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 \u00a0In pursuance to same, assessee bought back shares from its shareholders and, accordingly it was treated as capital gains. \u00a0Respondent 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 . \u00a0Against said order, assessee filed writ petition . \u00a0Single 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 \u00a0the Division bench held \u00a0that \u00a0Single Judge was not right in going to merit while granting liberty to file an appeal \u00a0, however \u00a0\u00a0findings rendered by Single Judge on nature of transaction and scope under section 115-O \u00a0was \u00a0\u00a0set aside .<\/p>\n
\u00a0<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" S. 115O : Domestic companies – Tax on distributed profits \u2013 Buy back of shares \u2013 Approval of Scheme – Capital gains or dividend income \u2013 Direction to file an appeal before CIT (A) and also finding on merits – Decision on merit is held to be not valid \u2013 Direction to file an appeal is held to be justified. [ S. 2 (22)(d), 10 (34A), 46A, 115QA, 246A Art , 226 ] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-18998","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-4Wq","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/18998","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=18998"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/18998\/revisions"}],"predecessor-version":[{"id":18999,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/18998\/revisions\/18999"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=18998"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=18998"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=18998"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}