TMI Blog2014 (3) TMI 759X X X X Extracts X X X X X X X X Extracts X X X X ..... f the receipt under a non-compete agreement - The reasons for the notice u/s 147 nowhere mentioned that the revenue came up with any other fresh material warranting reopening of assessment – thus, mere conclusion of the proceedings u/s 143(1) ipso facto does not bring invocation of powers for reopening the assessment – the order of the Tribunal upheld – Decided against Revenue. - ITA 112/2014 - - - Dated:- 18-3-2014 - S. Ravindra Bhat And R. V. Easwar,JJ. For the Appellant : Ms. Suruchi Aggarwal, sr. standing counsel For the Respondent : Mr. Salil Aggarwal, Adv. ORDER S. Ravindra Bhat, J. (Open Court) The revenue is in appeal aggrieved by the order dated 20.9.2013 of the Income Tax Appellate Tribunal (ITAT) where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to tax. However, the income of the assessee of Rs. 88 lacs received by him should be chargeable to tax as it is not a capital receipt but is to be charged to income tax under the head Profit Gains of Business of Profession . In terms of section 28 of the IT Act, 1961, section 28 is reproduced hereunder to bring the assessee in net of this provision. 'any compensation or other payment due to or received by; a) any person by whatever name called managing the of an Indian company at or in connection with the termination of his management or the modification of the terms and conditions relating thereto. In the light of the above facts, income ofRs.88 lacs has escaped assessment and the very fact that the assessee has already pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessment stage. This according to the revenue justified the reassessment proceedings. 5. As to what constitutes valid reasons to believe is no longer a matter of debate. So long as the law declared in Kelvinator (supra) stands, a valid reopening of assessment has to be based only on tangible material to justify the conclusion that there is escapement of income. In the present case the note forming part of the return clearly mentioned and described the nature of the receipt under a non-compete agreement. The reasons for the notice under section 147 nowhere mentioned that the revenue came up with any other fresh material warranting reopening of assessment. In these circumstances, the Court is of the opinion that mere conclusion of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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