Time taken for the particles to collide,
$t = \frac{d}{V_{rel }} = \frac{100}{100} = 1 \sec$
Speed of wood just before collision = $gt = 10\, m/s$ & speed of bullet just before collision $v-gt$
= $100 - 10 = 90\, m/s$
Now, conservation of linear momentum just before and after the collision -
$-(0.02) (1v) + (0.02) (9v) = (0.05)v$
$\Rightarrow\, 150 \,=\, 5v$
$\Rightarrow \, v \,= \,30 \,m/s$
Max. height reached by body $h = \frac{v^2}{2g}$
$ h = \frac{30 \times 30}{2 \times 10} = 45\, m$
$\therefore$ Height above tower = $40\, m$