In Wallfort Shares & Stock Brokers, a Five Member Special Bench of the Tribunal (96 ITD 1 (Mum) (SB)) and the Bombay High Court (310 ITR 421 (Bom)) held that the ‘loss’ incurred by an assessee in ‘dividend-stripping’ transactions cannot be disallowed on the ground that it was ‘tax-planning‘. The department’s SLP against the said judgement has been dismissed by the Supreme Court today, 6th July 2010.
Click here for the judgement of the Supreme Court.
See Also Porrits & Spencer (Asia) vs. CIT 231 CTR 294 (P&H) where the alleged conflict between McDowell 154 ITR 148 (SC) & Azadi Bachao Andolan 263 ITR 706 (SC) has been reconciled.
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