The assessee entered into a joint venture development agreement and an agreement for sale on 23-11-2005 with a developer for development of its land, under which it became entitled to 37.54% of the built-up area. In reassessment proceedings for AYs 2006-07 to 2011-12, one of the issues was whether the assessee was entitled to deduction u/s 80-IB(10) though no such claim had been made in the returns filed u/s 139(1). The High Court held that s. 80AC, inserted by the Finance Act, 2006 w.e.f. 1-4-2006, imposed a statutory condition that deduction u/s 80-IB would not be allowable unless claimed in a return filed within the due date prescribed u/s 139(1). Since the agreements were executed on 23-11-2005, when s. 80AC was not in force, that restriction could not be invoked to deny deduction for AY 2006-07. However, for AYs 2007-08 onwards, in view of the express language of s. 80AC, the assessee having admittedly not claimed deduction u/s 80-IB in the returns filed u/s 139(1), was not entitled to deduction u/s 80-IB(10). The Court further observed that the contention that s. 80AC was only procedural and directory, and not mandatory, could be considered only in an independent challenge under Art. 226 and not in an appeal u/s 260A. Accordingly, the appeals were dismissed. (AY. 2006-07 to 2011-12)