUCTIBLE, THE BUILT - U P AREA IN REGIONS OTHER THAN OUTSIDE TWENTY - FIVE KMS OF MUNICIPAL LIMITS OF DELHI AND MUNICIPAL LIMITS OF DELHI AND MUMBAI THE BUILT - UP AREA OF THE RESIDENTIAL UNITS DOES NOT EXCEED ONE THOUSAND FIVE HUNDRED SQUARE FEET. 3.3.3 FURTHER, THE MEMO CONTAINED IN FINANCE BILL, 1999 HAS EXPLAINED THE PROVISIONS BROUGHT BY THE LEGISLATURE W.E.F. 1ST APRIL, 2000 AND THE SAME READS AS UNDER: 'TAX INCENTIVE FOR PROMOTION OF H OUSING LIBERALIZATION OF TAX HOLIDAY TO APPROVED HOUSING PROJECTS - UNDER S. 80 - IA OF THE IT ACT, PROFITS OF APPROVED HOUSING PROJECTS WHERE THE DEVELOPMENT AND CONSTRUCTION COMMENCES ON OR AFTER 1 ST OCT., 1998 AND IS COMPLETED BY 31 ST MARCH, 2001 ARE FU LLY DEDUCTIBLE. THE CONDITIONS NECESSARY FOR CLAIMING THE BENEFIT ARE THAT THE APPROVED HOUSING PROJECT SHOULD BE ON MINIMUM AREA OF ONE ACRE AND SHOULD HAVE DWELLING UNITS MAY BE UP TO A MAXIMUM LIMIT OF BUILT UP AREA OF 1000 SQ.FT. IT IS PROPOSED TO MOD IFY THE EXISTING BENEFITS TO PROVIDE THAT IN AREAS OTHER THAN FALLING IN AND WITHIN 25 KMS. FROM THE MUNICIPAL LIMITS OF DELHI AND MUMBAI, THE BUILT UP AREA OF DWELLING UNITS MAY BE UP TO A MAXIMUM LIMIT OF 1500 SQ.FT. INSTEAD OF 1000 SQ.FT. AT PRESENT TO MAKE THEM ENTITLED FOR BENEFIT. THE BUILT UP AREA FOR AREAS FALLING IN DELHI AND MUMBAI AND WITHIN25 KMS. OF THE MUNICIPAL LIMITS OF BOTH, ,HOWEVER, SHALL REMAIN THE SAME. THE PROPOSED AMENDMENT WILL TAKE EFFECT FROM 1ST APRIL, 2000, AND WILL, ACCORDINGLY , APPLY IN RELATION TO THE ASST. YR. 2000 - 01 AND SUBSEQUENT YEARS. ' 3.3.4 IN ORDER TO BE ELIGIBLE UNDERTAKING, DEVELOPING AND BUILDING HOUSING PROJECTS AND FOR CLAIMING DEDUCTION UNDER S. 80 - IB(10), FINANCE ACT, 2000 W.E.F. 1ST APRIL, 2000 HAS LAID DOW N VARIOUS CONDITIONS AND THE PROVISIONS OF S. 80 - IB AMENDED BY VARIOUS ITA NO. 3162 / 12 14 FINANCE ACTS AS AMENDED W.E.F. 1ST APRIL, 2000 BY THE FINANCE ACT, 2000 AND BY THE FINANCE ACT, 2003 AND AS SUBSTITUTED BY THE FINANCE (NO. 2) ACT, 2004, THE HOUSING PROJECTS MUST BE AP PROVED ON OR BEFORE 31ST MARCH, 2007 BY THE LOCAL AUTHORITY. THESE PROVISIONS ENVISAGE FURTHER THAT FOR THE ELIGIBILITY OF DEDUCTION UNDER S.80 - IB(10) OF PROFITS FROM SUCH HOUSING PROJECTS, THE FOLLOWING CONDITIONS ARE TO BE COMPLIED WITH: (A) SUCH HOUSIN G PROJECTS MUST BE APPROVED FROM THE LOCAL AUTHORITY. (B) SUCH U N D ERTAKING HAS COMMENCED OR COMMENCES DEVELOPMENT AND CONSTRUCTION OF HOUSING PROJECTS ON OR AFTER 1 ST OCT.,1998 AND COMPLETED SUCH CONSTRUCT I ON. (I) FOR ASST. YRS. 2000 - 01 TO 2001 - 02 ON OR BEFORE 31ST MARCH, 2002. (II) FOR ASST. YRS. 2002 - 03 TO 2004 - 05 WITHOUT ANY DATE. (III) FOR AND FROM ASST. YR. 2005 - 06 AS AMENDED BY THE FINANCE (NO. 2) ACT, 2004 W.E. F . 1ST APRIL, 2005 - (1) IN A CASE WHERE HOUSING PROJECT HAS BEEN APPROVED BY THE LOC AL AUTHORITY ON OR BEFORE 1ST APRIL, 2004, ON OR BEFORE 31ST MARCH, 2008. (2) WHERE HOUSING PROJECT HAS BEEN APPROVED BY THE LOCAL AUTHORITY ON OR AFTER 1ST APRIL, 2004 WITHIN FOUR YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH HOUSING PROJECT HAS BEE N APPROVED BY THAT LOCAL AUTHORITY. 3.3.5 FURTHER, THE EXPLANATION AS BROUGHT OUT BY THE FINANCE (NO. 2) ACT, 2004 W.E. F . 1ST APRIL, 2005 FOR THE PURPOSES OF THIS CLAUSE READS AS UNDER: '(I) IN A CASE WHERE THE APPROVAL IN RESPECT OF THE HOUSING PROJEC T IS OBTAINED MORE THAN ONCE, SUCH HOUSING PROJECT SHALL BE DEEMED TO HAVE BEEN APPROVED ON THE DATE ON WHICH THE BUILDING PLAN OF SUCH HOUSING PROJECT IS FIRST APPROVED BY THE LOCAL AUTHORITY; (II) THE DATE OF COMPLETION OF CONSTRUCTION OF THE HOUSING P ROJECT SHALL BE TAKEN TO BE THE DATE ON WHICH THE COMPLETION CERTIFICATE IN RESPECT OF SUCH HOUSING PROJECT IS ISSUED BY THE LOCAL AUTHORITY. ' AND CONDITION (B) IS THAT THE PROJECT HAS TO BE ON THE SIZE OF A PLOT OF LAND WHICH HAS A MINIMUM AREA OF ONE ACRE. FURTHER, THE PROVISO TO S. 80 - IB(10) AT THE END OF CL. (B) AS BROUGHT OUT BY THE FINANCE (NO. 2) ACT, 2004 W.E.. 1ST APRIL, 2005 PROVIDES AS UNDER: 'NOTHING CONTAINED IN CL. (A) OR CL. (B) OF S. 80 - IB(10) SHALL APPLY TO A HOUSING PROJECT CARRIED O UT IN ACCORDANCE WITH A SCHEME FRAMED BY THE CENTRAL GOVERNMENT OR A STATE GOVERNMENT FOR RECONSTRUCTION OR REDEVELOPMENT OF EXISTING BUILDINGS IN AREAS DECLARED TO BE SLUM AREAS UNDER ANY LAW FOR THE TIME BEING IN FORCE AND SUCH SCHEME IS NOTIFIED BY THE BOARD IN THIS BEHALF' CLAUSES (C) AND (D) AS BROUGHT OUT BY THE FINANCE (NO. 2) ACT, 2004 W.E.F. 1ST APRIL, 2005 READS AS UNDER: ITA NO. 3162 / 12 15 (C) THE RESIDENTIAL UNIT HAS A MAXIMUM BUILT - UP AREA OF ONE THOUSAND SQUARE FEET WHERE SUCH RESIDENTIAL UNIT IS SITUATED WI THIN THE CITIES OF DELHI OR MUMBAI OR WITHIN TWENTY-FIVE KILOMETERS FROM THE MUNICIPAL LIMITS OF THESE CITIES AND ONE THOUSAND AND FIVE HUNDRED SQUARE FEET AT ANY OTHER PLACE; AND (D) ( W.E.F .1ST APRIL, 2005) THE BUILT - UP AREA OF THE SHOPS AND OTHER COMME RCIAL ESTABLISHMENTS INCLUDED IN THE HOUSING, PROJECT DOES NOT EXCEED FIVE PER CENT OF THE AGGREGATE BUILT - UP AREA OF THE HOUSING PROJECT OR TWO THOUSAND SQUARE FEET, WHICHEVER IS LESS. 11 3.3.6 PRIOR TO ITS SUBSTITUTION BY THE FINANCE (NO. 2) ACT, 2004 W.E. F . 1ST APRIL, 2005, SUB - S . (10) AS AMENDED BY THE FINANCE ACT, 2000 W.E.F. 1ST APRIL, 2001 AND FINANCE ACT, 2003 W.E. F . 1ST APRIL, 2002 READS AS UNDER: (10) THE AMOUNT OF PROFITS IN CASE OF AN UNDERTAKING DEVELOPING AND BUILDING HOUSING PROJECTS APP ROVED BEFORE THE 31ST DAY OF MARCH, 2005 BY A LOCAL AUTHORITY, SHALL BE HUNDRED PER CENT OF THE PROFITS DERIVED IN ANY PREVIOUS YEAR RELEVANT TO ANY ASSESSMENT YEAR FROM SUCH HOUSING PROJECT IF, - (A) SUCH UNDERTAKING HAS COMMENCED OR COMMENCES DEVELOPME NT AND CONSTRUCTION OF THE HOUSING PROJECT ON OR AFTER THE 1ST DAY OF OCTOBER, 1998; (B) THE PROJECT IS ON THE SIZE OF A PLOT OF LAND WHICH HAS A MINIMUM AREA OF ONE ACRE; AND (C) THE RESIDENTIAL UNIT HAS A MAXIMUM BUILT - UP AREA OF ONE THOUSAND SQUARE FEET WHERE SUCH RESIDENTIAL UNIT IS SITUATED WITHIN THE CITIES OF DELHI OR MUMBAI OR WITHIN TWENTY - FIVE KILOMETERS FROM THE MUNICIPAL LIMITS OF THESE CITIES AND ONE THOUSAND AND FIVE HUNDRED SQUARE FEET AT ANY OTHER PLACE. 3.3.7 THE CHANGES BROUGHT OUT BY THE SUBSTITUTION BY THE FINANCE (NO. 2) ACT, 2004 W.E.F. 1ST APRIL, 2005 HAVE BEEN EXPLAINED IN NOTES ON CLAUSES OF THE FINANCE (NO.2) ACT, 2004 WHICH READS AS UNDER: UNDER THE EXISTING PROVISIONS CONTAINED IN SUB - SO (10), HUNDRED PER CENT DEDUCTION OF THE PROFITS OF AN UNDERTAKING DEVELOPING AND BUILDING HOUSING PROJECTS IS ALLOWED IF THE HOUSING PROJECT IS APPROVED BY A LOCAL AUTHORITY BEFORE THE 31ST MARCH, 2005 SUBJECT TO THE CONDITIONS SPECIFIED IN CLS. (A) TO (C) OF THE SAID SUB - SECTION. THE EXI STING PROVISIONS OF THE SAID SUB - SECTION PROVIDES THAT (A) THE UNDERTAKING SHOULD HAVE COMMENCED DEVELOPMENT OF THE HOUSING PROJECT AFTER THE 1ST DAY OF OCTOBER, 1998, (B) THE PROJECT SHOULD BE ON A SIZE OF A PLOT OF LAND WHICH HAS A MINIMUM AREA OF ONE AC RE, AND (C) THE RESIDENTIAL UNIT SHOULD HAVE A MAXIMUM BUILT - UP AREA OF ONE THOUSAND SQUAREFEET WHERE SUCH RESIDENTIAL UNITS ARE SITUATED WITHIN THE CITIES OF DELHI OR MUMBAI OR WITHIN TWENTY - FIVE KILOMETERS ITA NO. 3162 / 12 16 FROM THE MUNICIPAL LIMITS OF THESE CITIES AND ON E THOUSAND AND FIVE HUNDRED SQUARE FEET AT ANY OTHER PLACE. SUB - CL. (D) SEEKS TO SUBSTITUTE SUB - SO (L0) OF THE SAID SECTION SO AS TO PROVIDE, INTER ALIA, A HUNDRED PER CENT DEDUCTION OF THE PROFITS DERIVED BY AN UNDERTAKING DEVELOPING AND BUILDING HOUSIN G PROJECTS APPROVED BY A IOCA L AUTHORITY BEFORE 31ST MARCH, 2007 INSTEAD OF 31ST MARCH, 2005 UNDER THE EXISTING PROVISIONS , SUBJECT TO THE CONDITIONS THAT (A) SUCH UNDERTAKING HAS COMMENCED OR COMMENCES DEVELOPMENT AND CONSTRUCTION OF THE HOUSING PROJECT O N OR AFTER 1ST OCT., 1998 AND COMPLETES THE CONSTRUCTION WITHIN FOUR YEARS, FROM THE END OF THE FINANCIAL YEAR IN WHICH THE HOUSING PROJECT IS APPROVED BY THE LOCAL AUTHORITY; (B) THE PROJECT IS ON THE SIZE OF A PLOT OF LAND WHICH HAS A MINIMUM AREA OF ONE ACRE EXCEPT IN THE CASE OF A HOUSING PROJECT CARRIED OUT IN ACCORDANCE WITH A SCHEME FRAMED BY THE CENTRAL GOVERNMENT OR A STATE GOVERNMENT FOR RECONSTRUCTION OR REDEVELOPMENT OF EXISTING BUILDINGS, AND SUCH SCHEME IS NOTIFIED BY THE BOARD IN THIS BEHALF; (C) THE RESIDENTIAL UNIT HAS A MAXIMUM BUILT - UP AREA OF ONE THOUSAND SQUARE FEET WHERE SUCH RESIDENTIAL UNIT IS SITUATED WITHIN THE CITIES OF DELHI OR MUMBAI OR WITHIN TWENTY - FIVE KILOMETERS FROM THE MUNICIPAL LIMITS OF THESE CITIES AND ONE THOUSAND AND F IVE - HUNDRED SQUARE FEET AT ANY OTHER PLACE; AND (D) THE BUILT - UP AREA OF THE SHOPS AND OTHER COMMERCIAL ESTABLISHMENTS INCLUDED IN THE HOUSING PROJECT DOES NOT EXCEED FIVE PER CENT OF THE AGGREGATE BUILT - UP AREA OF HOUSING PROJECT OR TWO THOUSAND SQUARE FE ET, WHICHEVER IS LESS. IT IS FURTHER PROPOSED TO INSERT AN EXPLANATION IN CL. (A) OF THE PROPOSED SUB - SO (10) SO AS TO PROVIDE THAT THE DATE OF APPROVAL SHALL BE THE DATE ON WHICH THE BUILDING PLAN OF THE SAID PROJECT IS FIRST APPROVED BY THE LOCAL AUTHO RITY IN CASE WHERE THE APPROVAL IN RESPECT OF THE SAME IS OBTAINED MORE THAN ONCE AND ALSO TO PROVIDE THAT THE DATE OF COMPLETION OF CONSTRUCTION SHALL BE THE DATE ON WHICH THE COMPLETION CERTIFICATE IS ISSUED BY THE LOCAL AUTHORITY . FURTHER, ALSO THE SA ME PROVISIONS WERE EXPLAINED IN THE MEMORANDUM EXPLAINING THE PROVISIONS IN THE FINANCE (NO. 2) ACT, 2004 WHICH READS AS UNDER: EXTENSION OF THE TIME - LIMIT FOR OBTAINING APPROVAL OF HOUSING PROJECTS FOR THE PURPOSE OF TAX HOLIDAY UNDER S. 80 - IB, AND ALL OWING DEDUCTION FOR REDEVELOPMENT OR RECONSTRUCTION OF EXISTING BUILDINGS UNDER THE EXISTING PROVISIONS CONTAINED IN SUB - SO (10) OF S. 80 - IB, A DEDUCTION EQUAL TO ONE HUNDRED PER CENT OF THE PROFITS OF AN UNDERTAKING DEVELOPING AND BUILDING HOUSING PROJE CTS IS ALLOWED IF THE HOUSING PROJECT IS APPROVED BY A LOCAL AUTHORITY BEFORE 31ST MARCH, 2005. THE DEDUCTION IS SUBJECT TO THE CONDITIONS THAT THE UNDERTAKING SHOULD HAVE COMMENCED DEVELOPMENT OF THE HOUSING PROJECT AFTER THE 1ST DAY OF OCTOBER, 1988, THE PROJECT SHOULD BE ON A SIZE OF A PLOT OF LAND WHICH HAS A MINIMUM AREA OF ONE ACRE AND THAT THE RESIDENTIAL UNIT SHOULD HAVE A MAXIMUM BUILT - UP AREA OF ONE ITA NO. 3162 / 12 17 THOUSAND SQUARE FEET WHERE SUCH RESIDENTIAL UNIT IS SITUATED IN DELHI OR MUMBAI AND ONE THOUSAND AN D FIVE HUNDRED SQUARE FEET AT OTHER PLACES. IT IS PROPOSED TO SUBSTITUTE THE EXISTING SUB - SECTION SO AS TO RATIONALIZE THE PROVISIONS AND PROVIDE ADDITIONAL INCENTIVES. WITH A VIEW TO ALLOW MORE HOUSING PROJECTS TO AVAIL OF THE TAX HOLIDAY UNDER THIS PRO VISION, IT IS PROPOSED TO EXTEND THE TIME - LIMIT FOR OBTAINING APPROVAL FROM THE LOCAL AUTHORITY TO 31ST MARCH, 2007. HOWEVER, IT IS ALSO PROPOSED TO PROVIDE A TIME - LIMIT FOR THE COMPLETION OF THE HOUSING PROJECT WITHIN 4 YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE PROJECT IS APPROVED BY THE LOCAL AUTHORITY. IT IS PROPOSED TO TAKE THE DATE OF APPROVAL AS THE DATE ON WHICH THE BUILDING PLAN IS FIRST APPROVED BY THE LOCAL AUTHORITY AND THE DATE OF COMPLETION OF THE HOUSING PROJECT AS THE DATE ON WHIC H THE COMPLETION CERTIFICATE IS ISSUED BY SUCH AU T HORITY. IT IS FURTHER PROPOSED TO PROVIDE THAT THE BUILT - UP AREA OF THE SHOPS AND OTHER COMMERCIAL ESTABLISHMENTS INCLUDING IN THE HOUSING PROJECT SHALL NOT EXCEED FIVE PER CENT OF THE AGGREGATE BUILT - UP AREA OF THE HOUSING PROJECT OR 2,000 SQ. FT., WHICHEVER IS LESS. WITH A VIEW TO ENCOURAGE THE REDEVELOPMENT OF SLUM DWELLINGS, IT IS PROPOSED TO RELAX THE CONDITION OF MINIMUM PLOT SIZE OF ONE ACRE IN THE CASE OF A HOUSING PROJECT, CARRIED OUT IN ACCORDA NCE WITH A SCHEME FRAMED BY THE CENTRAL GOVERNMENT OR A STATE GOVERNMENT FOR RECONSTRUCTION OR REDEVELOPMENT OF EXISTING BUILDINGS AND NOTIFIED BY THE BOARD IN THIS BEHALF IT IS ALSO PROPOSED TO DEFINE THE EXPRESSION 'BUILT - UP AREA' TO MEAN THE INNER MEA SUREMENTS OF THE RESIDENTIAL UNIT AT THE FLOOR LEVEL, INCLUDING THE PROJECTIONS AND BALCONIES, AS INCREASED BY THE THICKNESS OF THE WALLS BUT NOT INCLUDING THE COMMON AREAS SHARED WITH OTHER RESIDENTIAL UNITS. THESE AMENDMENTS WILL TAKE EFFECT FROM 1ST A PRIL, 2005 AND WILL, ACCORDINGLY, APPLY IN RELATION TO THE ASST. YR. 2005 - 06 AND SUBSEQUENT YEARS. ' 3.3.8 FROM A PLAIN READING OF THE PROVISIONS, THE FOLLOWING CONDITIONS MUST BE SATISFIED TO CLAIM THE D EDUCTION U/ S 80IB(10) OF THE ACT NAMELY; THE P ROJECT SHOULD BE APPROVED BY A LOCAL AUTHORITY BEFORE MARCH 31 ST 2007. THE SIZE OF THE PLOT OF LAND IS A MINIMUM OF ONE ACRE. THE UNDERTAKING COMMENCES DEVELOPMENT AND CONSTRUCTION OF THE HOUSING PROJECT AFTER SEPTEMBER 30, 1998 AND IT SHOULD COMP LETE CONSTRUCTION WITHIN 4 YEARS FROM THE END OF FINAN C IAL YEAR IN WHICH THE ITA NO. 3162 / 12 18 HOUSING PROJECT IS FIRST APPROVED OR BEFORE APRIL L' 2008, WHICHEVER IS LATER. THE BUILT - UP AREA OF THE SHOPS AND OTHER COMMERCIAL ESTABLISHMENTS INCLUDED IN THE HOUSING PROJE CT SHALL NOT EXCEED 5 PER CENT OF THE AGGREGATE BUILT - UP AREA OF THE HOUSING PROJECT OR 2,000 SQ. F T WHICHEVER IS LESS. RETURN OF INCOME SHOULD BE SUBMITTED ON OR BEFORE DUE DATE OF SUBMISSION OF RETURN OF INCOME. THE BUILT - UP AREA OF EACH RESIDEN TIAL UNIT SHOULD BE SUBJECT TO THE FOLLOWING MAXIMUM LIMIT - PLACE WHERE RESIDENTIAL UNIT IS SITUATED MAXIMUM BUILT UP AREA OF EACH RESIDENTIAL UNIT - WITHIN THE CITIES OF DELHI AND MUMBAI 1,000 SQ. FT - WITHIN 25 KMS FROM THE LOCAL LIMITS OF DELHI AN D MUMBAI 1,000 SQ. FT AT ANY OTHER PLACE 1,500 SQ. FT 3.3.9 IT IS ALSO A MATTER OF FACT THE APPELLANT'S PREMISES WERE SURVEYED BY THE REVENUE ON 22.09.2005, ACCORDING TO THE APPELLANT INCOME - TAX OFFICERS DURING SURVEY HAVE PHYSICALLY VERIFIED THE DETAI LS OF THE PROJECT AND AFTER INVESTIGATION AND SEEKING THE APPELLANTS EXPLANATION THE CLAIM O F THE APPELLANT WAS ACCEPTED U/ S. 80IB. THE LD.AO ACCORDINGLY PASSED AN ORDER U/ S. 143(3) OF THE ACT. LATER ON IT SEEMS THAT THE THERE WAS AN AUDIT OBJECTIONS AND THE LD. AO OBJECTED TO THE AUDIT OBJECTIONS VIDE HIS LETTER DATED 13.11.2009, A COPY OF WHICH IS SUBMITTED BY THE LD.AR OF THE APPELLANT (PAGE 63 TO 67 OF THE PAPER BOOK). THEREFORE, THE LD.AO VIGOROUSLY FOLLOWED THE DROPPING OF THE AUDIT OBJECTION AS LATE AS 1.12.2011, HOWEVER, NO REPLY WAS RECEIVED FROM THE SENIOR AUDIT OFFICER LAP - I, MUMBAI AND THEREAFTER ACCORDINGLY, THE LD.AO ISSUED THE NOTICES U/ S. 148 R.W.S. 147 AND FRAMED THE RE - ASSESSMENT. I FIND THA T T HE MAIN OBJECTION OF THE LD.AO THAT THE APPELL ANT'S ONE PROJECT VIZ. ATLANTIC OCEAN STARTED COMMENCED PRIOR TO 1998, THEREFORE, ALL OTHER PROJECTS IRRESPECTIVE THEIR DATE OF C OMMENCEMENT WILL NOT BE ELIGIBLE FOR DEDUCTION U/ S. 80IB. AS IS EVIDENT FROM THE PLAIN READING OF THE PROVISIONS OF SECTION 80 LB THAT THE DEDUCTION IS QUA THE PROJECT AND NOT QUA THE ASSESSEE. THEREFORE IT IS WRONG TO PRESUME THAT IF ANY PROJECT FULFILLING THE CONDITIONS OF SECTION 80IB COMMENCED ITS PRODUCTION AFTER 1998 WILL ALSO B E NOT ELIGIBLE FOR DEDUCTION U/ S. 80IB. EACH PR OJECT IS A SEPARATE PROJECT AND THEREFORE, SEPARATE YARDSTICKS NEED TO BE ADOPTED. MY OBSERVATION GETS SUPPORT FROM THE FINDING BY THE DECISION OF HON'BLE TRIBUNAL IN THE CASE OF SAROJ SALES ORGANIZATION AND VANDANA PROPERTIES (SUPRA). THE APPELLANT AS FAR AS THE APPELLANT'S INDIAN OCEAN BUILDING PROJECT IS CONCERNED THE FOLLOWING FACTS ARE EVIDENT FROM THE FACTS PLACED ON RECORD. ITA NO. 3162 / 12 19 (I) THE PROJECT HAS COMMENCED AFTER 1ST DAY OF OCTOBER, 1998 WHICH IS EVIDENT FROM THE LETTER OF MUNICIPAL CORPORATION OF GREA TER MUMBAI, DATED 06. 10.2001 GIVING LETTER OF IOD U/ S. 346 OF THE BOMBAY MUNICIPAL CORPORATION ACT, AS, AMENDED UP TO DATE WHICH CLEARLY SPECIFY THAT THE PERMISSION WAS ACCORDED TO THE APPELLANT WITH REFERENCE TO HIS NOTICE LETTER NO.337 DATED 24.09.2001 F OR PROPOSED BLDG. NO.3, ON PLOT BEARING CTS NO.254A TO E, VILLAGE ANDHERI, AT GILBER HILL. FURTHER, THE A LETTER DATED 10.05.2002 A COMMENCEMENT CERTIFICATE HAS BEEN ISSUED BY MUNICIPAL CORPORATION OF GREATER MUMBAI. (II) THE PROJECT STOOD COMPLETED ON 2 6.03.2008 I.E. 31.03. 2008 WHICH IS EVIDENT BY THE_ OCCUPATION CERTIFICATE ISSUED BY THE EXECUTOR ENGINEER BUILDING, VIDE HIS LETTER INDICATING THEREIN THAT THE PROJECT WAS COMPLETED ON 26.03.2008 UNDER THE SUPERVISION OF SHRI NITIN SHAH, LICENCE SURVEYOR, LICENCE NO.S/424/LS. IT ALSO CLEARLY INDICATE THAT THE BUILDING NO.3 CONSISTING OF WING A & B COMPRISING OF STILT PLUS 1ST TO 15TH UPPER FLOOR ON PLOT BEARING CTS NO.254, 276 AND 277 OF VILLAGE ANDHERI, SITUATED AT GILBERT HILL, ANDHERI (W), MUMBAI WAS CO MPLETED ON 26.03.2008. FURTHER, THE SITE PLAN APPROVED BY THE BMC CLEARLY INDICATE THAT THE SITE PLAN OF BLDG. NO.3, I.E. THE INDIAN OCEAN APPROVED ON 08.04.2005 IS 6555.83 SQ. MTRS. I.E. NEARLY 70566.95 SQ.FTS. IT IS ALSO A MATTER OF FACT THAT AS PER BMC RULES FSI OF 1.33 IS AVAILABLE DEPENDING ON THE PLOT SIZE. THE PLOT SIZE IS THEREFORE 4929.19 SQ.MTRS. BY DOING THE REVERSE CALCULATION WHICH IS EQUIVALENT TO 1.22 ACRES. THEREFORE, THE PLOT AREA OF THE PROJECT IS MORE THAN 1 ACRE. ( III ) NONE OF THE RESI DENTIAL UNITS AS PER THE PLAN APPROVED BY THE BMC, IT IS FOUND THAT THE AREA OF EACH FLAT IS LESS THAN 1000 SQ.FT, THIS FACT IS ALSO VERIFIED BY THE REVENUE DURING THE SURVEY OPERATION AND THERE IS NO DISPUTE TO THIS FACT. EVEN THE ARCHITECT CERTIFICATE SP ECIFIES THE SAME. (IV) EVEN THE P ROJECT SO APPROVED BY THE BMC DOE S NOT HAVE ANY SHOP OR COMMERCIAL ESTABLISHMENT AS IS EVIDENT BY THE APPROVED SITE PROJECT AS WELL AS BY THE ARCHITECT CERTIFICATE. THE COPY OF THE APPROVED PLAN OF THE BMC IS PLACED ON R ECORD BY THE APPELLANT. (V) THE PERUSAL OF THE APPROVED PLAN BY THE BMC INDICATES THAT THERE ARE 118 FLATS AND FLAT WISE AREAS STATEMENT AS APPROVED BY THE BMC IS ALSO PLACED ON RECORD BY THE APPELLANT. 3.3.10 IN VIEW OF THE FOREGOING, THE LD AO'S CONT ENTION THAT THE PLOT AREA IS LESS THAN 1 ACRE IS ERRONEOUS AND COMPLETELY IGNORES THE FACTS ON RECORD. THE LD.AO HAS WORKED OUT THE AREA ON THE BASIS OF A HILLOCK WHOSE AREA HAS BEEN SHOWN TO 1873.27 SQ.MTRS ON THE ENTIRE PLOT OF AREA AND NOT ON THE AREA T HAT RELATES TO SITE OF BUILDING ATLANTIC OCEAN. THEREFORE, IF THE ENTIRE PLOT AREA IS TAKEN INTO ACCOUNT I.E. 40803.10 SQ.MTRS THE AREA OF THE HILLOCK IS REMARKABLY REDUCED IN PROPORTION THE TOTAL AREA OF THE HILLOCK AND NEARLY COMES TO 4.59%. FURTHER, THE LD.AO HAS NOT TAKEN INTO ACCOUNT THE FACT THAT THE HILLOCK AREA WAS LEVELED BY THE APPELLANT AND ONLY A SMALL PORTION OF 716 SQ.MTRS REMAINED WHICH IS YET TO BE LEVELED FOR THE PURPOSES OF ITA NO. 3162 / 12 20 CONSTRUCTION. THEREFORE, THE COMPUTATION DONE BY THE LD.AO IN ARRI VING AT THE PLOT AREA IS BASED ON WRONG FIGURES ADOPTED BY HIM PURELY BASED ON FORM NO.10CCB WHICH IS FOR THE PURPOSE OF THE ENTIRE DEVELOPMENT ON THE LAND AREA AND GIVES DETAILS OF THE PROFITS EARNED BY THE APPELLANT PROJECT WISE. THEREFORE, THE COMPUTATI ON DONE BY THE LD.AO IS BASED ON THE PRESUMPTION THAT THE ENTIRE HILLOCK AREA IS SITUATED ON THE LAND ON WHICH THE INDIAN OCEAN PROJECT IS SITUATED WHICH APPARENTLY IS NOT EVIDENCED BY THE FACTS ON RECORD. FURTHER, THE LD. AO HAS WORKED OUT THE BUILT UP AR EA OF THE WING A & B IN THE BUILDING. HE STATED THAT THE BUILT UP AREA IN A WING AND B WING RELATES ONLY 4 FLATS WHILE THE FACT IS THAT THE BUILDING IS 15 FLOOR INCLUDING THE STILT AND THE NUMBER OF FLATS ARE 118 AND NOT 4 FLATS IN EACH WING. THEREFORE, EV EN THE WORKING OUT THE BUILT UP OF THE FLAT IS ERRONEOUS. THIS IS EVIDENT BY THE COMPLETE WORKING OF THE BUILT UP AREA APPROVED BY THE BMC. THEREFORE, THERE IS NO MERIT IN THE LD. AO'S COMPUTATION, THE ENTIRE PROJECT HAS BEEN APPROVED BY THE BMC AND THEY H AVE ALSO INDICATED THE PERMISSIBLE BUILT UP AREA OF THE BUILDING NO.3 AT 6553.83 SQ. MTRS. THE REMAINING OBSERVATION OF THE LD.AO IS BASED ON THE BUILT UP AREA WHICH IS ERRONEOUS AS EVIDENT FROM THE FACTS ON RECORD. THEREFORE, THE ENTIRE REASON S FOR NOT GR ANTING DEDUCTION U/S. 80LB ARE BASED ON C ONJECTURE AND SURMISES, COMPLETELY DIVORCED FROM THE FACTS ON RECORD. THE INADVERTENT FACT OF THE CASE ARE THAT THE PROJECT IS APPROVED BY THE LOCAL AUTHORITY, THE PROJECT COMMENCED PRODUCTION ON 10.03.2002 I.E. AFT ER 1ST OF OCTOBER, 1998, AND THE PROJECT WAS COMPLETED ON 26 - 3 - 2008. THE AREA OF THE PROJECT IS MORE THAN AN ACRE I.E. 4981.96 SQ. MTRS. AND THE APPELLANT HAS OBTAINED THE COMPLETION CERTIFICATE FROM THE LOCAL AUTHORITIES. IN VIEW OF THE FOREGOING, THE IRRE SISTIBLE CONCLUSION IS THAT THE APPELLANT IS ENTITLED FOR DEDUCTION U/S.80IB. THEREFORE, THE DISALLOWANCES MADE BY THE LD. AO ARE NOT SUSTAINABLE BOTH ON FACTS AND IN LAW AND IS ACCORDINGLY DELETED. 4. AGAINST THE ABOVE ORDER OF CIT(A) THE REVENUE IS IN APPEAL BEFORE US CHALLENGING THE ACTION OF CIT(A) NOT ONLY FOR VALIDITY OF REOPENING BUT ALSO AGAINST THE DELETION OF DISALLOWANCE U/S.80IB(10). 5. WE HAVE CONSIDERED RIVAL CONTENTIONS AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. IN THIS CASE ASSESSMENT WAS REOPENED AFTER IT WAS COMPLETED UNDER SCRUTINY ASSESSMENT U/S.143(3) CONSEQUENT TO SURVEY UNDERTAKEN AT ASSESSEES PREMISES, WHEREIN THE AO HAS MADE DETAILED ENQUIRY AND AFTER RECORDING DETAILED FINDING ON EACH POINT OF ASSESSEES CLA IM OF DEDUCTION U/S.80IB(10) WAS ALLOWED. ITA NO. 3162 / 12 21 THEREAFTER ASSESSMENT WAS REOPENED BY ISSUE OF NOTICE U/S.148. WHILE DECIDING THE APPEAL, CATEGORICAL FINDING HAS BEEN RECORDED BY THE CIT(A) TO THE EFFECT THAT DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS U/S.143(3) ENTIRE DETAILS AND APPROVED PLAN OF ITS PROJECT BY BMC AND OTHER EVIDENCE WHICH UNEQUIVOCALLY SUPPORTS THE ASSESSEES CONTENTION THAT THE PROJECT GOT COMPLETED ON 26 - 3 - 2008 AND COMMENCED WELL AFTER OCTOBER, 1998 , WERE FILED AND CONSIDERED . THUS , THERE WAS TOTAL ABSENCE OF TANGIBLE MATERIAL TO JUSTIFY THE CONCLUSION THAT INCOME H AS ESCAPED ASSESSMENT IN THE RELEVANT ASSESSMENT YEAR. THERE WAS NO MATERIAL BEFORE THE AO WHICH COULD LEAD TO THE FORMATION OR BELIEF THAT THE INCOME HAD ESCAPED ASSESSM ENT. AFTER RECORDING DETAILED FINDING AND APPLYING THE PROPOSITION OF LAW LAID DOWN BY THE HONBLE SUPREME COURT AND THE HIGH COURT, THE CIT(A) HAS ANNULLED THE REOPENING U/S.147 OF THE ACT. 6. WITH REGARD TO MERIT OF THE DISALLOWANCE, WE FOUND THAT SITE P LAN OF THE PROJECT WAS APPROVED BY THE BMC IN RESPECT OF INDIAN OCEAN PROJECT ON 8 - 4 - 2005 WAS 6555.83 SQ.MTRS. OF LAND. THE CIT(A) EVEN AFTER APPLYING THE REVERSE CALCULATION WITH REGARD TO BMC RULES FSI OF 1.33 FOUND THAT THE PLOT SIZE WAS 4929.19 SQ.MTRS ., WHICH IS EQUIVALENT TO 1.22 ACRES. THUS, THE CONTENTION OF THE AO THAT PLOT SIZE OF THE INDIAN OCEAN PROJECT WAS BELOW 1 ACRE IS INCORRECT. THE CIT(A) HAS ALSO RECORDED A CATEGORICAL FINDING TO THE EFFECT THAT NONE OF THE RESIDENTIAL UNIT WAS MORE THAN 1000 SQ.FT. THIS FACT WAS ALSO VERIFIED BY THE REVENUE AUTHORITIES DURING THE SURVEY OPERATION CARRIED OUT AT ASSESSEES PROJECT SITE EVEN BEFORE ORIGINAL ASSESSMENT U/S.143(3) WHEREIN ASSESSEES CLAIM U/S.80IB(10) ITA NO. 3162 / 12 22 WAS ALLOWED . WE FOUND THAT AO HAS WORKED OUT THE AREA ON THE BASIS OF A HILLOCK WHOSE AREA HAS BEEN SHOWN TO 1873.27 SQ.MTR.S ON THE ENTIRE PLOT OF AREA AND NOT ON THE AREA THAT RELATES TO SITE OF BUILDING ATLANTIC OCEAN. THEREFORE, IF THE ENTIRE PLOT AREA IS TAKEN INTO ACCOUNT I.E. 40803.10 SQ.M TRS. THE AREA OF THE HILLOCK IS REMARKABLY REDUCED IN PROPORTION THE TOTAL AREA OF THE HILLOCK AND NEARLY COMES TO 4.59%. THUS, THE COMPUTATION DONE BY THE AO IN ARRIVING AT THE PLOT AREA IS BASED ON WRONG FIGURES ADOPTED BY HIM. THE CIT(A) HAS RECORDED A CATEGORICAL FINDING TO THE EFFECT THAT THE COMPUTATION DONE BY THE AO WAS BASED ON THE PRESUMPTION THAT THE ENTIRE HILLOCK AREA IS SITUATED ON THE LAND ON WHICH THE INDIAN OCEAN PROJECT IS SITUATED, WHICH APPARENTLY IS NOT EVIDENCED BY THE FACTS ON RECORD. THE DETAILED FINDING RECORDED BY CIT(A) AT PARA 3 HAS NOT BEEN CON TROVERTED BY LD. DR BY BRINING A N Y POSITIVE MATERIAL ON RECORD. WE, THEREFORE, DO NOT FIND ANY REASON TO INTERFERE IN THE FINDINGS RECORDED BY THE CIT(A) WHICH MAKES THE PROJECT ELIGIBLE FO R CLAIM OF DEDUCTION U/S.80IB(10) OF THE ACT. 7 . IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 15/05 /2015 . 15/05 /2015 SD/ - SD/ - ( ) ( JOGINDER SINGH ) ( . . ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 15/05 /201 5 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT ITA NO. 3162 / 12 23 / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//