Assessee sought for an approval of scheme under sections 391 to 393 of Companies Act, 1956, involving purchase of shares from its shareholders . Scheme was approved by Court  In pursuance to same, assessee bought back shares from its shareholders and, accordingly it was treated as capital gains.  Respondent passed impugned order inter alia holding that transactions made in pursuant to buy back arrangement effected as a consequence to approval of Scheme required to be taxed under section 115-O on premise that it would constitute dividend and not capital gain .  Against said order, assessee filed writ petition .  Single Judge held that there was no merit in assessee’s contention that shares purchased pursuant to order of Company Court would be a capital gain and not to be treated as dividend . He, however, dismissed assessee’s petition with a liberty to them to file an appeal under section 246A in view of fact that assessee had already deposited a part of amount demanded . On appeal  the Division bench held  that  Single Judge was not right in going to merit while granting liberty to file an appeal  , however   findings rendered by Single Judge on nature of transaction and scope under section 115-O  was   set aside .