M/S. HAWARE ENGINEERS & BUILDERS PVT. LTD, NAVI MUMBAI V. THE ACIT -29, MUMBAI

ITA 6431/MUM/2007

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7850 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 10-03-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 22-10-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: NARENDRA SINGH
• Keywords: Search and seizure; Retrospective amendment
• Section: 143(3); 80IB

Judgement Text

ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 1 OF 17 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI H BENCH, MUMBAI BEFORE SHRI R V EASWAR, HONBLE PRESIDENT, AND SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 HAWARE ENGINEERS & BUILDERS PVT LTD .. APPELLANT 413/416, VARDHMAN MARKET, SECTOR 17 DBC, VASHI, NAVI MUMBAI 400 705 PAN : AACH2577C VS. ASSTT COMMISSIONER OF INCOME TAX CIRCLE 29, MUMBAI .. RESPONDENT APPEARANCES: S R WADHVA, FOR THE APPELLANT NARENDRA SINGH, FOR THE RESPONDENT O R D E R PER PRAMOD KUMAR : 1. BY WAY OF THIS APPEAL, THE ASSESSEE HAS CALLED I NTO QUESTION CORRECTNESS OF CIT(A)S ORDER DATED 2 ND AUGUST 2007, IN THE ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961, F OR THE ASSESSMENT YEAR 2004-05. ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 2 OF 17 2. THE ASSESSEE IS ENGAGED IN CONSTRUCTION OF THE BUILDING PROJECTS AND THE SHORT ISSUE THAT WE ARE REQUIRED TO ADJUDICATE IN THIS APPEAL IS WHETHER OR NOT THE CIT(A) WAS JUSTIFIED IN UPHOLDIN G THE ACTION OF ASSESSING OFFICER IN DECLINING DEDUCTION UNDER SECT ION 80 IB (10) IN RESPECT OF SHANTI NIKETAN PROJECT (RS 12,44,455), B ALAJI TOWERS PROJECT (RS 3,77,36,037) AND SILICON TOWER PROJECT (RS 5,11,74, 506). LET US TAKE UP THESE THREE CLAIMS OF DEDUCTION UNDER SECTION 80IB (10) ONE BY ONE. SHANTINIKETAN PROJECT 3. BRIEFLY STATED, THE MATERIAL FACTS ARE LIKE THIS . DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSING OFFI CER NOTICED THAT THE ASSESSEE HAS CLAIMED A DEDUCTION UNDER SECTION 80 I B (10), AMOUNTING TO RS 12,44,455 IN RESPECT OF SHANTINIKETAN PROJECT. THE ASSESSING OFFICER HAD, HOWEVER, TWO OBJECTIONS TO THIS CLAIM OF DEDUC TION FIRST, THAT AREA OF PLOT OF LAND IS 4,000.02 SQUARE METERS, WHICH IS LE SS THAN ONE ACRE (ONE ACRE IS EQUAL TO 4,046.82 SQUARE METERS); AND SEC OND, THAT BUILT UP AREA OF SHOPS AND COMMERCIAL UNITS IS 4,302.88 SQUARE FE ET, WHICH IS MORE THAN 2,000 SQUARE FEET. AS REGARDS THE SECOND POINT, I.E . REGARDING BUILT UP AREA OF COMMERCIAL UNITS BEING MORE THAN 2,000 SQUARE FE ET, THE ASSESSING OFFICER NOTED THE SAME, BUT DID NOT DEAL WITH THE S AME IN MUCH DETAIL. THE ASSESSING OFFICER NOTED THAT THIS RESIDENTIAL PROJE CT WAS DEVELOPED BY THE ASSESSEE ON 4,000.02 SQUARE METER LAND ALLOTTED BY CITY & INDUSTRIAL DEVELOPMENT CORPORATION OF MAHARASHTRA LIMITED (CID CO, IN SHORT), AS PLOT NUMBER 8 A, ON 6 TH FEBRUARY, 2001. IT WAS ALSO NOTED THAT CONSTRUCTION WAS COMPLETED ON 28 TH MAY 2002, AND THAT THE OCCUPATION CERTIFICATE OF THE PROJECT WAS ALSO ISSUED ON 11 TH JULY 2002. THE ASSESSING OFFICER WAS OF THE VIEW THAT SINCE SIZE OF PLOT WAS ADMITTEDLY LESS THAN ONE ACRE ( I.E. 4,046.82 SQUARE METERS), THE ASSESSEE W AS NOT ENTITLED TO DEDUCTION UNDER SECTION 80 IB (10). WHILE THE ASSES SING OFFICER NOTED THAT ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 3 OF 17 THE ASSESSEE WAS SUBSEQUENTLY ALLOTTED AN ADJACENT PLOT, ADMEASURING 48.13 SQUARE METERS, BY CIDCO AS PLOT NUMBER 8B, HE ALSO HELD THAT THIS SUBSEQUENT ALLOTMENT DID NOT MAKE GOOD THIS DEFICIE NCY IN ELIGIBILITY FOR ENTITLEMENT TO DEDUCTION UNDER SECTION 80 IB(10) BE CAUSE ADDITIONAL LAND WAS ALLOTTED TO THE ASSESSEE FOR PURPOSE OF PLAYING GROUND/ GREEN AREA ONLY, AND, AS PER TERMS SPECIFIED BY CIDCO, NO DEVE LOPMENT OR CONSTRUCTION WAS PERMITTED THEREIN AND ADDITIONAL LAND, AS SUCH, COULD NEVER HAVE BEEN UTILIZED FOR DEVELOPMENT OF HOUSING PROJECT. THE ASSESSING OFFICER ALSO NOTED THAT, BY WAY OF THIS, EVEN THOUGH THE AGREEMENT DATED 1.4.2003 ( WHEREBY CIDCO ALLOTTED THE PLOT NO. 8 B, ADMEASURING 48.13 SQUARE METERS, TO THE ASSESSEE) MODIFIES THE ORIGINAL ASSESSMENT RETROSPECTIVELY, THE FACT REMAINS THAT T HE ORIGINAL PLOT OF 4000.27 SQUARE METERS ONLY WAS UTILIZED FOR HOUSING PROJECT, AND THERE WAS NO DEVELOPMENT ON ADDITIONAL PLOT FOR THE SIMPL E REASON THAT THE ADDITIONAL PLOT WAS NOT AVAILABLE TO THE ASSESSEE A T ALL AND EVEN OTHERWISE, ADDITIONAL PLOT IS ACTUALLY A SEPARATE P LOT (PLOT 8 B) DISTINCT FROM THE ORIGINAL PLOT (PLOT 8A). IT WAS THUS CONC LUDED THAT, THE ASSESSEES CONTENTION THAT AREA OF ADDITIONAL PLOT SHOULD ALSO BE INCLUDED FOR CONSIDERING AREA OF HOUSING PROJECT IS, THEREFO RE, UNACCEPTABLE. AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BE FORE THE CIT(A) BUT WITHOUT ANY SUCCESS. THE ASSESSEES PLEA TO THE EFF ECT THAT SUBSEQUENT ALLOTMENT OF AN ADJACENT PLOT, ADMEASURING 48.13 SQ UARE METERS, BY CIDCO, AS PLOT NUMBER 8B, MADE GOOD THIS DEFICIENCY IN ELI GIBILITY FOR ENTITLEMENT TO DEDUCTION UNDER SECTION 80 IB(10), WAS REJECTED BY THE CIT(A) ON THE GROUND THAT IT IS CERTAINLY NOT THE INTENTION OF L EGISLATURE THAT HOUSING PROJECTS, WHICH HAVE ALREADY BEEN COMPLETED ON A SM ALLER PLOT, WILL ALSO BE ELIGIBLE FOR DEDUCTION [UNDER SECTION 80 IB(10)] IF SUBSEQUENTLY IT BUYS ADDITIONAL ADJACENT LAND TO MAKE THE TOTAL AREA MOR E THAN ONE ACRE. THE CIT(A) ALSO NOTED THAT PLOT NUMBER 8B ALLOTTED BY CIDCO WAS NOT TO BE USED FOR ANY CONSTRUCTION BUT WAS TO BE DEVELOPED A S GREEN BELT TO BE USED AS CHILDRENS PLAYGROUND WHICH WILL ALSO HAVE ACCES S TO PUBLIC AT LARGE, AND ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 4 OF 17 OBSERVED THAT IT WAS THUS MANIFESTLY CLEAR THAT TH E APPELLANT HAS TRIED TO GET ITS IRREGULAR CLAIM OF DEDUCTION UNDER SECTION 80 IB(10) REGULARIZED THROUGH THE ALLOTMENT OF ADDITIONAL PLOT NUMBER 8B . THE CIT(A), ACCORDINGLY, CONCLUDED THAT ADDITIONAL LAND CANNOT BE REGARDED AS PART OF THE ORIGINAL PROJECT AS IT HAS NEITHER BEEN ALLOTTE D EXCLUSIVELY FOR THE PROJECT NOR HAS BEEN USED FOR HOUSING PROJECT AND THE SIZE OF ORIGINAL PLOT BEING MARGINALLY LESS THAN ONCE ACRE, THE ASSE SSEE WAS NOT ENTITLED FOR DEDUCTION UNDER SECTION 80 IB (10). THE DISALLOWAN CE WAS THUS CONFIRMED BY THE CIT(A) AS WELL. THE ASSESSEE IS NOT SATISFIE D BY THE STAND SO TAKEN BY THE CIT(A), AND IS IN FURTHER APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED THE FACTUAL MATRIX OF TH E CASE AS ALSO THE APPLICABLE LEGAL POSITION. 5. WE HAVE NOTED THAT THOUGH THERE IS NO DISPUTE AB OUT THE FACT THAT SIZE OF THE ORIGINAL PLOT ON WHICH HOUSING PROJECT WAS DEVELOPED WAS LESS THAN ONE ACRE, THE ASSESSEE WAS SUBSEQUENTLY ALLOTT ED AN ADJACENT PLOT WHICH MADE GOOD THIS DEFICIENCY SO FAR AS REQUIREME NT ABOUT MINIMUM SIZE OF PLOT WAS CONCERNED. THE CLAIM FOR DEDUCTION UNDER SECTION 80 IB (10) HAS, HOWEVER, BEEN REJECTED BY THE ASSESSING O FFICER ON THE GROUND THAT NO DEVELOPMENT OR CONSTRUCTION WAS PERMITTED THEREON, AND, THEREFORE, THIS ADDITIONAL LAND COULD NEVER HAVE B EEN UTILIZED FOR DEVELOPMENT OF HOUSING PROJECT, AS ALSO ON THE GRO UND THAT ADDITIONAL PLOT IS ACTUALLY A SEPARATE PLOT (PLOT 8 B) DISTINC T FROM THE ORIGINAL PLOT (PLOT 8A). THE FIRST LIMB OF THESE OBJECTIONS, REG ARDING UTILIZATION OF ADDITIONAL LAND FOR CONSTRUCTION, HOWEVER PROCEEDS ON THE FALLACY THAT ONLY SUCH PLOT AREA CAN BE INCLUDED IN THE SIZE OF THE P LOT ON WHICH CONSTRUCTION IS PERMISSIBLE. IT IS IMPORTANT TO BEAR IN MIND THA T IT IS AREA OF THE PLOT, ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 5 OF 17 AND NOT BUILT UP AREA, WHICH IS RELEVANT FOR THE PU RPOSE OF DECIDING ELIGIBILITY OF THE PROJECT. SECTION 80 IB(10) (B) P ROVIDES THAT THE HOUSING PROJECT, IN ORDER TO BE ELIGIBLE FOR DEDUCTION, MUS T, INTER ALIA, SATISFY THE CONDITION THAT ( B ) THE PROJECT IS ON THE SIZE OF A PLOT WHICH WAS A MINIMUM AREA OF ONE ACRE. IT IS CLEARLY AREA OF THE PLOT AND NOT BUILT UP AREA WHICH IS IMPORTANT TO DETERMINE ELIGIBILITY IN TERMS OF SECTION 80 IB (10)(B). IN OUR CONSIDERED VIEW, THE SIZE OF THE PL OT INCLUDES ENTIRE AREA OF THE PROJECT WHICH IS DEVELOPED BY THE BUILDER FOR T HE RESIDENTS OF THE PROJECT, INCLUDING ALL COMMON AREAS AND PUBLIC AMEN ITIES FOR THE RESIDENTS OF THE PROJECT, AND CANNOT BE CONFINED TO ONLY SUCH AREA ON WHICH CONSTRUCTION IS PERMISSIBLE. WHETHER CONSTRUCTION I S PERMISSIBLE ON THE ADDITIONAL LAND OR NOT IS WHOLLY IRRELEVANT AS LONG IT IS NOT IN DISPUTE THAT THE SAID ADDITIONAL LAND WAS ACTUALLY ALLOTTED, WIT H OR WITHOUT CONDITIONS, FOR THE PURPOSES OF THE PROJECT. WE HAVE ALSO NOTED THAT, VIDE ALLOTMENT DATED 6 TH APRIL 2004 (PAGES 27- 30 OF PAPERBOOK, @ PAGE 28), THE LAND USE PERMITTED, FOR THE ADDITIONAL LAND SO ALLOTTED, WAS ONLY FOR THE PURPOSE OF DEVELOPMENT OF GREEN BELT OR CHILDREN PLAYGROUND FOR THE MEMBERS OF THE SOCIETY (EMPHASIS SUPPLIED BY US ), BUT THEN DEVELOPMENT OF GREEN BELT OR CHILDREN PLAYGROUND FOR THE MEMBERS OF THE SOCIETY CANNOT BUT BE AN INTEGRAL PART OF THE HOUSING PROJECT ITSELF. UNDO UBTEDLY, THE LEASE DEED IN FAVOUR OF THE SOCIETY (PAGES 31 TO 36,@PAGE34) PROV IDES THAT THE LICENSEE SHALL DEVELOP GREEN BELT OR CHILDRENS PLAYGROUND FOR THE MEMBERS OF THE SOCIETY ON THE SAME (PLOT) , WHICH WILL HAVE FREE ACCESS TO PUBLIC AT LARGE WITHOUT DISCRIMINATION ON THE GROUND OF RELIGION, C ASTE, CREED ETC., BUT THE EXPRESSION PUBLIC AT LARGE IN THIS SENTENCE I S TO BE READ IN CONJUNCTION WITH THE WORDS IMMEDIATELY FOLLOWING TH ESE WORDS, I.E. WITHOUT DISCRIMINATION ON THE GROUND OF RELIGION, C ASTE, CREED ETC.. IT IS NOT A CASE THAT THE ASSESSEE HAS BEEN PERMITTED TO DEVELOP A PUBLIC PARK IN THE ADDITIONAL LAND SO ALLOTTED, AND THE BENEFIT TO THE RESIDENTS IN THIS PROJECT IS ONLY INCIDENTAL; IN FACT, IT IS THE OTHE R WAY ROUND. THE DEVELOPMENT IN THIS LAND, AS A PARK OR CHILDRENS P LAYGROUND OR AS GREEN ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 6 OF 17 BELT, IS FOR THE PURPOSES OF THE RESIDENTS OF THE P ROJECT AS HAS BEEN SPECIFICALLY APPROVED BY CIDCO, AND THE BENEFIT TO OTHERS, IF AT ALL, IS ONLY INCIDENTAL. THE ADDITIONAL LAND IS AS MUCH A PART OF THE HOUSING PROJECT AS MUCH THE ORIGINAL PLOT IS, AS EVIDENT FROM THE FACT THAT SUPPLEMENTARY AGREEMENT, TO LEASE OUT ADDITIONAL LAND, IS NOT EVE N A STANDALONE AGREEMENT BUT IT ONLY SEEKS TO MODIFY THE ORIGINAL LEASE BY I NCLUDING PLOT NUMBER 8 B IN THE AREA ALLOTTED FOR HOUSING PROJECT. THE MERE FACT THAT CERTAIN CONDITIONS HAVE BEEN PUT FOR USE OF ADDITIONAL LAND DOES NOT TAKE AWAY THE FACT THAT ADDITIONAL LAND IS AN INTEGRAL PART OF TH E HOUSING PROJECT WHICH, CONSEQUENT TO THE ADDITIONAL LAND HAVING BEEN ALLOT TED, NOW STANDS ON PLOT NO. 8A AND 8B, AS AGAINST PLOT NO. 8A ORIGINALLY, C OLLECTIVELY SHOWN, IN LOCATION PLAN ATTACHED TO THE MODIFIED AGREEMENT, A S AREA ALLOTTED TO ASSESSEE FOR THE HOUSING PROJECT. IT IS ALSO IMPORT ANT TO BEAR IN MIND THAT THE CENTRAL BOARD OF DIRECT TAXES ITSELF, VIDE CIRC ULAR NO. 5/ 2005 DATED 15 TH JULY 2005 HAS OBSERVED THAT THIS SECTION [ I.E. 80 IB (10)] DOES NOT SPECIFICALLY PROVIDE AREA LIMIT FOR THE GARDEN, THE DEVELOPMENT PLAN ROADS, INTERNAL MEANS OF ACCESS, ETC. IN THE HOUSIN G PROJECT. THEREFORE, THE SAME SHOULD CONFORM TO THE PROJECT PLAN APPROVED BY THE LOCAL AUTHORITY IN ACCORDANCE WITH THE REGULATIONS IN FORCE. THIS ALSO MAKES IT CLEAR THAT EVEN AREAS OF GARDENS, DEVELOPMENT PLAN ROADS ETC. ARE TO BE TREATED AS PART OF THE HOUSING PROJECT AS LONG AS THE SAME ARE APPROVED BY LOCAL AUTHORITY IN ACCORDANCE WITH THE REGULATIONS IN FOR CE. IT IS, THEREFORE, NOT CORRECT TO PROCEED ON THE BASIS THAT AREAS NOT USED FOR CONSTRUCTION, SUCH AS GARDEN AND ROADS ETC., WILL NOT BE INCLUDED IN T HE AREA OF THE PROJECT. THE LOCAL AUTHORITY IN THE PRESENT CASE IS CIDCO IT SELF AS THE HOUSING PROJECT HAS BEEN APPROVED BY CIDCO (PAGE 14 OF THE PAPER-BOOK) AND COMMENCEMENT AND COMPLETION CERTIFICATES HAVE BEEN ISSUED BY CIDCO (PAGES 15-17 AND 37-38 OF THE PAPER-BOOK), AND IT IS IN ACCORDANCE WITH THE SPECIFIC PERMISSION OF CIDCO THAT THE ADDITIONA L LAND HAS BEEN DEVELOPED, FOR THE USE OF MEMBERS OF THE SOCIETY, A S GREEN BELT AND CHILDRENS PLAYGROUND. THE USE OF ADDITIONAL LAND, THEREFORE, HAS TO BE ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 7 OF 17 TREATED AS A PART OF THE APPROVED PROJECT. THE OTHE R OBJECTION OF THE ASSESSING OFFICER WAS THAT PLOT NO. 8 B IS A DISTIN CT PLOT AND, THEREFORE, IT CANNOT BE INCLUDED IN THE HOUSING PROJECT. WE SEE N O SUBSTANCE IN THIS PLEA EITHER. AS EVIDENT FROM LOCATION PLAN ATTACHED TO THE MODIFIED LEASE AGREEMENT, PLOT 8A AND 8B ARE ADJACENT TO EACH OTHE R AND ARE COLLECTIVELY SHOWN AS BELONGING TO THIS PROJECT. IT IS NOT EVEN NECESSARY THAT AREA OF EACH PLOT, ON STANDALONE BASIS, MUST AT LEAST BE ON E ACRE. ONCE IT IS NOT IN DISPUTE THAT THESE TWO PLOTS ARE ADJACENT PLOTS WHI CH CAN BE VIEWED AS A COHESIVE UNIT, AS ARE THE ADMITTED FACTS OF THIS CA SE, DEDUCTION UNDER SECTION 80 IB (10) CANNOT BE DECLINED ONLY ON THE G ROUND THAT THE PLOT ON WHICH HOUSING PROJECT IS BUILT ORIGINALLY CONSISTS OF MORE THAN ONE UNITS. IN ANY EVENT, EVEN THE LEASE AGREEMENT EXECUTED BY CIDCO IS ONLY ONE, AND BY WAY OF ALLOTMENT OF ADDITIONAL LAND, ONLY THE OL D AGREEMENT IS MODIFIED WITH RETROSPECTIVE EFFECT. WHEN LEASE AGREEMENT I S ONE, PLOT 8 A AND 8 B ARE ADJACENT PLOTS AND A COHESIVE UNIT ON WHICH PRO JECT IS NOW SITUATED, DECLINING DEDUCTION UNDER SECTION 80 IB(10) ON THE GROUND THAT PLOT 8B IS A DISTINCT PLOT IS NEITHER FACTUALLY CORRECT NOR SU STAINABLE IN LAW. THE GROUND ON WHICH THE ASSESSING OFFICER DECLINED DEDU CTION UNDER SECTION 80 IB(10) ARE THUS DEVOID OF LEGALLY SUSTAINABLE ME RITS. 6. AS REGARDS LEARNED CIT(A)S OBSERVATIONS TO THE EFFECT THAT IT IS MANIFESTLY CLEAR THAT THE APPELLANT HAS TRIED TO GE T ITS IRREGULAR CLAIM OF DEDUCTION UNDER SECTION 80 IB(10) REGULARIZED THROU GH THE ALLOTMENT OF ADDITIONAL PLOT NUMBER 8B, AND THAT IT IS NOT INTE NTION OF LEGISLATURE THAT THAT HOUSING PROJECTS, WHICH HAVE ALREADY BEEN COM PLETED ON A SMALLER PLOT, WILL ALSO BE ELIGIBLE FOR DEDUCTION [UNDER SECTION 80 IB(10)] IF SUBSEQUENTLY IT BUYS ADDITIONAL ADJACENT LAND TO MA KE THE TOTAL AREA MORE THAN ONE ACRE, WE ARE UNABLE TO SEE ANY MERITS IN THESE OBSERVATIONS EITHER. IN CASE AN ASSESSEE FINDS THAT HE IS NOT EL IGIBLE FOR DEDUCTION UNDER SECTION 80 IB(10) BECAUSE SIZE OF THE PLOT, ON WHIC H PROJECT IS BUILT, IS LESS THAN MINIMUM NECESSARY SIZE, AND HE MAKES GOOD THAT DEFICIENCY, AND ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 8 OF 17 ENSURES THAT ALL THE NECESSARY PRECONDITIONS ARE SA TISFIED AND APPROVALS OBTAINED, THE ASSESSEE IS ELIGIBLE FOR DEDUCTION UN DER SECTION 8 IB(10). THE FACT THAT HE SATISFIED THE CONDITIONS LATER DOES NO T ADVERSELY AFFECT ITS CLAIM FOR DEDUCTION. WHAT IS MATERIAL IS THAT AT TH E POINT OF TIME WHEN MATTER COMES UP FOR EXAMINATION OF THE CLAIM, THE N ECESSARY PRECONDITIONS FOR BEING ELIGIBLE TO THE CLAIM ARE S ATISFIED, AND THAT IS THE CASE BEFORE US. THE DEDUCTION UNDER SECTION 80 IB(1 0) IS, THEREFORE, ADMISSIBLE ON THE FACTS OF THIS CASE. WE MAKE IT C LEAR THAT WE HAVE ARRIVED AT THESE CONCLUSIONS ON THE PECULIAR FACTS OF THIS CASE, AND CONSIDERING SMALLNESS OF THE SIZE OF ADDITIONAL PLOT OF LAND WH ICH IS JUST 48.13 METERS, AND THIS DECISION SHOULD, THEREFORE, NOT BE CONSTRU ED AS OF GENERAL APPLICATIONS IN ALL SUCH CASES WHERE ADDITIONAL PLO T OF LAND HAS BEEN ADDED SUBSEQUENTLY IN THE PROJECT. AS REGARDS THE COMMERC IAL BUILT UP AREA BEING IN EXCESS OF 2,000 SQUARE FEET, WE HAVE NOTED THAT THE ISSUE IS NOW SQUARELY COVERED BY HONBLE BOMBAY HIGH COURTS JUD GMENT IN THE CASE OF CIT VS. BRAHMA ASSOCIATES ( 51 DTR 298 ) WHEREIN T HEIR LORDSHIPS HAVE HELD THAT THE RESTRICTION ON THE AREA OF COMMERCIAL USE OF BUILT UP AREA COMES INTO PLAY ONLY WITH EFFECT FROM 2005. THE ASS ESSMENT YEAR BEFORE US IS 2004-05 AND, THEREFORE, USE OF COMMERCIAL ARE IN EXCESS OF 2,000 SQUARE FEET DOES NOT VITIATE ASSESSEES CLAIM FOR D EDUCTION UNDER SECTION 80 IB (10). IN VIEW OF THESE DISCUSSIONS AND BEARI NG IN MIND ENTIRETY OF THE CASE, WE HOLD THAT THE ASSESSEE WAS ELIGIBLE FO R DEDUCTION UNDER SECTION 80 IB(10) IN RESPECT OF SHANTINIKETAN PROJE CT. WE DIRECT THE ASSESSING OFFICER TO GRANT THE SAID DEDUCTION. 7. GRIEVANCE OF THE ASSESSEE, AGAINST CIT(A)S UPH OLDING THE DISALLOWANCE OF DEDUCTION UNDER SECTION 80 IB(10) I N RESPECT OF SHANTINIKETAN PROJECT, IS THUS UPHELD. ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 9 OF 17 BALAJI TOWERS PROJECT 8. AS FAR AS THIS PROJECT IS CONCERNED, THE RELEVAN T MATERIAL FACTS ARE LIKE THIS. DURING THE COURSE OF THE ASSESSMENT PROC EEDINGS, THE ASSESSING OFFICER NOTICED THAT LAND, ON WHICH THIS PROJECT WA S DEVELOPED, WAS LEASED BY CIDCO TO A PARTNERSHIP FIRM BY THE NAME OF DANIK PUNDHARI. THIS LAND CONSISTED OF PLOT NOS. 29 TO 32 AND 36 TO 37 SITUAT ED AT SECTOR 30, VASHI, NAVI MUMBAI, AND THE TOTAL LAND AREA WAS 7,999.79 S QUARE METERS. THE ASSESSING OFFICER NOTED THAT, OUT OF TOTAL BUILT UP AREA OF 11,997.813 SQUARE METER, PERMISSIBLE FSI BEING 1.5 OF THE PLOT SIZE I.E. 7,999.79 SQUARE METERS, ONLY 6,231.742 SQUARE METER. THE ASS ESSING OFFICER WAS OF THE VIEW THAT, THUS IT CAN BE CLEARLY SEEN THAT TH E DEVELOPMENT UNDERTAKEN ON THE SAID PLOT OF LAND IS PREDOMINANTLY AND SUBST ANTIALLY IN NATURE OF COMMERCIAL ESTABLISHMENT. IT WAS ALSO NOTED THAT CERTAIN RESIDENTIAL UNITS, VIZ. A/105, B/107, C/102, C/106, C/107, C/20 7, C/607, C/707 AND C/303, HAVE BUILT UP AREA EXCEEDING 1,000 SQ. FTS. ( CALCULATED AS PREDETERMINED PERCENTAGE OF SUPER BUILT UP AREA/ SA LEABLE AREA MENTIONED IN THE AGREEMENT AND AFTER TAKING INTO CONSIDERATI ON THE AREA OF ATTACHED TERRACE). IT WAS IN THIS BACKDROP THAT THE ASSESSI NG OFFICER DECLINED DEDUCTION UNDER SECTION 80 IB (10) IN RESPECT OF TH IS PROJECT AS WELL. AGGRIEVED BY THE STAND SO TAKEN BY THE ASSESSING OF FICER, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A) BUT WITHOUT ANY SUCCESS. LEARNED CIT(A), RELYING UPON A COORDINATE BENCH DECISION OF THIS TRIBUNAL IN THE CASE OF LAUKIK DEVELOPERS VS DCIT (105 ITD 657), CO NCLUDED AS FOLLOWS: IT IS VERY CLEAR FROM THE DECISION OF HONBLE MUMBA I BENCH OF THE ITAT ( IN THE CASE OF LAUKIK DEVELOPERS) THAT NO DEDUCTION UNDER SECTION 80 IB- (10) IS ALLOWABLE IF THE CONST RUCTION PROJECT OF THE ASSESSEE IS NOT APPROVED BY THE LOCAL AUTHOR ITY AS HOUSING PROJECT. IN THE PRESENT CASE, PROJECT OF THE APPELLANT HAS BEEN APPROVED AS PRESS CUM HOUSING CUM RESIDE NTIAL PROJECT. THEREFORE, FOLLOWING THE DECISION OF THE ITAT, MUMBAI BENCHES, MENTIONED ABOVE, IT IS HELD THAT THE CONST RUCTION PROJECT OF THE APPELLANT, NAMELY BALAJI TOWER, IS N OT ENTITLED TO ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 10 OF 17 DEDUCTION UNDER SECTION 80 IB (10). IN VIEW OF THIS FINDING, IT IS NOT NECESSARY TO EXAMINE WHETHER AREA OF SOME OF I NDIVIDUAL FLATS WERE MORE THAN 1,000 SQ. FT. RENDERING THE AP PELLANT INELIGIBLE FOR DEDUCTION UNDER SECTION 80 IB (10). THE APPEAL OF THE APPELLANT, ON THIS POINT, IS, ACCORDINGLY, DISM ISSED . 9. THE ASSESSEE IS AGGRIEVED AND IS IN APPEAL BEFOR E US. 10. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED TH E MATERIAL ON RECORD AND DULY CONSIDERED FACTUL MATRIX OF THE CAS E AS ALSO THE APPLICABLE LEGAL POSITION. 11. WE FIND THAT THE BASIC REASON OF THE IMPUGNED D ISALLOWANCE OF DEDUCTION IS THAT THE PROJECT WAS NOT APPROVED AS A HOUSING PROJECT BUT AS A HOUSING CUM COMMERCIAL PROJECT, AND BECAUSE THE P ROJECT HAD SUBSTANTIAL COMMERCIAL AREA. THE ISSUE AS TO WHAT S HOULD BE DONE IN SUCH CASES CAME UP BEFORE A SPECIAL BENCH OF THIS TRIBUN AL IN THE CASE OF BRAHMA ASSOCIATES VS JCIT (119 ITD 255). THAT WAS A CASE IN WHICH THE PROJECT WAS NOT APPROVED AS A HOUSING PROJECT BUT A S RESIDENTIAL + COMMERCIAL PROJECT, AND DEDUCTION UNDER SECTION 80 IB (10) WAS DECLINED, FOLLOWING COORDINATE BENCH DECISION IN THE CASE OF LAUKIK DEVELOPERS (SUPRA), ON THE GROUND THAT IT WAS NOT A HOUSING PR OJECT. THE SPECIAL BENCH, INTER ALIA, HELD THAT AS LONG AS THE RESID ENTIAL USE OF BUILT-UP AREA IS 90 PER CENT OR MORE, IT CANNOT BE SAID THAT THE PROJECT IS NOT A PREDOMINANTLY HOUSING PROJECT AND, ACCORDINGLY, DED UCTION UNDER SECTION 80-IB(10) CANNOT BE DECLINED. IT WAS THUS HELD TH AT A COMMERCIAL BUILT UP AREA OF UPTO 10 PERCENT WOULD NOT VITIATE THE EN TITLEMENT FOR DEDUCTION UNDER SECTION 80 IB (10). HOWEVER, WHEN MATTER TRAVELLED IN FURTHER APPEAL BEFORE HONBLE BOMBAY HIGH COURT, TH EIR LORDSHIPS HELD THAT NO SUCH LIMIT ON COMMERCIAL USE WERE JUSTIFIED . ON THE FACTS OF THIS VERY CASE, IN WHICH THE PROJECT WAS ADMITTEDLY A RE SIDENTIAL CUM COMMERCIAL PROJECT, THEIR LORDSHIPS, INTER ALIA, OB SERVED AS FOLLOWS : ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 11 OF 17 ..IN THE PRESENT CASE, IT IS NOT IN DISPUTE THAT THE PROJECT IS APPROVED FOR RESIDENTIAL AND COMMERCIAL BUILDINGS A S PER THE DC RULES, PUNE. THE FACT THAT THE RESIDENTIAL BUILD INGS UNDER THE DC RULES CAN HAVE COMMERCIAL USER UPTO 50% OF T HE BUILT- UP AREA OF THE PLOT CANNOT BE A GROUND TO HOLD THAT THE PROJECT IS NOT A HOUSING PROJECT. IT IS FOR THE LEGISLATURE TO IMPOSE RESTRICTIONS ON COMMERCIAL USER IN A PROJECT FOR TH E PURPOSES OF AVAILING SECTION 80IB(10) DEDUCTION AND THAT HAS BE EN DONE BY INSERTING CLAUSE (D) TO SECTION 80IB(10) WITH EFFEC T FROM 1/4/2005. THEREFORE, THE DECISION OF THE TRIBUNAL I N HOLDING THAT A PROJECT WITH RESIDENTIAL AND COMMERCIAL USER TO THE EXTENT PERMITTED UNDER DC RULES WOULD BE A HOUSING PROJECT AND HENCE ELIGIBLE FOR DEDUCTION UNDER SECTION 80IB (10) UPTO 31/3/2005 CANNOT BE FAULTED. 27. THE QUESTION THEN TO BE CONSIDERED IS, WHETHER THE SPECIAL BENCH OF THE TRIBUNAL WAS JUSTIFIED IN HOLDING THAT THE PROJECTS HAVING COMMERCIAL AREA UPTO 10% OF THE BUILT-UP ARE A OF THE PLOT ARE ELIGIBLE FOR DEDUCTION SECTION 80IB(10) ON THE ENTIRE PROJECT UPTO 1/4/2005. ONCE THE BASIC ARGUMENT OF T HE REVENUE THAT THE HOUSING PROJECTS WITH COMMERCIAL USER ARE NOT ENTITLED TO SECTION 80IB(10) DEDUCTION IS REJECTED, THEN IN THE ABSENCE OF ANY RESTRICTION IMPOSED UNDER THE ACT, IT WAS NO T OPEN TO THE TRIBUNAL TO HOLD THAT THE PROJECTS APPROVED BY THE LOCAL AUTHORITIES HAVING RESIDENTIAL BUILDINGS WITH COMME RCIAL USER UPTO 10% OF THE PLOT AREA WOULD ALONE BE ENTITLED T O DEDUCTION UNDER SECTION 80IB(10). AS NOTED EARLIER, RESTRICTI ON REGARDING COMMERCIAL USER HAS BEEN IMPOSED FOR THE FIRST TIME BY INTRODUCING CLAUSE (D) TO SECTION 80IB(10) WITH EFF ECT FROM 1/4/2005. 12. IT IS THUS CLEAR THAT, AS THE LAW STANDS NOW IN THE LIGHT OF HONBLE JURISDICTIONAL HIGH COURTS JUDGMENT IN THE CASE OF BRAHMA ASSOCIATES (SUPRA), AS LONG AS PROJECT IS AN APPROVED PROJECT, EVEN AS COMMERCIAL CUM RESIDENTIAL AS WAS THE POSITION IN BRAHMA ASS OCIATES CASE (SUPRA) AND AS THE POSITION IN THE PRESENT CASE, DEDUCTION UNDER SECTION 80 IB (10) CANNOT BE DECLINED ON THE GROUND THAT IT IS NO T A PURELY RESIDENTIAL PROJECT OR ON THE GROUND THAT IT HAS SUBSTANTIAL CO MMERCIAL BUILT UP AREA. AS FOR THE CO ORDINATE BENCH DECISION IN THE CASE O F LAUKIK ENTERPRISES (SUPRA), IT WAS OVERRULED BY THE SPECIAL BENCH DECI SION IN THE CASE OF ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 12 OF 17 BRAHMA ASSOCIATES AND HONBLE BOMBAY HIGH COURT HAS UPHELD THE ACTION OF THE SPECIAL BENCH IN THIS REGARD. THE VERY FOUN DATION OF IMPUGNED DISALLOWANCE THUS DOES NOT HOLD GOOD IN LAW ANY LON GER. 13. THE OTHER OBJECTION OF THE ASSESSING OFFICER WA S THAT THE SIZE OF SOME OF THE RESIDENTIAL UNITS WAS MORE THAN ONE THO USAND SQUARE FEET. HOWEVER, EVEN ACCORDING TO THE ASSESSING OFFICER, T HIS WORKING WAS CALCULATED AS PREDETERMINED PERCENTAGE OF SUPER BU ILT UP AREA/ SALEABLE AREA MENTIONED IN THE AGREEMENT AND AFTER TAKING IN TO CONSIDERATION THE AREA OF ATTACHED TERRACE. THE EXPRESSION BUILT U P AREA HAS BEEN DEFINED, WITH EFFECT FROM 1 ST APRIL 2005, INNER MEASUREMENTS OF THE RESIDENTIA L UNIT AT THE FLOOR LEVEL, INCLUDING THE PROJECTIONS AND BALCONIES, AS INCREASED BY THE THICKNESS OF THE WALLS BUT DOES NO T INCLUDE THE COMMON AREAS SHARED WITH OTHER RESIDENTIAL UNITS. HOWEVE R, SO FAR AS THE RELEVANT ASSESSMENT YEAR IS CONCERNED, ADMITTEDLY T HE EXPRESSION BUILT UP AREA WAS AN UNDEFINED EXPRESSION UNDER THE INCO ME TAX ACT, 1961, AND, THEREFORE, MEANING ASSIGNED TO THIS EXPRESSION WERE AS UNDERSTOOD IN COMMON PARLANCE. AS TO THE QUESTION WHETHER ARE A OF BALCONIES COULD BE INCLUDED IN THE DEFINITION OF BUILT UP AREA FO R ASSESSMENT YEARS PRIOR TO 2005-06, WE FIND THIS ISSUE IS NOW COVERED BY A COORDINATE BENCH DECISION IN THE CASE OF ACIT VS SHETH DEVELOPERS PV T LTD (33 SOT 277) WHEREIN COORDINATE BENCH HAS, INTER ALIA, OBSERVED AS FOLLOWS: 18. NOW COMING TO THE SECOND QUESTION WHICH IS WHET HER BALCONY IS TO BE CONSTRUED AS A PART OF THE BUILT-UP AREA. ACC ORDING TO THE ASSESSING OFFICER IF THE BALCONY AREA IS ALSO ADDED , THE BUILT-UP AREA WOULD EXCEED 1000 SQ. FT. PER UNIT IN NUMBER OF CAS ES. FOR RESOLVING THIS WE HAVE TO ONCE AGAIN GO BACK TO THE DEFINITIO N OF BUILT-UP AREA INTRODUCED BY THE FINANCE (NO. 2) ACT, 2004, AS CLA USE ( A ) TO SUB- SECTION (14) OF SECTION 80-IB AND FIRST DECIDE WHET HER IT IS RETROSPECTIVE OR NOT. FOR BREVITY, THIS DEFINITION IS REPRODUCED ONCE AGAIN HEREUNDER : (14) FOR THE PURPOSE OF THIS SECTION: ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 13 OF 17 ( A ) BUILT-UP AREA MEANS THE INNER MEASUREMENTS OF T HE RESIDENTIAL UNIT AT THE FLOOR LEVEL, INCLUDING THE PROJECTIONS AND BALCONIES, AS INCREASED BY THE THICKNESS OF THE WALLS BUT DOES NOT INCLUDE THE COMMON AREAS SHARED WITH OTHER RESIDENTIAL UNITS. THOUGH, BOTH THE LEARNED D.R. AS WELL AS THE LEARNE D A.R. HAVE DELVED INTO A LARGE NUMBER OF CASES FOR THEIR RESPE CTIVE CONTENTIONS FOR AND AGAINST RETROSPECTIVITY, WE FIND THAT THE A NSWER TO THIS QUESTION CAN BE FOUND EASILY FROM THE DEFINITION IT SELF. THE DEFINITION SAYS BUILT-UP AREA INCLUDE PROJECTION AND BALCONIES. THE ACCEPTED RULES OF INTERPRETATION FOR AN INCLUSIVE D EFINITION AS ELUCIDATED BY THE HONBLE APEX COURT IN THE CASE OF CIT V. TAJ MAHAL HOTEL AIR 1972 SC 168 IS THAT IF THE WORD INCLUDE IS U SED IN AN INTERPRETATION CLAUSE, IT MUST BE CONSTRUED AS COMP REHENDING NOT ONLY SUCH THINGS AS IT SIGNIFY ACCORDING TO THEIR N ATURE AND IMPORT, BUT ALSO THINGS WHICH THE INTERPRETATION CLAUSE DEC LARES THAT THEY SHALL INCLUDE. SO NORMAL MEANING OF BUILT-UP AREA, BUT FOR THE DEFINITION INCLUDING PROJECTION AND BALCONY, WOULD DEFINITELY 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 THE EXTE RNAL WALLS. THEREFORE, THERE CAN BE NO DOUBT THAT PRIOR TO THE INTRODUCTION OF THE DEFINITION CLAUSE AFORESAID, BUILT-UP AREA WOUL D NOT INCLUDE PROJECTIONS AND BALCONIES AS NORMALLY UNDERSTOOD. N OW THE QUESTION WHETHER THE DEFINITION CLAUSE MENTIONED AB OVE CAN BE DEEMED AS RETROSPECTIVE, WE ARE AFRAID WE HAVE TO A NSWER AGAINST THE REVENUE. NUMBER ONE, THE ENACTMENT ITSELF CLEAR LY SPECIFIES THAT CLAUSE WILL HAVE EFFECT FROM 1-4-2005. NUMBER TWO, IT IS NOT A PROCEDURAL SECTION BUT A DEFINITION SECTION, WHERE AN ENLARGED MEANING IS GIVEN TO THE TERM BUILT-UP AREA AND SU CH ENLARGED MEANING WOULD NOT HAVE BEEN IN THE REALM OF UNDERST ANDING OF ANY PERSON, PRIOR TO ITS INTRODUCTION, AND ASSESSEES WO ULD HAVE GONE AHEAD WITH THEIR RESPECTIVE PROJECTS BASED ON A COM MON UNDERSTANDING OF THE TERM BUILT-UP AREA. THUS, THE ENLARGED MEANING, IF GIVEN A RETROSPECTIVE EFFECT, WILL DEFI NITELY AFFECT THE VESTED RIGHTS OF AN ASSESSEE. THEREFORE, WE HAVE NO HESITATION TO CONCLUDE THAT THE DEFINITION HAD ONLY PROSPECTIVE E FFECT FROM 1-4- 2005. WE ARE ROBORANTED IN TAKING THIS VIEW BY THE DECISION OF THE SPECIAL BENCH IN BRAHMA ASSOCIATES CASE ( SUPRA ), WHERE AMENDMENT TO SECTION 80-IB(10) ALSO EFFECTED THROUG H SAME FINANCE (NO. 2) ACT, 2004, WERE CONSIDERED TO HAVE ONLY PROSPECTIVE EFFECT, VIS-A-VIS SUB-CLAUSE ( D ) THEREOF. NO DOUBT IN THE CASE OF DY. CIT V. ANSAL PROPERTIES & INDUSTRIES LTD. [2009] 116 ITD 253 DELHI BENCH OF THE TRIBUNAL HAS TAKEN A VIEW THAT EXTENSION OF TIME-LIMIT FOR COMPLETION OF PROJECT, BROUGHT INTO THE STATUTE ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 14 OF 17 THROUGH AN AMENDMENT WHICH CAME INTO EFFECT FROM 1- 4-2001 WOULD APPLY PRIOR TO THAT AS WELL. HOWEVER, THERE T HE ISSUE WAS THE EXTENSION OF A BENEFIT OF TIME-LIMIT AND THIS CANNO T BE TREATED AS EQUIVALENT TO INTRODUCTION OF A DEFINITION WHICH HI THERTO BEFORE HAD A DIFFERENT MEANING AS UNDERSTOOD IN COMMON BUSINES S PARLANCE. EVEN OTHERWISE, REVENUE IS PRECLUDED FROM TAKING TH E PLEA THAT SUCH DEFINITION IS HAVING RETROSPECTIVE EFFECT FOR THE SIMPLE REASON THAT ASSESSING OFFICER HIMSELF HAD ACCEPTED IT TO B E ONLY PROSPECTIVE. VARIOUS CONTENTIONS OF THE LEARNED DR THAT THERE CAN BE NO ESTOPPEL AGAINST LAW EVEN IF THE ASSESSING OF FICER HIMSELF HAD TAKEN A DIFFERENT VIEW BECOMES IRRELEVANT ON THE FA CE OF OUR FINDING THAT DEFINITION OF BUILT-UP AREA IS ONLY PROSPECTIV E WITH EFFECT FROM 1-4-2005. THUS PRIOR TO 1-4-2005, BALCONY WOULD NOT FORM PART OF THE BUILT-UP AREA, IRRESPECTIVE OF THE AREA OF SUCH BALCONY. 14. IN VIEW OF THE VIEW SO ADOPTED BY THE COORDINAT E BENCH, WITH WHICH WE ARE IN RESPECTFUL AGREEMENT, AREA OF BALCONY CAN NOT BE INCLUDED IN THE BUILT UP AREA. THE ASSESSING OFFICER THUS CLEARLY E RRED IN INCLUDING THE AREA OF BALCONY. WE HAVE ALSO NOTED THAT, AS NOTED BY THE SPECIAL AUDITOR APPOINTED BY THE REVENUE AUTHORITIES (PAGE 116 OF T HE PAPERBOOK), IF AREA OF THE BALCONY IS TO BE EXCLUDED, NONE OF THE FLATS WILL EXCEED THE AREA OF ONE THOUSAND SQUARE FEET. THERE IS THUS NO LEGALLY SUSTAINABLE MERITS IN ASSESSING OFFICERS OBJECTIONS WITH REGARD TO THE S IZE OF THE FLAT AS WELL. ONCE BALCONY AREA IS EXCLUDED, EVEN ACCORDING TO TH E REVENUE AUTHORITIES, NO FLAT IS OF MORE THAN ONE THOUSAND SQUARE FEET. 15. LEARNED COUNSEL HAS SUBMITTED THAT DEDUCTION UN DER SECTION 80 IB (10) HAS BEEN ALLOWED IN RESPECT OF THIS PROJECT, I N THE PRECEDING ASSESSMENT YEARS, BY SETTLEMENT COMMISSION, AND FOL LOWING THE PRINCIPLES OF CONSISTENCY, WE MUST ALLOW THE SAME FOR THIS YEA R AS WELL. SOME ARGUMENTS WERE ADVANCED ON THE ISSUE AS TO WHETHER ORDERS OF SETTLEMENT COMMISSION HAVE PRECEDENTIAL VALUE. HOWEVER, HAVING REGARD TO THE FACT THAT THE ISSUE HAS BEEN DECIDED ON MERITS, WE DO NO T CONSIDER IT NECESSARY TO DEAL WITH THESE ARGUMENTS AND ADJUDICATE UPON TH E SAME. ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 15 OF 17 16. ONE MORE ARGUMENT OF THE ASSESSEE HAS BEEN THAT AS FAR AS ASSESSEE IS CONCERNED, ITS PROJECT IS ONLY FOR THE RESIDENTI AL UNITS AND THE ASSESSEE CONSTRUCTED OTHER COMMERCIAL AREA FOR LESSEE OF THE LAND, IN CONSIDERATION OF SO USING THE LAND AND FSI FOR RESIDENTIAL PURPOS ES. IT IS SUBMITTED THAT LAND WAS ALLOTTED TO DANIK PUNDHIR AND, IT WAS IN C ONSIDERATION OF ASSESSEE DOING CONSTRUCTION FOR THEIR NEEDS AS PRESS, THE AS SESSEE WAS ALLOWED TO USE THE AREA FOR RESIDENTIAL USE. THE PROJECT OF TH E ASSESSEE WAS THUS ONLY WITH REGARD TO THE HOUSING UNITS BUILT BY THE ASSES SEE, AND WHAT HAS BEEN BUILT AS COMMERCIAL UNITS AND FOR PRESS, IS IN FACT CONSIDERATION FOR ALLOWING THE ASSESSEE TO DEVELOP RESIDENTIAL SEGMEN T OF THE OVERALL PROJECT. HOWEVER, IN VIEW OF THE FACT THAT THE QUANTUM OF CO MMERCIAL CONSTRUCTION, IN VIEW OF HONBLE BOMBAY HIGH COURTS DECISION IN THE CASE OF BRAHMA ASSOCIATES (SUPRA), IS NOT COMING IN THE WAY OF ASS ESSEES ENTITLEMENT FOR DEDUCTION UNDER SECTION 80 IB(10), WE SEE NO NEED T O ADJUDICATE UPON, OR DEAL WITH, THESE CONTENTIONS EITHER. 17. IN VIEW OF THE ABOVE DISCUSSIONS, WE UPHOLD AS SESSEES CLAIM OF DEDUCTION UNDER SECTION 80 IB (10) IN RESPECT OF BA LAJI TOWERS PROJECT AS WELL. THE IMPUGNED DISALLOWANCE IS DELETED. THE ASS ESSEE WILL GET THE RELIEF ACCORDINGLY. SILICON TOWER PROJECT 18. THE FACTS RELATING TO SILICON TOWER PROJECTS AR E BROADLY THE SAME AS BALAJI TOWERS PROJECT. IT WAS A CASE IN WHICH 8,200 SQUARE METER PLOT, I.E. PLOT NO. 46 AT SECTOR NO. 30 A SANAPADA, NAVI MUMBA I, WAS ALLOTTED BY CIDCO TO PARBHODHAN PRAKASHAN, AND, IN COLLABORATIO N WITH THE SAID CONCERN, THE ASSESSEE CONSTRUCTED THE RESIDENTIAL C UM COMMERCIAL PROJECT. ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 16 OF 17 OUT OF TOTAL BUILT UP AREA OF 12,295 SQUARE METERS, RESIDENTIAL AREA WAS ONLY 9,036 SQUARE METERS. THE DEDUCTION WAS DECLIN ED ON THE GROUND THAT THE PROJECT WAS NOT A HOUSING PROJECT AND BECAUSE S OME OF THE FLATS, AFTER INCLUDING THE BALCONY AREA, EXCEED THE REQUISITE SI ZE OF ONE THOUSAND SQUARE FEET. THE CIT(A) ALSO CONFIRMED THE ACTION O F THE ASSESSING OFFICER BY FOLLOWING THE STAND TAKEN BY HIM IN THE MATTER O F BALAJI PROJECT. THE ASSESSEE IS AGGRIEVED AND IS IN FURTHER APPEAL BEFO RE US. 19. LEARNED REPRESENTATIVES AGREE THAT WHATEVER WE DECIDE FOR BALAJI TOWER PROJECT WILL FOLLOW HERE AS WELL. IN VIEW OF THE DISCUSSIONS ABOVE, WE HAVE UPHELD ASSESSEES CLAIM FOR DEDUCTION UNDER SECTION 80 IB (10) AND THE SAME OBSERVATIONS WILL APPLY MUTATIS MUTANDI HERE AS WELL. ACCORDINGLY, WE UPHOLD ASSESSEES CLAIM OF DEDUCTIO N UNDER SECTION 80 IB (10) IN RESPECT OF BALAJI TOWERS PROJECT AS WELL. T HE IMPUGNED DISALLOWANCE IS DELETED. THE ASSESSEE WILL GET THE RELIEF ACCORDINGLY. 20. THE ASSESSEE THUS SUCCEEDS IN HIS CLAIM FOR DE DUCTION UNDER SECTION 80 IB (10) IN RESPECT OF SILICON TOWERS PROJECT AS WELL. 21. IN THE RESULT, THE APPEAL IS ALLOWED IN THE TER MS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT TODAY ON 30 TH DAY OF MARCH, 2011. SD/XX SD/XX (R V EASWAR ) (PRAMOD KUMAR) HONBLE PRESIDENT ACCOUNTANT MEMBER MUMBAI; 30 TH DAY OF MARCH , 2011 . COPY FORWARDED TO : ITA NO. 6431/MUM/07 ASSESSMENT YEAR: 2004-05 PAGE 17 OF 17 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER MUMBAI CITY , MUMBAI 4. COMMISSIONER (APPEALS) , MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, H BENCH, MUMBAI 6. GUARD FILE TRUE COPY BY ORDER ETC. ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, MUMBAI