TMI Blog2016 (2) TMI 741X X X X Extracts X X X X X X X X Extracts X X X X ..... 153A/153C have to be confined only to the material found during the course of search. Further, even on merits, we find that the Central subsidy given for installing the food processing units in the specified areas is not asset specific but is industry specific. Therefore, it cannot be treated as income of the assessee. Therefore, the assessment order is not erroneous in so far as it is prejudicial to the interests of the Revenue. Hence, on both the counts, we hold that the order of the Ld. CIT under section 263 is not sustainable. - Decided in favour of assessee - ITA.No.224, 225/Hyd/2015 - - - Dated:- 20-1-2016 - SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER For The Assessee : Mr. K.A. Saiprasad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come returned by the assessee. 3. Subsequently, the Ld. CIT, by exercising his jurisdiction under section 263 of the Act, perused the assessment record and observed that the assessee has received ₹ 25 lakhs as Central subsidy (Food Proceeding) for each of the A.Ys which has been approved for the expansion of edible oil refinery. He observed that it is a capital subsidy and the amount was remitted to the company in two installments of ₹ 25 lakhs each during the F.Ys. 2006-07 and 2007-08 and the same was also reflected in the balance sheet for the years ending 31.03.2007 and 31.03.2008. He observed that the same should have been added to the total income of the year of receipt. Further he also observed that there were additions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the course of search, the A.O. could not have considered any other issue relating to the regular assessment during the assessment proceedings under section 143(3) read with section 153A of the I.T. Act. In support of this contention, he placed reliance upon the judgment of the Hon ble Bombay High Court in the case of CIT vs. Continental Warehousing Corporation (Nhava Sheva) Ltd., reported in 374 ITR 645 (Bom.) (HC). He also relied upon the decision of this Tribunal in the case of DCIT vs. AMR India Ltd., in ITA.No.1828 to 1831 of 2012 dated 23.10.2013. 4. Ld. CIT has directed the A.O. to re-do the assessment by considering the Central subsidy (Food Processing) which is outside purview of the assessment under section 143(3) read with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er hand, supported the orders of the authorities below and also placed reliance upon the judgment of jurisdictional High Court in the case of Gopal Lal Bhadruka in ITTA.No.367 to 369 of 2011 and others dated 15th December, 2011 for the proposition that in the assessments under section 153A, the A.O. can take into consideration material other than what was available during the search and seizure operation for making an assessment of the undisclosed income of the assessee. Therefore, according to him, the order of the Ld. CIT under section 263 is sustainable. 6. Having regard to the rival contentions and the material on record, we find that the assessee has filed its returns of income for the relevant assessment years on 30.10.2007 and 25. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he relevant F.Ys and therefore, receipt cannot become the income of the assessee for the relevant A.Ys. Be that as it may, the Ld. CIT under section 263 of the Act cannot direct the A.O. to do what the A.O. cannot do during the course of assessment under section 143(3) read with section 153A of the I.T. Act. It has been laid down by the Hon ble Supreme Court as well as various High Courts in a catena of cases, that in the cases of completed assessments, assessments under section 143(3) read with section 153A have to restrict to the material found and seized during the course of search and cannot consider the material disclosed by the assessee in its return of income. It is only in the case of the assessments which are pending with the A.O. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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