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TMI Blog2016 (7) TMI 575X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellate Tribunal right in holding that provisions of section 28(iv) are not applicable in the case of assessee - Decided in favour of assessee - TAX APPEAL NO. 1151 of 2008 With TAX APPEAL NO. 1188 of 2008 With TAX APPEAL NO. 800 of 2013 - - - Dated:- 4-7-2016 - MR. KS JHAVERI AND MR. G.R.UDHWANI, JJ. FOR THE APPELLANT : MR SUDHIR M MEHTA, ADVOCATE FOR THE OPPONENT : MR RK PATEL, ADVOCATE ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) By way of these appeals, the appellant has challenged the order of the Income-tax Appellate Tribunal (hereinafter referred to as the Tribunal ) whereby the Tribunal has allowed the appeal of the assessee. Hence Tax Appeal Nos. 1151 of 2008 and 1188 of 2008 have been filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cer. The assessment was finalized on 26.11.2002 determining total income at ₹ 12,38,80,855/-. The amount of ₹ 10 crore received by the assessee as non-compete tax was taxed under section 45 r.w.s. 55(2) of the Act. 5. Being aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the learned Commissioner of Income-tax (Appeals) who dismissed the appeal vide order dated 23.4.2003 by holding that section 28(iv) of the Act is applicable to the case of the assessee. 6. Against the order of the Commissioner of (Appeals), the assessee preferred the appeal before the Tribunal. The Tribunal by its order dated 4.1.2008 allowed the appeal by holding that section 28(iv) of the Act was not appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase [(1964) 53 ITR 283 (SC)]. In the present case, the Department has not impugned the genuineness of the transaction. In the present case, we are of the view that the High Court has erred in interfering with the concurrent findings of fact recorded by the CIT(A) and the Tribunal. One more aspect needs to be highlighted. Payment received as non-competition fee under a negative covenant was always treated as a capital receipt till the assessment year 2003-04. It is only vide Finance Act, 2002 with effect from 1.4.2003 that the said capital receipt is now made taxable (see: Section 28(va)). The Finance Act, 2002 itself indicates that during the relevant assessment year compensation received by the assessee under non-competition agreement was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount received towards loss of source of income and non-competition fee could only be treated as capital receipt and was not liable to tax. 10. We have heard learned counsel for the parties. We have gone through the order of the Tribunal and the judgement cited by the learned counsel for the respondent. In our view, the issue is now squarely covered by the aforesaid decisions of the Apex Court. In that view of the matter, we dismiss the appeals preferred by the revenue. Accordingly, we answer the questions in favour of the assessee and against the revenue. 12. So far as Tax Appeal No. 800 of 2013 preferred by the assessee is concerned, in the light of the decision given in Tax Appeal Nos. 1151 of 2008 and 1188 of 2008, the appeal is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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