Law:

Section:

I. Section 80-IB of the Income-tax Act, 1961 - Deductions - Profits and gains from industrial undertakings other than infrastructure development undertakings - Assessment year 2004-05 - Deduction allowed under section 80-IB could not be withdrawn on basis of amendment to section 80-IB introduced subsequently with prospective effect [In favour of assessee] The Assessing Officer sought to reopen assessment for relevant assessment year to withdraw deduction allowed under section 80-IB on the premise that in the housing project developed by the assessee there were commercial establishments occupying 7.96 per cent of the constructed area while as per clause (d) of section 80-IB(10), the limit was 5 per cent of the aggregate built up area or 2000 sq. ft., whichever was less and, therefore, the assessee was wrongly allowed such deduction. On writ: Held that admittedly, clause (d) of section 80-IB(10) disqualifying the assessee from claiming benefits under section 80-IB(10) was introduced subsequently. Admittedly, such amendment is not made with retrospective effect. In that view of the matter, there was no scope for reopening the assessment already closed. In the result, the impugned notice for reopening was quashed. II. Section 147 of the Income-tax Act, 1961 - Income escaping assessment - General - Assessment year 2004-05 - A closed assessment cannot be reopened on basis of an amendment introduced subsequently [In favour of assessee] The Assessing Officer sought to reopen assessment for relevant assessment year to withdraw deduction allowed under section 80-IB on the premise that in the housing project developed by the assessee there were commercial establishments occupying 7.96 per cent of the constructed area while as per clause (d) of section 80-IB(10), the limit was 5 per cent of the aggregate built up area or 2000 sq. ft., whichever was less and, therefore, the assessee was wrongly allowed such deduction. Held that admittedly, clause (d) of section 80-IB(10) disqualifying the assessee from claiming benefits under section 80-IB(10) was introduced subsequently. Admittedly, such amendment is not made with retrospective effect. In that view of the matter, there was…

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