2008 (2) TMI 311

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.... (AGIL) and Maharashtra Glass and Agro Limited (MGAL). 3. A French company called Sekruti Saint Gobain (SSB) which was also in the same business as AGIL and MGAL, that is, safety glazing of automobile windshields had the intention of becoming a major supplier in India. Accordingly, AGIL, MGAL and SSB decided to join forces to meet the anticipated demand for laminated windshields and a joint venture agreement was entered into between them on 24^th February, 1994. As per the joint venture agreement, SSB was to be allotted certain preferential shares in AGIL and MGAL. 4. As a result of the joint venture agreement and certain other developments that took place, the promoters, including the Assessee, relinquished their right to manage MGAL....

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....ention was rejected by the Assessing Officer who concluded that the non-compete fee was really a consideration paid for a change in the shareholding in MGAL. The Assessing Officer also held that the non-compete fee was a revenue receipt and, therefore, chargeable to tax. 8. The appeal filed by the Assessee was accepted by the Commissioner of Income Tax (Appeals) ["the CIT(A)"] who concluded that the Assessee had made a proper disclosure of the receipt of non-compete fee much prior to the search and, therefore, the amount in question could not be treated as undisclosed income. It was also held that the non-compete fee received by the Assessee was a capital receipt not chargeable to tax. 9. The view expressed by CIT (A) was upheld by th....

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....sed income. As held by the Bombay High Court in Commissioner of Income Tax v. Vikram A. Doshi, [2002] 256 ITR 129, the transaction having been disclosed in the return, it is the subject matter of a regular assessment and not a block assessment. A similar view was expressed by the Bombay High Court in Commissioner of Income Tax v. Shamlal Balram Gurbani, [2001] 249 ITR 501. 12. A reading of the above provisions also makes it clear that there should be nondisclosure of income on the part of the Assessee and that such non-disclosure should have been detected as a result of the search. Neither of these two ingredients are present in so far as this appeal is concerned. 13. In N.R. Paper and Board Ltd. v. Deputy Commissioner of Income Tax, ....