M/S.PANTHEON INFRASTRUCTURE PRIVATE LIMITED,MUMBAI V. DCIT CIRCLE-2(1)(1), MUMBAI

ITA 4378/MUM/2018

AI Insights

M/s. Pantheon Infrastructure Pvt. Ltd. appealed against the disallowance of their claim for deduction under section 80IA(4)(iii) of the Income Tax Act, which was initially granted but later withdrawn by the CBDT with retrospective effect. The Tribunal examined the approval process for the assessee's industrial park under the Industrial Park Scheme, 2002, and the subsequent actions by the CBDT and the Ministry of Commerce and Industry. The Tribunal noted that the assessee had maintained the required number of units and complied with the conditions of the scheme, despite changes in the tenants due to mergers and acquisitions. The Tribunal also considered the interim orders of the Bombay High Court and the reports from the CBDT and the Empowered Committee, ultimately deciding in favor of the assessee.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 47183 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Other Referred Cases: Creative Info city Ltd v. Under secretary
• Laws Referred To: Income Tax Act, Industrial Park Scheme, 2002
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R.A. DHYANI
• Assessee Lawyers: VIJAY MEHTA
• Keywords: Opportunity of being heard; Retrospective amendment
• Section: 22; 13; 80IA; 20

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, ‘C’ BENCH MUMBAI BEFORE: SHRI AMIT SHUKLA, JUDICIAL MEMBER & SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER ITA No.4377/Mum/2018 (Assessment Year :2012-13) ITA No.4378/Mum/2018 (Assessment Year :2013-14) & ITA No.823/Mum/2020 (Assessment Year :2014-15) M/s. Pantheon Infrastructure Pvt. Ltd., Logitech Park Mathuradas Vasanji Road Andheri (E) Mumbai- 400 072 Vs. The Deputy Commissioner of Income Tax, Circle 2(1)(1), Mumbai PAN/GIR No.AACCA5266B (Appellant) .. (Respondent) Assessee by Shri Vijay Mehta Revenue by Shri R.A. Dhyani Date of Hearing 10/02/2025 Date of Pronouncement 08/04/2025 आदेश / O R D E R PER AMIT SHUKLA (J.M): The aforesaid appeals have been filed by the assessee against separate impugned order of even date 24/04/2018 ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 2 passed by ld. CIT(A)-4, Mumbai for the quantum of assessment passed u/s.143(3) for the A.Y.s 2012-13, 2013-14 and 2014-15. 2. Since in all these appeals common issues are involved and identical grounds have been raised, therefore, same were heard together and are being disposed of by way of this consolidated order. 3. In all these years the solitary issue involved relates to disallowance of claim of reduction u/s. 80IA(4)(iii). 4. The brief facts and background of the case are that the assessee was engaged in the business of real estate and property development and also developing, operating and maintaining industrial park. In the year 2002 the Department of Industrial Policy and Promotion (DIPP) (under the Ministry of Commerce and Industry, Government of India) vide notification dated 01/04/2002, had notified a scheme for promotion, developing operating and maintaining Industrial Parks which provided incentive of deduction to the eligible undertakings u/s 80-IA(4) (iii) of the Income tax Act. The assessee company, in the year 2004 made an application for obtaining approval for setting up of Industrial Park, Logitech Park, Mathuradas Vasanji Road, Andheri, Mumbai. Subsequently, in March 2005, a revised application was filed for obtaining approval for setting up of the Industrial Park, having an aggregate area of about 1,05,780 sqm. comprising of 14 industrial units in Phase I and Phase II through non-automatic route with the DIPP. The assessee company was ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 3 conveyed approval of DIPP and the Empowered Committee set up under the scheme, vide communication dated 26/07/2006. Subsequently, a corrigendum was issued by the DIPP by the empowered committee on 04-08-2006 as there was some clerical error but the assessee‟s 14 Industrial units were duly approved. Thereafter the assessee, in accordance with Rule 18C (4) of the Income tax rules applied to CBDT for issuance of notification of its industrial park under section 80-IA(4)(iii) of the Income tax Act. Accordingly, the Central Board of Direct Taxes (CBDT) issued a notification dated 17/11/2006. However, the said notification was subsequently withdrawn-in-the year 2014 by the CBDT with retrospective effect from 17/11/2006. The reason and background for withdrawal we will discuss in foregoing paras. 5. For A.Y.2012-13, assessee filed its return of income on 30/09/2012 declaring total income of rs.8,77,71,218/- and book profit of Rs.65,36,09,608/-. In the said return assessee had claimed deduction u/s. 80IA(4)(iii) amounting to Rs.58,02,92,131/-. For the A.Y.2013-14, return of income was filed on 30/09/2013 declaring total income of Rs.12,13,78,920/- and book profit u/s.115JB at Rs.62,25,97,823/-. In this year assessee had claimed deduction u/s.80IA(4)(iii) amounting to Rs.51,76,20,882/-; and in A.Y.2014-15 the return of income was filed on 30/11/2014 declaring total income of Rs.14,75,59,320/- and book profit of Rs.67,62,93,575/-. In this year assessee claimed deduction u/s.80IA(4)(iii) of Rs.54,24,42,001/-. In all ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 4 these years the ld. AO has disallowed the claim of entire deduction u/s.80IA(4)(iii) claimed by the assessee. 6. The ld. AO in his assessment order had observed that the assessee had obtained the approval from the Ministry of Commerce in respect of its Industrial Park and subsequently the same was notified u/s 80-IA(4) (iii) of the Act by CBDT vide notification dated 17/11/2006. However, the said notification has been withdrawn subsequently by the CBDT with a retrospective effect from 17/11/2006. The ld. AO has further observed that the assessee has filed a writ petition before the Hon'ble Bombay High Court challenging the decision of the Ministry of Commerce as well as the notification issued by the CBDT The Hon'ble Bombay High Court has passed an interim order and directed the assessee to take up the matter with CBDT and seek clarification. The ld. AO has further observed that the clarification from the CBDT is awaited The ld. AO thus held that pending CBDT clarification the deduction u/s 80-IA(4)(iii) of the Act cannot be allowed to the assessee. 7. The ld. CIT (A) too has confirmed the said action of the ld. AO holding that argument of the assessee challenging the order of CBDT are not sustainable and same cannot be considered either by the ld. AO or by the ld. CIT (A). 8. Accordingly, the assessee has challenged the disallowance of claim of deduction u/s. 80IA(4)(iii) confirmed in all three years by ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 5 the ld. CIT(A). Apart from that assessee also raised additional ground which reads as under:- “The Ld. CIT(A) has failed to appreciate that the notification issued by the CBDT dated 26.03.2014 rescinding the earlier notification dated 17.11.2006 with retrospective effect from 17.11.2006 is illegal and bad in law. The Ld CIT(A) ought to have appreciated that no cognizance can be taken of such illegal and non-est notification of CBDT.” 9. Before us the ld. Counsel for the assessee Shri Vijay Mehta, narrated the facts and the background of the matter stating that the assessee had made an application for approval of the Industrial Park to the Ministry of Commerce as stipulated under the Industrial Park Scheme, 2002. The said scheme has been notified by virtue of the power granted u/s.80- IA(4)(ii) of the Act read with Rule 18C of Income Tax Rules, 1962. Pursuant to the said application, the Ministry of Commerce and Industry granted the approval to the Industrial Park of the assessee vide its letter dated 26/07/2006. As per the said approval, the assessee was required to have at least 14 units in its Industrial Park (5 units in Phase I and 9 units in Phase II). Subsequently as there was clerical error in the original approval the same was modified by of corrigendum by the Ministry of Commerce and Industry vide its letter dated 04-08-2006. Pursuant to such approval of the Ministry of Commerce, the CBDT notified the Industrial Park of the assessee vide notification dated 17/11/2006. He submitted that the assessee was maintaining the above Industrial Park in compliance with-all-the conditions of approval including having- ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 6 minimum 14 number of units. The assessee company, on realizing that some of the occupants of the units have either undergone merger/amalgamation or assignment of lease right with other occupants, decided to bring fact on record of the Ministry of Commerce and Industry. The assessee felt, although erroneously and incorrectly that due to the aforesaid events total no of occupants understood as units, had gone down from the prescribed minimum number of 14 units. The assessee, therefore, filed an application with the Ministry of Commerce and Industry vide its letter dated 15/12/2011 wherein, the changed situation on account of Amalgamation/Merger and assignment of lease of the units by the occupants was explained in detail. At the same time, the assessee also clarified that there was no change in the total area or the functioning of the existing units. The following paragraph of the aforesaid letter was highlighted before us. \"Sir, we request you please grant us the reduction in the Units from 14 to 6, since the existing units have been taken over, amalgamated or merged with the existing units in the Park without effecting the change in areas. The Area leased stands same, the Park is fully functional and the existing Units in the Park have shown interest in occupying further Area in the Park and hence we will not be in a position to accommodate new tenants. Sir, this situation arised because of the takeover and mergers of the companies among themselves, without change in the existing areas they were occupying The same has happened because of the operation of the law and therefore we have to move this Application for reduction of the units as approved earlier.\" ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 7 15. It would thus be seen that, there was no change in the ground situation and the number of units remained the same. Be that as it may the Ministry of Commerce, acting through Under Secretary rejected the application for the reduction in minimum no. of units vide his letter dated 03-02-2014 (PBP 22) Strangely, while rejecting the application for reduction in units, Under Secretary has observed that Since the undertaking had failed to meet the requirements as per the approval granted under the Scheme, CBDT would be entitled to take action accordingly. 10. Mr. Mehta pointed out that subsequently, the CBDT has completely mis-interpreted the above communication from the Under Secretary, Ministry of Commerce dated 03/02/2014 and revoked the notification dated 17/11/2006 granted-by-it-to the Industrial Park of the assessee company retrospectively The relevant part of the notification dated 26/03/2014, whereby the earlier notification has been withdrawn, reads as under:- “And, whereas, subsequently the Central Government (Ministry of Commerce and Industry) vide letter. no 15/29/2005-IP&ID dated 3rd February, 2014 has withdrawn the said approval granted to the undertaking under the Scheme, Now, therefore, the Central Government, in exercise of the powers conferred by clause (iii) of sub-section (4) of Section 80- IA of the Act read with Section 21 of the General Clauses Act, 1897 (10 of 1897), hereby rescinds the said Notification No. SO.4700, dated 17 November, 2006, with effect from the 17th November 2006.” 11. Thereafter, Shri Vijay Mehta submitted that the CBDT has misunderstood / misinterpreted the said letter written by Under Secretary dated 03/02/2014 as the letter written by the Central Government. The power to grant or withdraw the approval lies ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 8 with the Central Government through the mechanism of empowered committee set up under the scheme and not with the Under Secretary. Thus, this was the misinterpretation done by the CBDT. The CBDT has withdrawn the notification with retrospective effect from 17/11/2006 without any enquiry or verification. Thereafter, the assessee company approached Empowered Committee and raised its objection against the communication of the Under Secretary dated 03/02/2014. The Empowered Committee discussed the whole matter-in-its- meeting held on 11/11/2014 and it has clarified-vide the office memorandum dated 25/11/2014, inter alia that the withdrawal of approval by CBDT w.e.f 17/11/2006 was a little too harsh which needs to be reviewed and undertaking will be eligible for income tax benefits upto the date it adhered to the terms and conditions of approval including the condition of location of at least 14 units. The communication also advised and directed the CBDT to modify the withdrawal notification so that the undertaking may avail income tax benefits till the date it adhered to the terms and condition of the approval-subject to the production of completion certificate by the undertaking. 12. Meanwhile, the assessee company filed writ petition before the Hon'ble Bombay High Court challenging the rejection of amendment request made by the Ministry of Commerce and withdrawal notification of CBDT. It pointed out that the Ld. AO in his assessment order has mentioned that the Hon'ble Bombay High Court vide interim order dated 20/01/2016 granted liberty ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 9 to the assessee to approach CBDT for modification. In the said interim order the Hon‟ble Bombay High Court has also observed as under:- \"The Petitioners have challenged to the CBDT Notification dated 26th March 2014 as being beyond the decision dated 3rd February 2014 of the Central Government Ministry of Commerce and Industry which merely rejected the Petitioners Application for amendment of its approval and had only stated that it may withdraw its approval as an Industrial Park which was granted earlier by Notification dated 17th November 2006. We are prima facie satisfied that the decision dated 3 February 2014 taken by the Central Government Ministry of Commerce and Industry rejects the Petitioners application for amendment to the approval granted on 26th July 2006 and had only threatened withdrawal of the approval granted as Industrial Park. In the above view, the basis of the impugned notices is prima facie not sustainable\" 13. From the above interim order, it is evident that Hon'ble Bombay High Court prima facie opined that the Ministry of Commerce had merely rejected the amendment application and threatened withdrawal of approval. The Hon'ble Bombay High Court has further observed that “in the above view, the basis of impugned notices is prima facie not sustainable”. 14. Thus, in view of the liberty granted by the Hon‟ble Bombay High Court, the assessee approached the CBDT, the CBDT vide letter dated 15/03/2017 observed that the communication of Ministry of commerce dated 03/02/2014 (through under Secretary) was not merely a threat, but observation to withdraw the notification. He submitted that the said response was not only contrary to the observation of the Hon‟ble Bombay High ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 10 Court but also against the spirit of clarification issued by the Empowered Committee came only subsequently and in para 5 of CBDT observed that certain clarifications are awaited from the Field Officers. Thus, effectively the CBDT aligned its own view with that of Empowered Committee and Hon'ble Bombay High Court. The CBDT also proceeded with the exercise of verification of the compliance to the conditions. In other words, CBDT was now open to re-examination of the facts and has effectively given a go-bye to the withdrawal notification. Thereafter, there were series of communication between the assessee and the CBDT and the department starting with March 2017, till date and for more than 7 ½ years there has been no response. Despite in the said communication by the CBDT dated 15/03/2017 has called for the report from the Field Officer. 15. When all these facts were brought on record, we passed an interim order to seek report from the ld. AO vide order sheet dated 31/12/2024. The said interim order is reproduced hereunder:- “In the aforesaid appeals, for all the above A.Ys. 2012-13, 2013-14 & 2014-15, the only issue involved is disallowance of claim of deduction u/s.80IA(4)(iii). The facts which had been culled out on the basis of material placed on record before us are that assessee in its return of income has claiming deduction u/s.80IA(4) on the ground that it has been notified under the Industrial Park Scheme, 2002 and therefore, assessee is entitled for claim of such deduction. The said claim has been disallowed by the ld. AO on the ground that CBDT notification dated 17/11/2006 has been withdrawn subsequently with retrospective effect. ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 11 2. Before us it has been pointed out that, on 26/07/2006, Ministry of Commerce and Industry, Government of India had granted approval for the proposed number of industrial units which was; Phase I- 5 units and Phase II -9 Units. The copy of such approval has been placed before us in the paper book from pages 11-13. Then, again the correction letter was issued by Ministry of Commerce and Industry on 04/08/2006 wherein, there was some correction in the area of Phase-II and Phase II and accordingly, the approval was granted for Phase I of 19,027 sq.mtr and Phase II of 86,753 sq. mtr. In pursuance of the approval granted by Ministry of Commerce and Industry, CBDT issued a notification dated 17/11/2006 notifying all the 14 Units with the area approved under Industrial Park and accordingly, the assessee was entitled for claim of deduction u/s.80IA(4). Later on, assessee wrote a letter to Secretary, Department of Industrial Policy and Promotion (Ministry of Commerce and Industry) urging grant for reduction of number of units from 14 to 6 units, since existing units have been taken over by way of amalgamation or got merged with the existing unit in the Industrial Park without actually affecting the change in the areas. Thus, the assessee‟s request was to change the number of units and not the total area for which it was granted approval and notification by the CBDT. 3. Thereafter, it transpires that on 03/02/2014, Under Secretary to Government of India of Ministry of Commerce and Industry while disposing of this amendment application filed by the assessee dated 15/12/2011 communicated as under:- 1. The said amendment application has since been considered by the Empowered Committee in its meeting held on 08 11.2013, in which an opportunity of being heard was also granted to the representative of the undertaking and it was noted that though occupancy certificate for Phase-I and for ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 12 Phase-Il has been obtained in May 2004 and June 2005 respectively, the completion certificate for the park has not been furnished. 4. It is also noted that the unit has availed IT exemption from 2006, as per the approval granted by the Empowered Committee and the present amendment application merely seeks reduction in the number of units with the intent to avail IT benefits for the remaining period. 5. As per clause 4 of this Department's approval letter dated 05.12 2006 and clause 11 of the Notification dated 09.02.2007 of the CBDT, the conditions mentioned in the approval and those mentioned in the Industrial Park Scheme, 2002 are to be adhered to hiring the period when benefits under this scheme are to be availed and in case of failure to comply with any of these conditions, the Government may withdraw the approval. 6. Since the undertaking bad failed to meet the requirement as per the approval granted under the scheme, CBDT would be entitled to take action accordingly. The request made by the undertaking vide its amendment application dated 15/12/2011 is hereby rejected. 4. Post this letter of Under Secretary (Ministry of Commerce and Industry), CBDT has withdrawn the notification granted earlier vide notification dated 26/03/2014 on the presumption that Ministry of Commerce and Industry has withdrawn the approval. The copy of notification of CBDT withdrawing the said notification has been placed in the paper book at page 25, wherein, it has been stated that now the Central Government in exercise of powers conferred u/s.80IA(4)(iii) hereby rescinds the said notification dated 17/11/2006 with retrospective effect from the same date. It was because of the withdrawal of this notification, the ld. AO as well as the ld. CIT(A) have ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 13 disallowed the claim of deduction u/s.80IA(4) claimed by the assessee. 5. It has been submitted by the ld. Counsel before us that firstly, once the approval has been granted, then, Under Secretary to the Government of India cannot withdraw the approval as it has to be done only by „Empowered Committee‟ of Ministry of Commerce and Industry. The assessee thereafter did approach and made representation to the Empowered Committee and in pursuance of that, the Empowered Committee, Ministry of Commerce and Industry vide Office Memorandum dated 25/11/2014 have clarified this issue in the following manner:- “(iv) The EC was informed that vide notification dated 26.03.2014, the CBDT had rescinded notification no. SO4700, dated 17.11.2006, w.e.f 17.11.2006 thereby denying the undertaking benefits under Income Tax Act 1961 from the very beginning. (v). DIPP was of the view that withdrawal of approval by CBDT w.e.f 17.11.2006 was a little too harsh which needs to be reviewed. The undertaking should be eligible for income tax benefits upto the date the undertaking adhered to the terms and conditions of approval including the condition of location of at least 14 units in its industrial park. (vi). CBDT informed the EC that the terms of approval / conditions of the notification were never met by the undertaking. Hence, CBDT rescinded notification No. 4700 dated 17.11.2006. Decision:- Notification dated 26.03.2014 is to be modified by CBDT such that the undertaking may avail income tax benefits till the date it adhered to the terms and conditions of ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 14 approval, subject to production of completion certificate by the undertaking.” 6. Thus, the Empowered Committee clarified the earlier communication by the Under Secretary that the undertaking should be eligible for income tax benefits upto the date the undertaking adhered to the terms and conditions of approval including the condition of location of at least 14 units in its industrial park. Further, it directed the CBDT to modify the Notification dated 26.03.2014 that the undertaking may avail income tax benefits till the date it adhered to the terms and conditions of approval, subject to production of completion certificate by the undertaking, which it has been informed to us has been completed and all the formalities stands fulfilled. 7. In the meantime, the assessee had filed Writ petition before the Hon‟ble High Court against the Ministry of Commerce and Industry and Others. The Hon‟ble High Court vide its judgment and order dated 20/01/2016 had clarified this issue in the following manner:- “2. This Petition under Article 226 of the Constitution of India inter alia challenges the Notification dated 26th March 2014 issued by the Central Board of Direct Taxes withdrawing its Notification dated 17th November 2006 granting the Petitioners' benefit of Section 80-IA of the Income Tax Act 1961 (the Act). The Petitioners also challenge the consequent five reopening notices dated 28th March 2014 seeking to reopen assessment for AYs 2007-08 and 2011-12. The reason recorded for issuing the impugned reopening notices is the CBDT Notification dated 26th March 2014. The Petitioners have challenged to the CBDT Notification dated 26th March 2014 as being beyond the decision dated 3rd February 2014 of the Central Government Ministry of Commerce and Industry which merely rejected the Petitioners' Application for amendment of its approval and had ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 15 only stated that it may withdraw its approval as an Industrial Park which was granted earlier by Notification dated 17th November 2006. We are prima facie satisfied that the decision dated 3rd February 2014 taken by the Central Government Ministry of Commerce and Industry rejects the Petitioners' application for amendment to the approval granted on 26th July 2006 and had only threatened withdrawal of the approval granted as Industrial Park. In the above view, the basis of the impugned notices is prima facie not sustainable. Therefore, pending disposal of this Petition, five impugned notices dated 28th March 2014 seeking to reopen the assessment of AYs 1997-98 to 2011-12 be stayed pending the final disposal of this Petition. Needless to state that the assessment and appellate proceedings for the subsequent assessment years are not in manner fettered by these proceedings though the same may be subject to final result of this Petition. The Petitioners are given liberty to approach the CBDT with a representation to modify / withdraw the Notification dated 26th March 2014.” 8. Thus, the Hon‟ble High Court have clarified that, firstly, the decision taken by the Central Government, Ministry of Commerce and Industry on 03/02/2015 and the application filed by the assessee for the amendment to the approval had only threatened the withdrawal of the approval granted to the Industrial Park; and secondly, assessment and appellate proceedings in the subsequent assessment years will not be fettered by these proceedings and the liberty was given to the assessee to approach CBDT with a representation to modify / withdraw the notification dated 26/03/2014 i.e. notification by CBDT as rescinding earlier notification. ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 16 9. Thereafter, assessee again approached CBDT, and CBDT vide letter dated 15/03/2017 took cognizance of this fact that Empowered Committee had decided that notification dated 26/03/2014 is to be modified by the CBDT and it further mentioned that certain clarifications are awaited which has been called from the field formation. The copy of said letter had been placed in the paper book at page 92. It has been informed that, since 2017 to till date, neither there is any notification issued by the CBDT nor there any communication despite so many representation and reminders (as had been informed to us by the ld. Counsel of the assessee). Admittedly there has been no response by the CBDT. As a result of this inaction by the CBDT, the assessee which otherwise was entitled for claim of deduction u/s. 80IA (4) has continuously been denied for such deduction and assessee is forced to litigation from year to year. 10. One of the main contentions which have been raised before us on behalf of the assessee is that, CBDT has no power to withdraw the approval. As per the „Industrial Park Scheme 2002‟ under which the approval was granted to the Industrial Park of the assessee by the Central Government through Empowered Committee of Ministry of Commerce and Industry, then the power to withdraw the approval only lies with the Central Government and not CBDT. The role of CBDT under Rule 18(C)(4) of the Income Tax Rules is to notify the Industrial Park upon the approval given by the Central Government. Once the approval has been granted by the Central Government through Ministry of Commerce and Industry and even the modification to the approval has been done by the Empowered Committee, then CBDT has no role except to issue the notification. In support of this contention, reliance has been placed on the decision of the Hon’ble Gujarat High Court in the case of Creative Info city Ltd v. Under secretary, in Special civil Application no. 9247 of ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 17 2011. Thus, it has been stated that CBDT could not have on its own motion withdraw its notification. Once the communication of Ministry of Commerce and Industry dated 03/02/2014 which had been relied upon by the CBDT for withdrawal of notification has been clarified by the Empowered Committee Ministry of Commerce as well as by the Hon‟ble Bombay High Court, then the earlier notification issued by the CBDT rescinding the notification has no legs to stand nor does it can said to be operative. We are in complete agreement with such contention of the ld. Counsel as here in this case as noted above, the Empowered Committee (Ministry of Commerce and Industry) has clarified that the approval granted to the assessee still continues and the withdrawal of the approval by the CBDT needs to be reviewed. Before us various other propositions has been made before us that the CBDT has no power to withdraw the notification retrospectively, however, at this stage we are not going into this issue. 11. Looking to the fact that already several years have lapsed either because of procrastination attitude by the CBDT or the lackadaisical approach of the Revenue authorities, the jeopardy and injustice to the assessee persists and is perpetuated year after year, whereby, on one hand the ld. AO is continuing to disallow the claim of deduction which assessee is otherwise entitled to; and on the other hand there is no response despite several representations have been made and yet there is no clarification by the CBDT leading to disallow of claim. It has been brought on record that assessee has undertaken several correspondences with the CBDT and the ld. AO since year 2017 and inspite of the fact that both Empowered Committee as well as Hon‟ble Bombay High Court have opined that earlier communication of Ministry of Commerce and Industry was not revocation of approval which fact has already been accepted by the CBDT in its letter dated ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 18 15/03/2017, still now after lapse of seven years there has been no response. It has also been informed that assessee has filed the RTI application wherein the following information was sought: “a. Whether, while issuing the notification dtd 26.03.14, the CBDT had considered the communication issued by the DIPP dtd 03.02.14 as the recommendation of EC to withdraw the earlier approval dtd 17.11.06? b. If yes, whether the said view was found to be incorrect subsequently when the office memo dtd 25.11.14 was received by the CBDT? c. Whether the AO, while completing the assessment, for each of the AY, has power to examine the compliance made by Pantheon to the condition of no. of unit and other conditions prescribed in the approval dtd 26.07.06? d. What are the specific reasons for not taking any decision on the petitions made before CBDT by Pantheon dtd 11.03.16 and 10.02.17 and subsequent correspondence to jurisdictional tax authorities?\" However, there has been no final response on such RTI application dated 20/09/2024. 12. In view of the aforesaid facts and circumstances and looking to the imperilment caused to the assessee on year to year basis, we direct the Jurisdictional AO to verify the number of units and area for which assessee was granted approval and if assessee is found to have complied with the minimum number of units requirement, i.e., 14 units in the Industrial Park (which was earlier notified by the CBDT); and if such conditions are fulfilled, then this Bench will decide the ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 19 issue of deduction u/s. 80IA (4) sans any clarification or re- issue of notification by the CBDT, because the rescinding of earlier notification does not stand once the Central Government through Empowered Committee has clarified that assessee still hold the approval for all the 14 Units and area in the Industrial Park. Before us, the assessee has enclosed the list of occupants for all the three years of various units, which ld. JAO is directed to verify and report before us. The reason for seeking the report is that, firstly, assessee still continues to enjoy the approval of Ministry of Commerce and Industry and CBDT had also acknowledged it vide letter dated 15/03/2017, but yet no action has been taken or amended notification has been issued; and secondly, several years have lapsed whereby assessee continues to be taxed by way of disallowance of deduction u/s. 80IA (4). Ld. JAO is directed to submit his report within one month from the date of receipt of this communication / interim order. Assessee is also directed to cooperate with the Ld. AO to submit all the necessary documents. 13. List this case for hearing on 10/02/2025. The matter shall be listed as part heard. 16. The aforesaid interim order had captured all these facts which had been narrated by the ld. Counsel before us and the entire sequence of events including the order of the Hon‟ble Bombay High Court dated 20/01/2016 in various communications and had sought for the report from the ld. AO. 17. In pursuance of the aforesaid direction and interim order, the ld. AO has submitted his exhaustive report vide letter dated 06/02/2025. The salient features emerging from the ld. AO ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 20 report includes letter dated 13/05/2022 and 04/08/2022 wherein following facts have been given after proper enquiry. a) It captures the chronology of events and factual background of application submitted by the assessee company for approval of industrial Park under IPS-2002, grant of approval by the Central Government, and subsequent rejection of modification application and withdrawal of notification dated 17-11-2006 and connected facts. b) That the assessee has furnished various details and required information for verification to the Ld. Assessing Officer vide letters dated 28-02-2022, 11-03-2022, 20-04-2022 and 25-04- 2022, etc. c) That the communication vide letter dated 04-08-2022 states that CBDT vide letter dated 15-03-2017 had raised following three points for verification by the assessing officer i) Date of Merger/ Amalgamation ii) Duration up to which the undertaking adhered the terms and conditions iii) Completion Certificate d) That the erstwhile Assessing Officer called for various details from the assessee including detailed floor plan of the Industrial Park, layout of the building, photographs of the entire structure and the units for necessary verification. ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 21 e) That the Assessing Officer, based on the information/details collected and verification-conducted, submitted a point-wise reply to the queries 18. The ld. AO‟s report of each of the points can be summarized in the following manner:- I. Actual date of completion in terms of IPS-2002 and the completion certificate: - The Assessing Officer takes note of the submission made by the assessee that there was no requirement to submit completion certificate under the provisions of IPS-2002 He also notes the submission of the assessee that there was a distinction between the terms \"unit\" and \"Occupant. The Assessing Officer in the report states that Industrial Park, approved under IPS-2002, will be continued to be governed by the scheme of 2002 and not by IPS-2008 The Assessing Officer in the report concludes that the contention of the assessee that the requirement for completion certificate was not applicable in the case of the assessee appears to be correct. He then added that the petitioner has in fact submitted Occupation Certificate (OC) issued by the Brihanmumbai Municipal Mahanagarpalika and also the completion certificate issued by the Architect, which evidence that not only the construction of the Park was completed but the same was ready to be occupied II. Number of units constructed at the time of completion of the Park The Assessing Officer in the report dated 04-08-2022 has referred to and relied upon earlier report of 13-05-2022 containing 78 pages. The Assessing Officer at page 77 of the report concluded as under ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 22 As per the evidence in the form of building layout, occupation certificates, architect completion certificates, photographs submitted it is seen that the total area approved as per DIPP approval and constructed appears to be the same. The details of which are as under: a) Area and Number of Units to be constructed as per DIPP approval dated 26-07-2006 (amended vide letter dated 04-08- 2006) Phase 1-5 units- Area of 19,027 Sq. mtrs. Phase II-9 units Area of 86,753 sq. mtrs. b) Actual Units Constructed by the Assessee (as per photographs/building layout submitted by the assessee) Phase 1-5 units-Area of 19,027 Sq. mtrs. Phase II- 14 units-Area of 86,753 sq. mtrs. c) Units Constructed and existing as on date (as per photographs/building layout submitted by the assessee) Phase 1-5 units-Area of 19,027 Sq. mtrs. Phase II-14 units-Area of 86,753 sq. mtrs\" It is noted that the report of the Assessing Officer is clear and unambiguous that there were 19 units in all in the beginning and the same units continue to exist as on the date III. Reduction in the units/area constructed ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 23 IV. Whether the reduction in the number of the units as claimed by the applicant is artificial or there existed 14 units in the beginning which were subsequently reduced to 6 The issues at III and IV are related and connected. On perusal of details of the construction of units and the area given above it is clear that there is no reduction in the total area or the number of the premises or units. On this issue Assessing Officer refers to report dated 13-05-2022 and elaborate the same in continuation. The Assessing Officer has taken note of the terms \"unit\" and \"tenants or occupants\". The Assessing Officer further notes that the requirement of an industrial unit to have separate and distinct entity which is assessable to tax under the Act having separate PAN was introduced in the Industrial Park Scheme- 2008 He further states that this requirement was not there in IPS-2002. The Assessing Officer in the report has opined that IPS-2008 was not applicable. It will be pertinent to reproduce the last two paragraphs of Assessing Officer's Report dated 04-08- 2022, which are as under \"It is seen from the facts that there was some confusion between 'numbers of tenants and number of units While the Units constructed remained constant, it is the tenant entities who got reduced due to merger/amalgamation and not the units which were constructed in 2004 and 2005. There is no reduction in the number of units or areas originally constructed by the Petitioner both during pre-merger/ amalgamation and post-merger/ amalgamation periods. Further, the requirement of an industrial unit to have a separate and distinct entity which is assessable to tax under the provisions of the Act having a separate Permanent Account Number (PAN) was the requirement of IPS 2008 which is riot applicable to the Petitioner ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 24 In this regard, it is worthwhile to note that apparently, the Petitioner has mixed the terms \"units with \"tenants\" It has originally constructed 19 (5+14) physical premises (ie units), for leasing out to 14 tenants Further, while the number of units constructed remained same since commencement of the industrial park, even when the Petitioner filed its amended application to the DIPP in December 2011, it is only the tenants, who got reduced due to the take-over/amalgamation/merger* The report indicates that the number of units or premises has remained unchanged since the beginning. There was no change in the total area of the Industrial Park or the Units. Thus it is clear that the assessee has originally constructed 19 (5+14) units or physical premises in the two phases of development of Industrial Park. That the number of units constructed remained the same even when the assessee filed its amended application to the DIPP in December 2011. It was only the number of tenants which got reduced due to the take-over / amalgamation / merger of the entities.” 19. Thus, this factual report by the ld. AO now makes it very clear-  Firstly, number of units in the premises has remained unchanged since the beginning;  Secondly, there was no change in the total area of the industrial park for the units which was the basis of the communication by the under Secretary dated 03/02/2014 based on which CBDT has withdrawn the notification with retrospective effect. Later on, once the empowered committee had again clarified this issue, the CBDT had called for the report from the Field ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 25 Officer to verity the same very aspects. Now that ld. AO had already submitted report with the higher authorities which now clarifies that there is nothing adverse against the assessee. Ergo, in view of this factual report by the ld. AO which has been done after conducting proper enquiry and that already Empowered Committee had clarified this issue that assessee undertaking may avail the income tax benefit till the date it adheres the terms and conditions granted earlier. It is also not in dispute that completion certificate of undertaking was already submitted and all the conditions have been found to be satisfactory, therefore, now there cannot be any dispute that assessee is eligible for claim of deduction u/s.80IA(4)(iii). 20. The ld. DR submitted that now that the report has been submitted by the ld. AO clarifying the position, the matter should be restored back to the ld. AO and in light of these reports, and CBDT will issue the notification and assessee can get a consequential relief. 21. On the other hand, ld. Counsel objected that already so many years have lapsed and despite several communications, the CBDT has given no response nor any notification has been issued. 22. Here in this case, as noted above already CBDT has issued a notification vide notification dated 17/11/2006 in pursuance of approval from the empowered committee, Ministry of Commerce. Once these facts were made clear, subsequently by the ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 26 Empowered Committee and even CBDT has acknowledged vide its communication dated 15/03/2017 and only the report from the Field Officer was awaited, then there remains no hurdle in granting benefit of deduction u/s 80IA(4)(iii) of the Act. Since 2017, till date almost eight years have lapsed and no notification issued. Now the question is whether in absence of any notification can deduction be granted u/s. 80IA(4)(iii). In our view, once earlier notification was issued by CBDT, same cannot revoked / withdraw the notification with retrospective effect, because the withdrawal was on 03/02/2014. There is no provision which has been brought to our notice or shown that CBDT has power to withdraw the notification retrospectively. It is a well settled law that the executive orders / circulars in absence of any legislative competence cannot be made applicable with retrospective effect. This proposition has been upheld by the Hon‟ble Supreme Court in the case of Bharat Sanchar Nigam Ltd. vs. Tata Communication Ltd. reported in (2022 SCC online SC 1280). For the sake of ready reference, the relevant observation and the principle laid down by the Hon‟ble Supreme Court is as under:- “29. It is a settled principle of law that it is the Union Parliament and State Legislatures that have plenary powers of legislation within the fields assigned to them, and subject to certain constitutional and judicially recognized restrictions, they can legislate prospectively as well as retrospectively. Competence to make a law for a past period on a subject depends upon present competence to legislate on that subject. By a retrospective legislation, the Legislature may make a law which is operative for a limited period prior to the date of its ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 27 coming into force and is not operative either on that date or in future. 30. The power to make retrospective legislations enables the Legislature to obliterate an amending Act completely and restore the law as it existed before the amending Act, but at the same time, administrative/executive orders or circulars, as the case may be, in the absence of any legislative competence cannot be made applicable with retrospective effect. Only law could be made retrospectively if it was expressly provided by the Legislature in the Statute. Keeping in mind the afore-stated principles of law on the subject, we are of the view that applicability of the circular dated 12th June, 2012 to be effective retrospectively from 1 April 2009, in revising the infrastructure charges, is not legally sustainable and to this extent, we are, in agreement with the view expressed by the Tribunal under the impugned judgment.” 23. Another important proposition is that as per the Industrial Park Scheme 2002 under which the approval has been granted to the industrial park of the assessee, the approval has to be granted only by the Central Government from the Empowered Committee and the power to withdraw the approval is also granted by the Central Government. The only limited role given to the CBDT under Rule 18C (4) of the Income Tax Rule, 1962 is to notify the industrial park upon approval given by the Central Government. Now here in this case Central Government Empowered Committee has already given approval and even the modification to the approval has been done by the Empowered Committee. Thus, the issue of notification by the CBDT is merely a ministerial Act. This principle has been laid down by the ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 28 Hon‟ble Gujarat High Court in the case of Creative Infocity Ltd., vs Under Secretary on the Special Civil Application No. 9247 of 2011, wherein the Hon‟ble Gujarat High Court had observed and held as under:- “4. According to learned counsel for the petitioner, the Central Board of Direct Taxes has no authority in delaying the grant of benefits under Section 80-IA of the Act of the industrial park to the petitioner by starting a second line of inquiry in spite of approval granted by the Commerce Ministry. In other words, according to the petitioner, the Board ought to have notified the industrial park on getting a copy of approval letter dated June 21, 2001 of the Commerce Ministry, which is annexed to the writ-application as Annexure: A. 5. In order to appreciate the aforesaid question, it will be profitable to refer to the provision contained in Rule 18C of the Income Tax Rules, 1962 which is quoted below: \"18C: Eligibility of Industrial Parks and Special Economic Zones for benefits under section 80-IA [iii]:- [1] The undertaking shall begin to operate an industrial park during the period beginning on the 1st day of April, 1997, and ending on the 31st day of March, 2002. [1A] The undertaking shall begin to develop or develop and operate or maintain and operate a special economic zone any time during the period beginning on the 1st day of April, 2001 and ending on 31st day of March, 2006. [2] The undertaking shall be duly approved by the Ministry of Commerce and Industry in the Central Government under the scheme for industrial park or Special Economic Zones notified by that Ministry. [3] The undertaking shall continue to fulfill the conditions envisaged in the scheme. [4] On approval under sub-rule [2], the Central Board of Direct Taxes, shall notify industrial parks for benefits under section 80- IA.\" ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 29 6. A plain reading of the aforesaid provision makes it clear that the undertaking of the assessee should be at first duly approved by the Commerce Ministry under the Scheme of Industrial Parks or Special Economic Zones notified by the Ministry as provided in sub-rule [2]. Once such approval under sub-rule [2] is given, it is the duty of the Board to notify the industrial park for the benefits under Section 80-IA of the Act. Sub-rule [3], however, makes it mandatory that an undertaking should continue to fulfill the conditions envisaged in the Scheme. 7. Therefore, we find substance in the contention of Mr. Shah, the learned counsel appearing on behalf of the petitioner, that once approval is given by the Commerce Ministry to the petitioner in terms of sub-rule [2] of Rule 18C, the Board is duty bound to notify the industrial parks for benefits under Section 80-IA without any further investigation as to whether the petitioner has complied with the terms and conditions envisaged in the scheme. Since the power of grant of approval has been conferred upon the Commerce Ministry, in the absence of any express provision in the Rules, it should be presumed that the authority, which has given approval, has the power of revocation and examination of compliance of the conditions upon which the approval has been accorded. Therefore, it is the duty of the Commerce Ministry to decide whether an industrial undertaking is complying with the conditions envisaged in the scheme and if the undertaking fails to comply with those conditions, it is the Commerce Ministry alone, which has the right to withdraw the benefit granted under sub-rule [2] of Rule 18C of the Rules. As soon as the approval under sub-rule [2] of Rule 18C is given, it is obligatory on the part of the Central Board of Direct Taxes to notify industrial parks in terms of sub-rule [4] of Rule 18C. 8. In the case before us, there is no dispute that till today, the Commerce Ministry has not revoked the approval given in terms of sub-rule [2] of Rule 18C and thus, it is the duty of the Board to notify the industrial parks for the benefits under Section 80-IA of the Act.” 24. Thus, the CBDT could not have on its own motion withdrawn the notification and even otherwise also the ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 30 communication of Ministry of Commerce dated 03/02/2014 which was relied upon by the CBDT for withdrawing the notification has been subsequently clarified by the Ministry of Commerce itself as well as by the Hon‟ble Bombay High Court, thus, there means no reason for withdrawal of notification. 25. In so far as the contention of the ld. DR that matter should be restored back to the file of the ld. AO, we are unable to accept his request for the reason that already more than 8 years have lapsed and despite so many communications by the assessee, there is no response from the CBDT and further, already the report of the Field Officer / ld. AO is there on the record accepting the fact that all the conditions stands fulfilled therefore, we direct the ld. AO to allow the claim of deduction u/s.80IA(4) for the aforesaid assessment years appealed before us. Consequently, claim of deduction u/s.80IA(4)(iii) as claimed by the assessee is allowed. Accordingly, appeal of the assessee is allowed. 26. In the result, all the appeals of the assessee are allowed. Order pronounced on 8th April, 2025. Sd/- (GIRISH AGRAWAL) Sd/- (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated 08/04/2025 KARUNA, sr.ps ITA No. 4377/Mum/2018 and others M/s. Pantheon Infrastructure Pvt. Ltd. 31 Copy of the Order forwarded to : BY ORDER, (Asstt. Registrar) ITAT, Mumbai 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// "