TMI Blog2018 (9) TMI 475X X X X Extracts X X X X X X X X Extracts X X X X ..... ence of any evidence produced by the Department. In the said agreement, the non compete fee clause is clear by the assessee agreeing not to enter into any trade or start a similar production or enter into any competition with another party and the payment of non compete fee is for an action by the payee on a future date. The said payment of non compete fee is bound by a contractual requirement and it is a contractual right conferred on the assessee and in the event any violation, it was well open to the assessee to enforce the terms of the contract. The order of remand passed by the Tribunal is wholly unjustified and the facts as brought out by the CIT (A) after the first remand vide order dated 28.10.2016 are just and proper and in the absence of any new material produced by the assessee, the question of remanding the matter does not arise. Decided in favour of assessee - Tax Case Appeal No. 905 of 2017 & CMP. No. 13875 of 2018 - - - Dated:- 28-8-2018 - T. S. Sivagnanam And V. Bhavani Subbaroyan, JJ. For the Appellant : Mr.M.V.Swaroop For the Respondent : Mr.T.Ravikumar, SSC ORDER Judgment was delivered by T. S. Sivagnanam, J. This appeal, by the legal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the notice under Section 148 of the Act and also requested the reasons for reopening. The reasons for reopening were furnished by the Assessing Officer vide letter dated 25.8.2009. Subsequently, a notice under Section 143(2) of the Act dated 18.9.2009 was issued, in response to which, the assessee filed the reply dated 03.10.2009. 4. After verification of the details furnished and going through the return of income, the assessment was completed for the assessed income of ₹ 6,03,51,885/- as against the return of income of ₹ 3,51,885/-. In the assessment order, the Assessing Officer added back the entire amount of ₹ 6 Crores being the amount of non compete fee received by the assessee from the CABL and treated the same as income from business and profession received and accrued during the year under consideration. 5. Aggrieved by the said order, the assessee filed an appeal before Commissioner of Income Tax (Appeals)-XII [for brevity the CIT (A)], who, by order dated 24.9.2010, partly allowed the appeal in favour of the assessee i.e. with regard to addition of ₹ 6 Crores under the head 'non compete fee'. As against the order passed by the Appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal should have acted with greater circumspection to order a remand, particularly when the Revenue itself did not dispute that the materials were all those that were considered by the Assessing Officer. It was pointed out that remand is not a power to be exercised in a routine manner and should be used sparingly as an exception only when the facts warranted such course of action. It was held that the Tribunal should have arrived at its own conclusion on facts after due consideration of the materials before it, which were no different from which were placed before the Authorities below. 10. In the case before us, there is no dispute in respect of the fact that the assessee did not place any new material before the Tribunal even in the first round, when it passed the order dated 15.2.2012 remanding the matter to the CIT (A). A perusal of the order passed by the Tribunal dated 15.2.2012 would show that the Tribunal referred to the case of two other directors of the company namely Mr.P.Rajendra Rao and Mr.M.Ranjan Rao and in the case of those assessees, certain documents were filed by them at the appellate stage. Therefore, the Tribunal passed an order to remand the matter. When ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e fee and the good will. The CIT (A) held that the addition of ₹ 6 Crores should be deleted. 14. Further, it is relevant to point out that out of ₹ 6 Crores, the assessee received only ₹ 1 Crore and by the time the remaining payment was made, the company namely the CABL became defunct for having incurred huge losses during the financial years 2003-04 and 2004-05 with negative net worth of ₹ 68.49 Crores. When the Revenue carried the matter by way of appeal challenging the order of the CIT (A) dated 28.10.2016, the Tribunal ought to have decided the issue, if, in its opinion, the finding rendered by the CIT (A) was either factually incorrect or legally not tenable. However, there was no such finding to that effect. But, the Tribunal proceeded on the basis that the assessee should bring materials or evidence on record to substantiate or prove his claim. 15. As pointed out earlier, the assessee had not produced any new material at any point of time or at the first appellate stage. Therefore, the Tribunal should have decided the issue one way or the other and taken a stand as to whether the amount received/receivable was a capital receipt or a revenue rece ..... X X X X Extracts X X X X X X X X Extracts X X X X
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