DY. COMMISSIONER OF INCOME TAX, MUMBAI vs. BOMBAY SLUM REDEVELOPMENT CORPORATION PRIVATE LIMITED, MUMBAI

PER OM PRAKASH KANT, AM

This appeal by the Revenue is directed against order dated
05.07.2025 passed by the Ld. Commissioner of Income-tax
(Appeals) – 52, Mumbai [in short ‘the Ld. CIT(A)’], raising the sole ground is reproduced as under:
Whether on the facts and in the circumstances of the case, the Ld.
CIT A is justified in not sustaining the disallowance made u s 801B
10 d of the Act amounting to Rs. 17,32,03,590 despite the fact that the Departme
Hon ble Supr the issue is s
2. Briefly stated, t real estate business, the Income-tax Act, total income at ₹8,0
reopened under sec compliance during re vide order dated 12. section 147, disallow under section 80IB a 3. On appeal, the reopening was based deduction under sect pending consideratio case of M/s Sonasha elaborate examinatio
(i) The issue had a by the Coord
Enterprises;
(ii) The said decisio
Court, which he
Bomba
ITA ent has filed a Special Leave Petition S reme Court which is pending for adjudica sub judice he assessee, a limited company was originally assessed under s
1961 (“the Act”) on 30.12.20
03,24,790/-. Thereafter, the a ction 147 of the Act. Owing t eassessment proceedings, the As .02.2022 passed under section wed the deduction claimed b amounting to ₹17,32,03,590/-.
Ld. CIT(A) allowed the assess d solely on the premise that th tion 80IB(10) in respect of sale on before the Hon’ble Suprem a Enterprises (supra). The Ld.
n of the judicial record, noted th already been decided in favour inate Bench of the Tribuna on stood affirmed by the Hon’bl eld that no substantial question ay Slum Redevelopment
Corporation Pvt. Ltd.
2
A No. 6126/MUM/2025
SLP before the ation and thus y engaged in the section 143(3) of 16, determining assessment was to alleged non- ssessing Officer, n 144 read with by the assessee see’s claim. The e allowability of of FSI/TDR was me Court in the CIT(A), after an hat:
of the assessee al in Sonasha le Bombay High of law arose;

(iii) The deduction merely because
Hon’ble Suprem
3.1 The Ld. CIT(A)
Tribunal, including A deduction under sec
FSI/TDR received in projects had been up deleted.
3.2 The relevant fin
“6. I have con by the appe section 143(3
8,03,24,790/
147 and noti the appellant section 801B
The case was fact that the case of M/s S
Court in SLP reached fina appellant requ completed an Officer. Aggrie appeat before as under:
7. With resp against the 80IB(10) of th of the Act rely
M/s Sonasha
Supreme Cou
Bomba
ITA under section 80IB(10) could e an SLP was stated to be pen me Court.
further relied upon consistent
Aarti Projects and Constructions ction 80IB(10) on profits arisin n lieu of development of slum pheld. On this reasoning, the di ding of ld CIT(A) is reproduced a nsidered the facts of the case and the d llant. In this case, assessment was c
3) on 30.12.2016 with an assessed
-. Subsequently, the case was reopene ice u/s 148 was issued on 30.06.2021
t had claimed a deduction of Rs. 17,32
on the income from the sale of FSI (Flo s re-opened by the Assessing Officer on allowability of deduction u/s 801B on Sonasha Enterprises is pending before H
P vide D.N 11467/2015, however, the ality. Thus, the deduction u/s 801B uired to be disallowed. Accordingly, the nd Rs. 17,32,03,590/- was disallowed b eved by the order of Assessing Officer, th e the undersigned with various grounds pect to Ground No.4, the appellant has disallowance of deduction of Rs. 17,3
he Act. The AO has made disallowance u ying on the fact that identical issue is inv a Enterprises and the same is pending urt in SLP vide D.N 11467/2015. In th ay Slum Redevelopment
Corporation Pvt. Ltd.
3
A No. 6126/MUM/2025
not be denied nding before the decisions of the (supra), wherein ng from sale of m rehabilitation isallowance was as under:
details submitted completed under income of Rs.
ed under section mentioning that 2,03,590/- under oor Space Index).
the basis of the this issue in the Hon'ble Supreme matter has not claimed by the assessment was by the Assessing he appellant filed which are dealt s raised appeal
32,03,590/- u/s u/s u/s 80IB(10) volved in case of g before Hon'ble his regard, it is worthwhile to Sonasha En
4912/Mum/2
revenue has vide its prono relevant portio
These appeal both dated 22
respectively.
2 The revenu appeals:
1. On the fa
CIT(A) erred in Act. 1961 ma rejected the cl i) that the bui of tenements housing proj
801B(10)(d) of ii) that the as the assessee provisions of the housing p
2) On the fact erred in app substantiated documentary
3. The asses developer. Th scheme as se
80IB(10) for th the claim of th is having com
5% as provid assessee is a Development of the section remand orde
Assessing Of impugned ord
Bomba
ITA o mention here that the Hon'ble ITAT in nterprises (relied by the AO) vide I
2010 for A.Y 2007-08 & 2008-09 dated filed appeal before Honb'le ITAT. Furth ouncement has rejected the contention of on of the decision of Hon'ble ITAT is furni ls by the revenue are directed against
2.3.2010 of the CIT(A) for the AYs 2007- ue has raised the following common g cts and circumstances of the case and n allowing the claim of deduction u/s. 80
ade by the assessee even though the A laim of such deduction on the grounds:
ild up area of the 68 shops included in the s exceeded 5% of the aggregate built- ject.
thereby contravening the prov f the Act.
ssessee was a contractor and not a bui has sold TDR and the same being mo
Sec 801B (10) of the Act did not apply be projects only.
ts and circumstances of the case and in l preciating that the assessee has no d the payment to the above pers evidence.
ssee is a firm engaging in the business he assessee has developed the housing p ectioned by MMRDA. The assessee claime he AYs under consideration. The Assessin he assessee mainly on two grounds viz th mmercial establishment in the project wh ded under clause (d) of sec. 80IB(10) an a contractor and not a builder who has Right (TDR) which is a moveable asset an n does not apply. 3.1 On appeal, the er and after considering the remand
Officer, allowed the claim of the ass der.
ay Slum Redevelopment
Corporation Pvt. Ltd.
4
A No. 6126/MUM/2025
the case of M/s
ITA No.4911 &
31.10.2011, the her, the Tribunal the revenue. The ished as under:
separate orders
-08 and 2008-09
grounds in these d in law, the Id.
01B(10) of the I.T.
Assessing Officer e housing project
-up area of the visions of Sec.
lder and iii) that ovable asset, the eing applicable lo law, the id CIT(A) ot justified and sons with any s of builder and roject under SRA ed deduction u/s ng Officer denied hat the assessee hich is more than nd secondly, the sold Transfer of nd the provisions
CIT(A) issued a d report of the sessee vide the 4. Before us, under the SR
80IB(10) the India. He ha record to sho
India. He ha against the MMRDA and development deduction u/s assessee has exceeds the p project excee therefore, the contended th therefore, the has relied upo
4.1. On the o the housing
31.3.2005 an provisions of applicable, as further subm
Commissione
289 has uphe amendment b not retrospect sold out the c were built as which the as has received
Therefore, the TDR, which w is entitled for 5. We have c material on re scheme was n has not been assessment o the assessee clause (a) or when the ass question of t
Bomba
ITA the Id DR has submitted that the assess
RA scheme and therefore, as per the firs scheme of SRA shall be notified by the as submitted that the assessee has no w that the said scheme has been notifie as further submitted that the assesse development of the project under con the income of the assessee is not d of the project but by sale of TDR, which i s 80IB(10) of the Act. He has further su s constructed 68 shops in the housin prescribed limit of 5%. Even the comme eds 10% of the total constructed aree assessee is not entitled to the deduction at the housing project was sanctioned e amended provisions of sec. 80IB(10) i on the order of the Assessing Officer.
ther hand, the Id AR of the assessee ha project was approved on 11.5.2004 w nd therefore, the same is governed by f sec. 80IB(10) and clause (d) of sec s the project was approved prior to 1. mitted that the Hon'ble High Court, r of Income-tax v. Brahma Associates rep eld the order of the Tribunal on the poin by which the clause (d) of sec. 80IB(10) tive. He has further submitted that the a commercial establishments in the project a s per the instructions and requirement sessee did not receive any consideratio
TDR only in respect of the residential pa e consideration received by the assesse was sold by the assessee and according deduction u/s 8018(1).
considered the rival contention and peru ecord. The first objection raised by the Id not notified by CBDT, it has to be seen th raised by the Assessing Officer either w order or during the remand report. Furth e never sought any relaxation in the c
(b) of sec. 80IB(10) by virtue of first p sessee has not claimed any benefit under the scheme of SRA, as notified or not, ay Slum Redevelopment
Corporation Pvt. Ltd.
5
A No. 6126/MUM/2025
see has sold TDR st proviso to sec.
e Government of ot furnished any ed by the Govt of ee received TDR nsideration from directly from the is not entitled for ubmitted that the ng project which rcial area in the e of the project; n. He has further after 31.3.2005; is applicable. He as submitted that which is prior to the un-amended c. 801 B is not 4.2005. He has in the case of ported in 333 ITR nt of prospective
) is inserted and assessee has not and all the shops t of MMRDA for on. The assessee art of the project.
ee in the form of gly, the assessee used the relevant
DR that the SRA hat this objection while passing the her, we note that conditions under proviso therefore, r the proviso, the does not arise.

Accordingly, w
DR.
5.1 As regar establishmen
Officer has a agreement dt sec. 80IB(10) juri ictional no bar of com deduction u/
1.4.2005. The "In the abse
Tribunal was deduction un approved by commercial us
Therefore, wh is no bar for has been app
5.2 As regard not a builder of housing pro the fact that t the developm
TDR was rec and not for received by consideration there is no ot other than the 5.3 It is not t after apprecia be treated as has given the the same ye
Therefore, the sale considera case, we do
CIT(A) for bo revenue are d
7.1 Further, a preferred app
Bomba
ITA we do not find any merit in the objection rds the objection regarding the commer t is concerned, as per remand report accepted the fact that the project was t 11.5.2004; therefore, the preamendmen are applicable. Accordingly, in view of th
High in the case of Brahma Associates mmercial establishment in the housing pr
/s 80IB(10) prior to the insertion of e Hon'ble High Court in para 33 has obs ence of any provisions under the Inco s not justified in holding that up to M nder section 80- IB(10) would be allow the local authority having residentia ser up to 10 per cent. of the total builtup hen the project was approved prior to 1.4. allowing deduction u/s 801B once the re proved by the local authorities.
d the last contention of the revenue is tha and the income received by sale of TDR roject is concerned, we find that there is n the assessee received the TDR as a consi ment of the project in question. We furth ceived only for residential portion of the the commercial establishment. Thus, the assessee was immediately sold n was shown as receipt from the housin ther element in the said receipt against e income from housing project.
the case of the revenue that the assess ation of the value and therefore, the entir s sale consideration of the housing proje e details of the receipts of TDR and sale ear and immediately after receiving fro ere is no element of any appreciation in ation. In view of the above facts and circu not find any reason to interfere with the oth the AYs. 6 In the result, the appe dismissed.
aggrieved by the order of Hon'ble ITAT, peal before Hon'ble Bombay High Court on ay Slum Redevelopment
Corporation Pvt. Ltd.
6
A No. 6126/MUM/2025
raised by the Id rcial mmercial e t, the Assessing s approved vide nt of provision of he decision of the (supra), there is roject for availing clause (d) w.r.f served as under:
ome-tax Act, the March 31, 2005
wable to projects al building with area of the plot."
2005 then, there esidential project at the assessee is R and not by sale no dispute about ideration against her note that the e housing project when the TDR d and the sale ng project, then, the sale of TDR see sold the TDR re amount cannot ct. The assessee of the TDR as in om the MMDRA.
the value in the umstances of the e order of the Id als filed by the the revenue has n the same issue which was c
Bombay High dismissed the 80IB(10)(d) a relevant port incorporated a In this case, support of this Respondent-A 2. The Tribun that the objec will not be en sustained. U agreement, it termed as a m the land/imm necessary a construction.
3. In these ci
Commissione not for the satisfaction of together with In these circu disposed of.
7.2 Without p
Hon'ble ITAT, vide ITA No. 4
appeal in fa u/s.80IB(10)
29. From the M/s. Ackruti various slum
Slum Rehabil rehabilitation said FSI is off as deduction deduction in v from sale of F the Act for w
801B(10). The Bomba
ITA contested before Hon'ble ITAT. Howev h Court vide ITA No. 1391 of 2012 dated e appeal of the revenue on the issue of d and hence allowed the appeal of the tion of the decision of Hon'ble Bombay as under:
the only argument of the learned Advoc s Appeal is that the Tribunal should not h
Assessee's claim.
nal by the impugned order dated 8 June ction raised by the Assessing Officer that ntitled to deduction under Section 801B(
Upon scrutiny of the entire materials t is apparent that the Respondent-Asse mere contractor. He is a developer and c moveable property, that is how he proce agreements and appoint agents to ircumstances, the Tribunal's order, confir r, does not raise any substantial questio
Assessing Officer to have sat in jud of the statutory Authorities. The documen recitals were conclusive of the rights of umstances, the Appeal has no merits. It prejudice to the above, reliance is placed o
Mumbai in the case of Aarti Projects an 4190/Mum/2016 wherein, the Tribunal favour of the assessee on the issu of the Act.
e record we also found that group conc
City Ltd. (formerly Akruti Nirman Ltd.) m rehabilitation projects in various subu litation Authority gives FSI in lieu of cons building as consideration in kind. The ffered to tax and the profit derived therefr n u/s. 801B (10) of the Act. Ackruti ha various years. The AO has accepted elig
FSI /TDR. AO, however, denied deduction want of compliance of other pre-condi ese matters went up to Hon'ble Tribunal ay Slum Redevelopment
Corporation Pvt. Ltd.
7
A No. 6126/MUM/2025
ver, the Hon'ble
31.10.2014 has disallowance u/s e assessee. The y High Court is cate appearing in have allowed the e 2012 has held t the Respondent
(10)(d) cannot be s including the essee cannot be claiming rights in eeded to execute carry out the rming that of the on of law. It was dgment over the nts in that behalf the Assessee. 4. t is, accordingly, on the decision of nd Constructions has allowed the ue of deduction cern of assessee has undertaken urbs in Mumbai.
struction of slum consideration of rom was claimed as claimed such ibility of revenue n u/s.801B(10) of itions of Section and in all these years, Hon'b
80IB(10) of th
Bombay High that profits d deduction u/
dismissed thi relying on its Properties. Th
Court. These
Hon'ble Supre
30/04/2015. attained final any merit for AO is directed
8. In view of Hon'ble Bom
80IB(10)(d) of basis of whic the case of th
SLP before H adjudication.
Hon'ble ITAT decision of L rejected the merits. Hence the case of M the case of considered vi claimed by t
Assessing Off
IB of the vide
No.4 raised b
9. Since, the quantum, the and hence ne
4. Before us, the L assessee had chall proceedings by filing
Court. It was submit
Bomba
ITA le ITAT has upheld the claim of said he Act. Subsequently the Dept. filed appea h Court against the orders of Tribunal rais derived by assessee from housing projec s.801B(10) of I.T. Act. Hon'ble Bombay is appeal of the Dept. vide its order dat earlier decision dated 20/03/2012 in c hereafter, the Dept. preferred SLP before H matters were tagged along with oth eme Court has dismissed the SLP vide
Thus the decision of Hon'ble Bombay lity. 30. In view of the above discussion decline of claim of deduction u/s.801B( d to allow the same.
f the above, it is noted that the Hon'ble mbay High Court has allowed the di f the Act in the case of M/s Sonasha En ch the disallowance u/s.80IB(10) of the A he appellant. It is fine that revenue has p
Hon'ble Supreme Court and the same
However, it is worthwhile to mention later the Hon'ble Bombay High Court h
Ld.CIT(A) in the case of M/s Sonasha contention of the revenue by discussio e, following the decision of Hon'ble Bomb
M/s Sonasha Enterprises and decision of Aarti Projects and Constructions (Supr iew that the deduction u/s 80IB (10) of the appellant in its ROI for A.Y 2013
fficer is directed to delete the disallowan e order u/s 144 r.w.s 147 of the Act. He y the appellant is hereby allowed.
undersigned has allowed the appeal of other grounds raised by the appellant b ed no separate adjudication.”
Ld. counsel for the assessee sub lenged the very initiation of a writ petition before the Hon’b tted that the Hon’ble High Cour ay Slum Redevelopment
Corporation Pvt. Ltd.
8
A No. 6126/MUM/2025
d deduction u/s.
al before Hon'ble sing the question ct are eligible for High Court has ted 09/01/2013
case of Vandana
Hon'ble Supreme her matters. The e its order dated
High Court has n, we do not find
(10). Accordingly,
ITAT as well as isallowance u/s nterprises on the Act was made in preferred appeal is pending for n here that the has affirmed the Enterprises and on the issue on ay High Court in f Hon'ble ITAT in ra), I am of the the Act is rightly
3-14. Hence, the nce made u/s 80
ence, the Ground the appellant on become academic bmitted that the f reassessment ble Bombay High rt, vide order in Writ Petition No. 26
under section 148
including the reasses that the present app academic.
5. We have heard t on record. It is an ad
Court, while follow
Technologies Limited issued to the assess order reads as under “1. We are Petitions wil
Technologies
Circle 15(1)(2
concur.
2. Therefore, are quashed passed, the consequential quashed and 5.1 The legal conse
Once the very found invalidated by the jur passed pursuant th appeal arising out of adjudication on merit
Bomba
ITA

611 of 2024, has quashed the as well as all consequentia ssment order. Consequently, it peal filed by the Revenue has the rival submissions and perus dmitted position that the Hon’bl wing its earlier judgment v. ACIT, has quashed the reass see. The operative portion of th r:
informed by counsel for Petitioner/s ll be covered by the judgment in Limited v. Assistant Commissioner of I
2) Mumbai and Ors.' Counsel for Res the notices and orders impugned in thes and set aside. In case any re-assessme same also will stand quashed.
l demand notice or penalty notice will d set aside.”
equence of the above order is dation of the reassessment proc ri ictional High Court, the reas ereto ceases to exist in the e f such reassessment order does ts.
ay Slum Redevelopment
Corporation Pvt. Ltd.
9
A No. 6126/MUM/2025
e notice issued al proceedings, was contended become purely sed the material le Bombay High in Hexaware sessment notice he High Court’s that these
Hexaware
Income Tax spondent/s se petitions ent order is So also, also stand s unambiguous.
ceedings stands ssessment order eye of law. Any s not survive for 5.2 In this view of t which seek to challe reassessment order, that appellate autho issues. In view of th
Court quashing the adjudication on merit
6. In the result, th
Order pronoun (SANDEEP SING
JUDICIAL M
Mumbai;
Dated: 23/12/2025
Rahul Sharma, Sr. P.S.

Copy of the Order forward
1. The Appellant
2. The Respondent.
3. CIT
4. DR, ITAT, Mumbai
5. Guard file.

////

Bomba
ITA the matter, the grounds raised b enge the deletion of disallowan are rendered merely academic.
orities do not decide academic he binding order of the Hon’bl reassessment proceedings, w ts is called for in the present ap he appeal of the Revenue is dism ced in the open Court on 23/ GH KARHAIL)
(OM PRAK
MEMBER
ACCOUNTA ded to :

BY ORDER

(Assistant Re

ITAT, Mu ay Slum Redevelopment
Corporation Pvt. Ltd.
10
A No. 6126/MUM/2025
by the Revenue, nce made in the It is well settled or infructuous e Bombay High we hold that no ppeal.
missed.
12/2025. d/-
KASH KANT)
ANT MEMBER
R, gistrar) umbai