Selective Purchase through Buy-Back Deemed To Be a Colourable Device To Avoid Taxes

Journal
Jhabakh, P.R. Kumar
India
Finance and Capital Markets (formerly Derivatives & Financial Instruments) 2012 (Volume 14), No. 6
PriceUSD 45

The Authority for Advance Ruling has deemed the selective buy-back of shares from shareholders out of the company’s reserves which had accumulated due to the non-distribution of profits, to be a colourable device framed to avoid the payment of tax. The author considers this case and the reasons for its significance.