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2011 (7) TMI 523 - HC - Income TaxCapital gains or Business income - Amount received under non-competition agreement - The assessee is not the person who has transferred the assets of the companies and the firms in which he was actively involved - Held that:- Under a separate agreement for transfer of assets and right to manufacture, separate consideration has been paid and for which tax is collected from the companies which received the consideration for such transfer - The present agreement no doubt came to be executed contemporaneously on the same day but, the consideration paid under this agreement is to the assessee not to compete with the purchaser in respect of the subject matter of the other agreement - In the first place, the assesses has not transferred any capital asset to the purchaser - It has not transferred any right to produce or manufacture any article. The consideration paid to him is not to compete - Therefore, the case would not fall under Section 55(2) of the. Act. It is because it was not falling under Section 55(2) and was not falling under any other provisions of the Act - Therefore, only from 1.4.2003 the consideration received under a non-competition agreement is chargeable to tax under the heading of profits and gains of business.
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