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2021 (4) TMI 1185 - AT - Income TaxRevision u/s 263 - subsidy amount received by the assessee attracts the provisions of Explanation 10 to section 43(1) of the Act is not proper - HELD THAT:- As subsidy is for cost of plant & machinery and technical civil works. Therefore, we are not inclined to accept the submission of the ld. AR that the subsidy was not for the cost of the particular assets and as per the above scheme, there is a restrictive clause that the subsidy shall be kept by the beneficiary in the form of fixed deposits without any interest which has been complied by the assessee. It is clear from the financial statements under Schedule XIV that the deposits with the bank (against subsidy received) ₹ 50 lakhs. The assessee cannot utilize the funds till the locking period as framed by the Govt. of India for enjoying the subsidy to the beneficiary. There is no doubt that as per the section 43(1) Explanation 10, the assessee should reduce the cost of the fixed assets from the subsidy amount, but, in the impugned AY, the assessee has been barred by limitation as provided in the scheme. Considering the above scheme framed by the Govt. of India, under which, the assessee has received the subsidy, ld. Pr. CIT has not justified for this impugned AY revising the assessment framed u/s. 143(3) of the Act by exercising powers u/s. 263 of the Act. Therefore, the finding of the Pr. CIT that the subsidy amount received by the assessee attracts the provisions of Explanation 10 to section 43(1) of the Act is not proper and the same is not applicable to the case of the assessee. Therefore, we set aside the order passed by the Pr. CIT and restore the order of the AO. Appeal of the assessee is allowed.
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