Becker Holding Corporation and Subsidiaries - Page 3

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          provided, in part, that for a period of 3 years Mr. Becker would            
          not “directly or indirectly engage in the processing or sale of             
          citrus concentrate or fresh juices” (covenant not to compete).              
               The total stated consideration for the transaction was                 
          $23,953,934 plus interest, payable over a period of 5 years.  In            
          its Federal income tax return for the tax year ending September             
          30, 1996, petitioner deducted $5,307,600 as an amortization                 
          expense.  Respondent’s Examination Division disallowed the                  
          amortization deduction in its entirety.                                     
               The case at bar was assigned to Appeals Officer Neil Kaufman           
          (Mr. Kaufman) to see whether it could be administratively                   
          resolved.  Mr. Kaufman was also assigned the case involving Mr.             
          Becker (the Becker case) in which the Examination Division took             
          the position that $5,307,600 was allocable to the covenant not to           
          compete, resulting in Mr. Becker’s having to recognize $5,307,600           
          of ordinary income in 1996.  Terri N. Beach (Ms. Beach) was Mr.             
          Kaufman’s supervisor and held the position of Appeals Team                  
          Manager.                                                                    
               The parties executed Form 872, Consent to Extend the Time to           
          Assess Tax, extending the period of limitations for the years at            
          issue to June 30, 2002.  Shortly thereafter, Lawrence Y. Leonard            
          (Mr. Leonard) undertook the representation of petitioner before             
          respondent’s Appeals Office (Appeals).  Mr. Leonard was aware               
          that Mr. Kaufman had also been assigned the Becker case.                    






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