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2020 (7) TMI 439 - HC - Income TaxSale of equity shares through Share Purchase Agreement having non-compete clause - allowable business income u/s 28(va) - Tribunal held that amount given for take over of business including Non-Compete covenant contained in the Sale Purchase Agreement was only share purchase agreement and not business take over, where the valuation is pursuant to Regulations 3[1] and 4 of the Securities and Exchange Board of India [Substantial Acquisition of Shares and Take overs] Regulations 2011, which deal with valuation of shares resulting in transfer of business? - HELD THAT:- As decided by ITAT Market rate in the Stock Exchange on the date of sale was ₹ 71/- per share and therefore, the excess price of ₹ 10/- per share received by the respondent/assessee was treated as non-compete fee by the AO and the Agreement also stipulates that no non-compete fee would be paid by the purchaser and on account of the fact that the assessee selling a large amount of 2,82,50,291 equity shares to M/s.Tube Investments of India to get control over the company and that apart, same amount has been paid to third party general public also. As brought to the knowledge of this Court by the learned counsel for the respondent/assessee that the rate of ₹ 81/- per share was offered to all shareholders vide Regulations 3[1] and 4 of the Securities and Exchange Board of India [Substantial Acquisition of Shares and Take overs] Regulations, 2011. CIT [Appeals] as well as ITAT, ''D'' Bench, Chennai, had exhaustively dealt with those issues and arrived at a categorical finding deciding those issues/questions in favour of the respondent/assessee. No substantial questions of law
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