McDowell & Co. Ltd. v. CTO

154 ITR 148Supreme Court of India1985#68 most cited

What is McDowell & Co. Ltd. v. CTO authority for?

The Supreme Court held that while legitimate tax planning is permissible, transactions structured as a "colourable device" or "subterfuge" solely to avoid tax are impermissible. It mandates a judicial shift to look beyond the form to the substance of a transaction, allowing the lifting of the corporate veil in tax evasion arrangements.

741

judgments rely on this decision, according to BharatTax’s citation analysis of 292,668 Indian tax judgments — from 2008 to 2026.

Also referred to as

McDowell & Co. Ltd. v. CTO · 154 ITR 148 · tax avoidance vs. tax planning · colourable device · substance over form · lifting corporate veil · tax evasion · accommodation entry · genuineness of transaction · sections 143(3) · 147 · 68 · 69C

Also reported as

22 Taxmann 113 SCC 2301 SCR 914

Sections most often in play

Section 143(3)Section 148Section 147Section 68Section 69CSection 133ASection 132(4)Section 143(2)

Issues it is cited on

colourable deviceazadi bachao andolanlive linkentry operatorpenny stocksection 10(38)genuineness of the transactionlong term capital gainsaddition u/s 68share application moneyaccommodation entrysection 131

Judgments citing McDowell & Co. Ltd. v. CTO

DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-4, NAGPUR, NAGPUR vs. SHIKHA INDRAKUMAR AGRAWAL, NAGPUR

In the result, appeal by the assessee stands allowed

ITA 239/NAG/2023[2015]Status: DisposedITAT Nagpur10 Apr 2026

Bench: Shri Pawan Singh & Shri Khettra Mohan Roy

For Appellant: Shri K.P. Dewani, AdvocateFor Respondent: Shri Surjit Kumar Saha, Sr. DR
Section 10(38)Section 143(2)Section 143(3)Section 250Section 68Section 69C

…t tangible material or evidence to both establish that assessee had undisclosed income and further that the share transaction undertaken were bogus. Reference can be made to the judgement of Hon’ble Supreme Court in the case of McDowell & Co. Ltd. reported at 154 ITR 148 (SC). It has been held that the act of questioning the very basis of a transaction and branding it as illegitimate or a camouflage has to be based on substantial, concrete and cogent evidence, wherein the proof of wrong-doing has to be clear and succinct. In this connection, reference may be made to the observations of the Hon’ble Supreme Court i…

DCIT-CC-2(1), NAGPUR, NAGPUR vs. INDRAKUMAR GHISULAL AGRAWAL, NAGPUR

In the result, appeal by the assessee stands allowed

ITA 220/NAG/2023[2015-16]Status: DisposedITAT Nagpur10 Apr 2026AY 2015-16

Bench: Shri Pawan Singh & Shri Khettra Mohan Roy

For Appellant: Shri K.P. Dewani, AdvocateFor Respondent: Shri Surjit Kumar Saha, Sr. DR
Section 10(38)Section 143(2)Section 143(3)Section 250Section 68Section 69C

…to both establish that assessee had undisclosed income and (Indrakumar Ghisulal Agrawal) further that the share transaction undertaken were bogus. Reference can be made to the judgement of Hon’ble Supreme Court in the case of McDowell & Co. Ltd. reported at 154 ITR 148 (SC). It has been held that the act of questioning the very basis of a transaction and branding it as illegitimate or a camouflage has to be based on substantial, concrete and cogent evidence, wherein the proof of wrong-doing has to be clear and succinct. In this connection, reference may be made to the observations of the Hon’ble Supreme Court i…

ZARAH RAFIQUE MALIK,MUMBAI vs. ITO (INT TAX) WARD-3(2)(1), MUMBAI

ITA 5159/MUM/2025[2022-23]Status: DisposedITAT Mumbai10 Mar 2026AY 2022-23

Bench: Justice (Retd.) C V Bhadang, Hon’Ble & Shri Vikram Singh Yadav, Hon’Blezarah Rafique Malik Income Tax Officer, (Int.Tax) B/1703, Vivarea Condominium, Ward- 3(2)(1), Mumbai Vs. Sane Guruji Marg, Jacob Circle, Mahalaxmi East Mumbai – 400 011 Pan : Adcpm8960G (Appellant) (Respondent)

For Appellant: Shri K Gopal, Adv. & Shri Oom KandalkarFor Respondent: Shri Krishna Kumar, Sr. DR
Section 120(4)(b)Section 127Section 143(2)Section 143(3)Section 144BSection 153(1)

…IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES “I”, MUMBAI Before Justice (Retd.) C V Bhadang, Hon’ble President & Shri Vikram Singh Yadav, Hon’ble Accountant Member Zarah Rafique Malik Income Tax Officer, (INT.TAX) B/1703, Vivarea Condominium, Ward- 3(2)(1), Mumbai Vs. Sane Guruji Marg, Jacob Circle, Mahalaxmi East Mumbai – 400 011 PAN : ADCPM8960G (Appellant) (Respondent) Appellant By : Shri K Gopal, Adv. & Shri Oom Kandalkar Respondent By : Shri Krishna Kumar, Sr. DR Date of Hearing : 21.01.2026 Date of Pronouncement: 10.03.2026 O R D E R PER VIKRAM SINGH YADAV, A.M : By this appeal, appellant-assessee…

ASST. COMMISSIONER OF INCOME TAX, MUMBAI vs. RELIANCE RETAIL LIMITED, MUMBAI

In the result, the appeal filed by the Revenue is dismissed, whereas the appeal filed by the assessee is partly allowed

ITA 4244/MUM/2025[2019-20]Status: DisposedITAT Mumbai10 Mar 2026AY 2019-20

Bench: SHRI SAKTIJIT DEY (Vice President), SHRI MAKARAND VASANT MAHADEOKAR (Accountant Member)

Section 135Section 143(3)Section 144BSection 14ASection 250Section 37(1)Section 80GSection 80JSection 92C

…defeat that legislative intent. He also referred to Schedule VII of the Companies Act and took the view that CSR funds cannot be given as donation to a trust or society in the manner claimed by the assessee. Relying additionally on McDowell & Co. Ltd. v. CTO (154 ITR 148) and Apex Laboratories Pvt. Ltd. v. DCIT (135 taxmann.com 286), the Assessing Officer concluded that the assessee was attempting to obtain, indirectly, a deduction which the legislature intended to deny. He accordingly disallowed the deduction of Rs. 10,53,00,000/- claimed under section 80G. 101. In appeal, the assessee reiterated that the disall…

RELIANCE RETAIL LIMITED ,MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 8(1)(1), MUMBAI

ITA 3510/MUM/2025[2019-20]Status: DisposedITAT Mumbai10 Mar 2026AY 2019-20

Bench: Shri Saktijit Dey & Shri Makarand Vasant Mahadeokar

Section 135Section 143(3)Section 144BSection 14ASection 250Section 37(1)Section 80GSection 80JSection 92C

…defeat that legislative intent. He also referred to Schedule VII of the Companies Act and took the view that CSR funds cannot be given as donation to a trust or society in the manner claimed by the assessee. Relying additionally on McDowell & Co. Ltd. v. CTO (154 ITR 148) and Apex Laboratories Pvt. Ltd. v. DCIT (135 taxmann.com 286), the Assessing Officer concluded that the assessee was attempting to obtain, indirectly, a deduction which the legislature intended to deny. He accordingly disallowed the deduction of Rs. 10,53,00,000/-. claimed under section 80G. 101. In appeal, the assessee reiterated that the disal…

ITO 19.3.1, MUMBAI vs. VARUN JAISINGH ASHER, MUMBAI

In the result, the appeal of the revenue bearing ITA No

ITA 8251/MUM/2025[2020-21]Status: DisposedITAT Mumbai06 Mar 2026AY 2020-21

Bench: Shri. Girish Agrawalito -19(3)(1), Mumbai Varun Jaisingh Asher Room No.405, 4Th Floor, Piramal Arkade Rise, 17Th Floor, 31-A, Vs. Chambers, Lower Parel Mumbai Carmichael Road, Cumballa Hills, 400012 Mumbai 400026 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Aiapa1791N (Appellant) (Respondent)

For Appellant: Shri. Dharan GandhiFor Respondent: Shri. Sushil Shengde, SR DR
Section 143(3)Section 250Section 54FSection 56(2)(x)

…hts, is not correct. The AO relied on decision given in the case of Sumati Dayal v. CIT [1995] 214 ITR 801 (SC) to justify rejection of documentary evidence based on surrounding circumstances and decision given in the case of McDowell & Co. Ltd. v. CTO [1985] 154 ITR 148 (SC) to argue that tax planning through colourable devices should be struck down. Facts of these case laws are different from the facts of the appellant. Case Laws relied on by the AO pertain to unexplained cash credits and tax avoidance but the appellant’s case is of documented tenancy and transactions are supported by registered agreements and…

HAMEED MARINE PRIVATE LIMITED,EDALAKUDY, NAGERCOIL vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-1, NAGERCOIL, INCOME TAX OFFICE, NAGERCOIL

In the result, Grounds relating to validity of notice u/s 143(2) are dismissed

ITA 2317/CHNY/2025[2017-2018]Status: DisposedITAT Chennai18 Feb 2026AY 2017-2018

Bench: Shri Manu Kumar Giri & Shri S.R.Raghunatha

For Appellant: Mr. T. Vasudevan, AdvocateFor Respondent: 12.01.2026
Section 143(2)Section 143(3)Section 43(1)

…आयकर अपील"य अ"धकरण, ’ए’ "यायपीठ, चे"नई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH: CHENNAI "ी मनु कुमार िग"र, "ाियक सद" एवं "ी एस. आर. रघुनाथा, लेखा सद" के सम" BEFORE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND SHRI S.R.RAGHUNATHA, ACCOUNTANT MEMBER आयकर अपील सं./ITA No 2317/Chny/2025 "नधा"रण वष"/Assessment Year: 2017-18 HAMEED MARINE PRIVATE LIMITED v. The ACIT, CIRCLE-1, No. 27/1, RASAK ROAD, EDALAKUDY, NAGERCOIL, NAGERCOIL, NAGERCOIL SIVARAJ BUILDING, TOWER TAMIL NADU-629002 JUNCTION ROAD, NEGERCOIL-629001 [PAN: AADCH 3419 C] (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ" क ओर से/ Appellant/Assessee by :…

ITO, WARD-2(3)(1), KANPUR, KANPUR vs. KHANNA SALES (INDIA) PVT. LTD., KANPUR

In the result, the appeal of the Revenue is dismissed

ITA 232/LKW/2025[2017-18]Status: DisposedITAT Lucknow16 Feb 2026AY 2017-18

Bench: Sh. Sudhanshu Srivastava & Sh. Nikhil Choudharya.Y. 2017-18 Ito, Vs. Khanna Sales (India) Pvt. Ltd., Ward-2(3)(1), Kanpur 54/34, Nayaganj, Kanpur Pan: Aabck4442N (Appellant) (Respondent) Assessee By: Sh. Swarn Singh, C.A. Revenue By: Sh. Amit Kumar, Addl. Cit Dr Date Of Hearing: 20.11.2025 Date Of Pronouncement: 16.02.2026 O R D E R Per Nikhil Choudhary, A.M.: This Is An Appeal Filed By The Revenue Against The Orders Of The Ld. Cit(A), Nfac Wherein The Ld. Cit(A) Has Allowed The Appeal Of The Assessee Against The Orders Of The Ld. Ao Passed Under Section 143(3) For The A.Y. 2017- 18 On 29.12.2019. The Grounds Of The Appeal Are As Under: - “1- Ld. Cit (A) Has Erred In Law & Facts By Not Appreciating The Pattern Of Cash Sales Discussed By The Assessing Officer In Detail In His Order Which Shows A Substantial Jump Of 38% Of Total Sales In The Month Of October, 2016 I.E. The Period Immediately Prior To Demonetization In November, 2016. Cash Sales Before & After This Period Is Negligible. 2. That The Appellant Craves Leave To Add Or Amend Any One Or More Of The Grounds Of Appeal As Stated Above As & When Need For Doing So May Arise. 3. Ld. Cit(A) Has Erred In Law & Facts In Deleting The Addition Of 3 Rs. 2,64.19.000/- On Account Of Cash Deposits U/S 68 Of The Income Tax Act 1961. 4. Ld. Cit(A) Has Erred In Law & Facts By Not Appreciating That U/S 68 The Ao Is Not Required To Reject The Books Of Accounts. The Only Requirement Is That, If The Explanation Offered By The Assessee Is Not, In The Opinion Of The Assessing Officer Satisfactory, The Sum (Cash Sales) So Credited Can Be Charged To Income-Tax As The Income Of The Assessee Of That Previous Year.”

For Appellant: Sh. Swarn Singh, C.AFor Respondent: Sh. Amit Kumar, Addl. CIT DR
Section 143(3)Section 68

…one to shown bogus sales. He thereafter, placed reliance on the decision of the Hon’ble Supreme Court in the case of Sumati Dayal vs. CIT (1995) 214 ITR 801 (SC) and Sunil Siddharthbhai vs. CIT 156 ITR 507 (SC) as also the case of Mcdowell and Co. reported in 154 ITR 148 (SC) to hold that the income tax authorities were allowed to go behind the transactions and examine whether it was genuine or avoidance of tax through colourable devices which was not permissible. Using the VAT returns filed the assessee prior to demonetization, he calculated the daily sales during the period of 39 days prior to demonetization an…

ASSISTANT COMMISSIONER OF INCOME TAX, CHENNAI vs. MANIKANDAN, CHENNAI

ITA 2986/CHNY/2025[2017-18]Status: DisposedITAT Chennai16 Feb 2026AY 2017-18

Bench: Shri Aby T. Varkey & Ms. Padmavathy.Sआयकर अपील सं./Ita No.2986/Chny/2025 निर्धारण वर्ष /Assessment Year: 2017-18 The Asst. Commissioner Of Income Tax, Non Corporate Circle-4(1), Chennai. Manikandan, Vs. No.15/16/17, Vision Towers, 2Nd Floor, Yogam Garden, Valasarvakkam, Chennai - 600 087. Pan: Behpm 6583A (अपीलार्थी/Appellant) (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से / Assessee By प्रत्यर्थी की ओर से /Revenue By Mr. R. Sivaraman, Advocate Ms. R. Anitha, Addl. Cit सुनवाई की तारीख/Date Of Hearing घोषणा की तारीख /Date Of Pronouncement 11.02.2026 16.02.2026 Per Padmavathy.S, A.M: आदेश / Order This Appeal By The Revenue Is Against The Order Of The Commissioner Of Income Tax (Appeals)/National Faceless Appeal Centre (Nfac), Delhi, (In Short "Cit(A)") Passed U/S. 250 Of The Income Tax Act, 1961 (In Short "The Act") Dated 26.08.2025 For Assessment Year (Ay) 2017-18. The Assessee Raised The Following Ground Of Appeal: “1. The Order Of The Ld Cit(A) Is Contrary To Law & Facts & Circumstances Of The Case. 2 The Ld Cit(A) Erred In Deleting The Addition Made By The Ao Of An Amount Of Rs.2,98,29,315/- Credited In Assessee'S Capital Account By M/S Crcl Llp, In Which Assessee Is A Partner, For Sacrificing / Relinquishing - 2 -:

Section 147Section 2Section 2(14)Section 2(47)Section 250Section 45Section 45(3)

…आयकर अपीलीय अधिकरण, 'सी' न्यायपीठ, चेन्नई। IN THE INCOME TAX APPELLATE TRIBUNAL 'C' BENCH: CHENΝΑΙ श्री एबी टी. वर्की, न्यायिक सदस्य एवं सुश्री पदमावती यस, लेखा सदस्य के समक्ष BEFORE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND MS. PADMAVATHY.S, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.2986/Chny/2025 निर्धारण वर्ष /Assessment Year: 2017-18 The Asst. Commissioner of Income Tax, Non Corporate Circle-4(1), Chennai. Manikandan, Vs. No.15/16/17, Vision Towers, 2nd floor, Yogam Garden, Valasarvakkam, Chennai - 600 087. PAN: BEHPM 6583A (अपीलार्थी/Appellant) (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से / Assessee by प्रत्यर्थी क…

UDAY UTTAMRAO NEVASE,PUNE vs. THE ASSESSING OFFICER / ASSESSMENT UNIT, PUNE

In the result, appeal of the assessee in ITA No

ITA 2606/PUN/2025[2022-23]Status: DisposedITAT Pune10 Feb 2026AY 2022-23

Bench: Dr.Dipak P. Ripote & Shri Vinay Bhamoreआयकर अपऩल सं. / Ita No.2606/Pun/2025 निर्धारण वषा / Assessment Year: 2022-23 Uday Uttamrao Nevase, V The Assessing Officer / Saugandh Niwas, Hind Colony S Assessment Unit, Pune. Lane No.1 A, Bhekrai Nagar, Phursungi, Pune – 412308. Pan: Akqpn1150Q Appellant/ Assessee Respondent /Revenue Assessee By Ca Rohan Gupta Revenue By Shri Harshit Bari – Addl.Cit(Virtual) Date Of Hearing 16/12/2025 Date Of Pronouncement 10/02/2026 आदेश/ Order Per Dr. Dipak P. Ripote, Am: This Is An Appeal Filed By The Assessee Against The Order Of Ld.Commissioner Of Income Tax(Appeal)[Nfac], Passed Under Section 250 Of The Income Tax Act, 1961 For The A.Y.2022-23 Dated 04.09.2025 Emanating From The Penalty Order Passed Under Section 270A, Dated 17.09.2024. The Assessee Has Raised The Following Grounds Of Appeal : “Ground 1 Section 270Aa Immunity Cit A Erred In Law By Confirming The Penalty Of Rs 629382 Under Section 270A Without Considering And

Section 143(3)Section 250Section 270A

…aiming fraudulently refund by increasing deduction and reducing his taxable income since A.Y. 2016-17 onwards. Reference maybe made to the decision of the Hon'ble Supreme Court in the case of Mc Dowell & Co. Ltd. v. Commercial tax Officer [1985] 22 Taxman 11 /154 ITR 148 wherein the Hon'ble Supreme Court has held that "Tax planning may be legitimate provided it is within the framework of law, Colourable devices cannot be part of tax planning....". In the case of Dy. CIT v. Pawan Kumar Malhotra [2010] 2 ITR (T) 250 (Delhi - Trib.), it was observed that AO had come to a conclusion after meticulous enquiry as regard…

DCIT - 19(1), MUMBAI, LALBAUGH vs. BHARAT RAMJI BHAI MANEK, GRANT ROAD MUMBAI

In the result, the appeal of the revenue bearing ITA No

ITA 4339/MUM/2025[2014-15]Status: DisposedITAT Mumbai10 Feb 2026AY 2014-15

Bench: SHRI ANIKESH BANERJEE (Judicial Member), SHRI MAKARAND VASANT MAHADEOKAR (Accountant Member)

For Appellant: Shri Ronak DoshiFor Respondent: Shri Leyaqat Ali Aafaqui, (SR DR)
Section 10(38)Section 143(3)Section 250

…on its investigation.CIT(A)'s reliance on SEBI, noting that the order did not exonerate the scrip's manipulation and that the assessee's transaction fits the penny stock evasion pattern. Judicial Precedents: Supreme Court: In McDowell & Co. Ltd. v. CTO [1985] 154 ITR 148 (SC), the Court condemned colorable devices for tax avoidance, emphasizing that transactions must have commercial purpose beyond tax benefits. ITAT Mumbai: in ITO -24(2)(1), Mumbai v. Kailash Chandra Gupta (HUF) (dated 26.07.2024, relevant to 2025 discussions), the Tribunal recognized the menace of bogus LTCG through penny stocks, upholding addit…

DEVADAS ANUP,BANGALORE vs. INCOME TAX OFFICER, WARD-6(2)(1), BANGALORE

In the result, the appeal of the assessee is allowed

ITA 1933/BANG/2025[2018-19]Status: DisposedITAT Bangalore02 Feb 2026AY 2018-19

Bench: Shri Waseem Ahmed & Shri Keshav Dubeyassessment Year: 2018-19

For Appellant: Shri Guruswamy H, ITPFor Respondent: Shri Ganesh R Ghale, Advocate – Standing
Section 133(6)Section 139(1)Section 250

…122 (SC)] has held that private arrangements cannot defeat the charging provisions of the Income-tax Act. The income is to be taxed in the hands of the person on whom the right, title, and licence is conferred. Similarly, in McDowell & Co. Ltd. v. CTO [(1985) 154 ITR 148 (SC)], it has been held that tax planning arrangements that are colorable devices must be disregarded in determining the real nature of transactions. 7.3 It is undisputed that liquor worth Rs. 3,61,05,162/- was purchased from KSBCL in the name of the appellant. The lessee, Shri B.S. Anil Kumar, categorically admitted during proceedings u/s 133(6)…

DINDAYAL MAGASVARGIYA SAHAKARI SOOT GIRNI LTD ,WAGHWADI vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE, SANGLI., NISHANT COLONY

In the result, the appeal filed by the assessee is allowed

ITA 2325/PUN/2025[2013-14]Status: DisposedITAT Pune29 Jan 2026AY 2013-14

Bench: Shri Manish Borad & Shri Vinay Bhamoreआयकर अपील सं. / Ita No.2325/Pun/2025 िनधा"रण वष" / Assessment Year : 2013-14 Dindayal Magasvargiya Vs. Acit, Circle Sangli, Sahakari Soot Girni Ltd., Sangli. At Waghwadi, Post Kameri, Tal. Walwa, Sangli- 415403. Pan : Aaaad0254E Appellant Respondent Assessee By : Shri Pramod S. Shingte Revenue By : Shri R. Y. Balawade Date Of Hearing : 27.01.2026 Date Of Pronouncement : 29.01.2026 आदेश / Order Per Vinay Bhamore, Jm: This Appeal Filed By The Assessee Is Directed Against The Order Dated 01.08.2025 Passed By Ld. Cit(A)/Nfac For The Assessment Year 2013-14. 2. The Appellant Has Raised The Following Grounds Of Appeal :- “1. On The Facts & In The Circumstances Of The Case & In Law, Ld. Ao Erred In Initiating Reassessment Proceedings U/S 147 For Ay 2013-14, Being The Year Beyond 4 Years & For Which Assessment Order U/S 143(3) Has Already Been Passed, Thereby

For Appellant: Shri Pramod S. ShingteFor Respondent: Shri R. Y. Balawade
Section 143(2)Section 143(3)Section 147Section 148Section 37Section 43B

…t was never payable. As per provisions of section 37 of the Act, provision for unascertained liability is not allowable deduction for purposes of income tax. Further, it has been held by the Supreme Court in McDowell and Co. Ltd Vs Commercial Tax Officer (SC) 154 ITR 148 that colorable devices are not part of tax planning Tan View of the above a sum of Rs 2,42,00,000/- for AY. 2013-14 remains unexplained. Hence, an amount of Rs. 2,42,00,000/- debited to profit and loss loss account as interest on loan from the Govt. of Maharashtra as explained above and not paid to the Government is disallowed and added to the in…

NATHARAM PANAJI CHOUDHARY,PUNE vs. I.T.O. WARD 8(1), PUNE, PUNE

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 1826/PUN/2024[2016-17]Status: DisposedITAT Pune21 Jan 2026AY 2016-17

Bench: Shri R.K. Panda & Ms. Astha Chandra

For Appellant: Shri Bharat Kumar (Virtually)For Respondent: Shri Amol Khairnar
Section 132Section 142(1)Section 147Section 148Section 69A

…Mishra (320 ITR 1), in which the Hon‟ble Apex Court noted with grave concerned the rampant circulation of unaccounted money destroying the economy of our country. Further, the ratio of the decision of the Hon‟ble Supreme Court in the case of Mc Dowell Vs CTO (154 ITR 148) is also relied upon. In this land mark decision, the Hon‟ble Apex Court noted with concern the colourable devices of tax planning. 4.3.8 Considering the gamut of issues dealt with in the assessment order with which the undersigned concurs, the decision of the assessing officer is upheld and ground No. 1 raised in this appeal is dismissed.” AYs.…

NATHARAM PANAJI CHOUDHARY,PUNE vs. I.T.O. WARD 8(1), PUNE, PUNE

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 1823/PUN/2024[2015-16]Status: DisposedITAT Pune21 Jan 2026AY 2015-16

Bench: Shri R.K. Panda & Ms. Astha Chandra

For Appellant: Shri Bharat Kumar (Virtually)For Respondent: Shri Amol Khairnar
Section 132Section 142(1)Section 147Section 148Section 69A

…Mishra (320 ITR 1), in which the Hon‟ble Apex Court noted with grave concerned the rampant circulation of unaccounted money destroying the economy of our country. Further, the ratio of the decision of the Hon‟ble Supreme Court in the case of Mc Dowell Vs CTO (154 ITR 148) is also relied upon. In this land mark decision, the Hon‟ble Apex Court noted with concern the colourable devices of tax planning. 4.3.8 Considering the gamut of issues dealt with in the assessment order with which the undersigned concurs, the decision of the assessing officer is upheld and ground No. 1 raised in this appeal is dismissed.” AYs.…

PROPERTY PLUS REALTORS,DELHI vs. PR, CIT CENTRAL DELHI 2, DELHI

In the result, appeal of the assessee is allowed

ITA 3406/DEL/2025[2020-21]Status: DisposedITAT Delhi21 Jan 2026AY 2020-21

Bench: Shri Yogesh Kumar U.S & Shri Manish Agarwal

Section 132Section 143(2)Section 143(3)Section 145(3)Section 263

…t. Ground No.3 3. Because on facts and in law and on grounds taken and basis adopted, the Ld. PCIT erred in invoking Judicial Anti Avoidance Rule ("JAAR") relying upon the judgement in the case of M/s McDowell and Company Ltd. v. Commercial Tax Officer (1985) 3 SCC 230] completely ignoring the fact that the legislature by Rule 10U of the Income Tax Rule, 1962 application of Chapter X-A [GAAR Provisions] in cases/arrangement where the tax benefit in the relevant assessment year arising, in aggregate, to all parties to the arrangement does not exceed a sum of Rs.3.00 crore [Rule 10U(1)(a)]. Therefore, the impugned…

THE AUTHORITY FOR ADVANCE RULINGS (INCOME TAX) vs. TIGER GLOBAL INTERNATIONAL II HOLDINGS

C.A. No.-000262-000262 - 2026Supreme Court15 Jan 2026

Bench: HON'BLE MR. JUSTICE R. MAHADEVAN

…n law by Mauritian authorities. Treaty shopping and sham transactions are distinct concepts; the Department has conflated them. If Treaty abuse existed, it was for the Contracting States to amend the Treaty, which they have done prospectively. 18 (1985) 3 SCC 230 47 8.13. It was also submitted by the learned Senior Counsel that the Government of India has notified the Mauritius Treaty under Section 90 of the Act, and under Section 90(2), the Treaty prevails to the extent more beneficial to the assessee. Therefore, the charge of tax under the Income Tax Act will be overridden by a more beneficial…

ASSISSTANT COMMISSIONER OF INCOME TAX, JHANDEWALAN EXTN. vs. OM PRAKASH ARORA, CONNAUGHT PLACE

In the result, appeal of the Revenue vide ITA No

ITA 5031/DEL/2024[2015-16]Status: DisposedITAT Delhi09 Jan 2026AY 2015-16

Bench: Shri Anubhav Sharma & Shri Amitabh Shukla, Accountnat Member [Assessment Year: 2015-16] Assistant Commissioner Of Om Prakash Arora, Income Tax, Central Circle-01, M-3, Flat No.103, Avg Bhawan E-2, Jhandewalan Extn. Vs The Variety Books Depot. New Delhi-110055 Connaught Place, New Delhi-110001 Pan-Accpa9774F Assessee Revenue Cross Objection No.42/Del/2025 (Arising Out Of Ita No.5031/Del/2024) [Assessment Year: 2015-16] Om Prakash Arora, Assistant Commissioner Of Income M-3, Flat No.103, Avg Tax, Central Circle-01, Bhawan The Variety Books Vs E-2, Jhandewalan Extn. Depot. Connaught Place, New Delhi-110055 New Delhi-110001 Pan-Accpa9774F Assessee Revenue [Assessment Year: 2016-17] Assistant Commissioner Of Om Prakash Arora, Income Tax, Central Circle-01, M-3, Flat No.103, Avg Bhawan E-2, Jhandewalan Extn. Vs The Variety Books Depot. New Delhi-110055 Connaught Place, New Delhi-110001 Pan-Accpa9774F Assessee Revenue

Section 139(1)Section 143(3)Section 147Section 148Section 151

…t of the Hon'ble Supreme Court with regard to the colorable devices where transactions are sham and not genuine. The Hon'ble Supreme Court in Vodafone International (dated 20 January 2012) considered its decisions in the matters of McDowell reported in (1985) 3 SCC 230, Azadi Bachao reported in (2004) 10 SC 1 and the Mathuram Agarwal reported in (1999) 8 SC 667 and concluded that where the transaction is not genuine but a colourable device there could be no question of tax planning. Supreme Court makes it very clear that a colourable device cannot be a part of tax planning. k) Therefore where a transaction is sha…

ASSISSTANT COMMISSIONER OF INCOME TAX, JHANDEWALAN EXTN. vs. OM PRAKASH ARORA, CONNAUGHT PLACE

In the result, appeal of the Revenue vide ITA No

ITA 5029/DEL/2024[2016-17]Status: DisposedITAT Delhi09 Jan 2026AY 2016-17

Bench: Shri Anubhav Sharma & Shri Amitabh Shukla, Accountnat Member [Assessment Year: 2015-16] Assistant Commissioner Of Om Prakash Arora, Income Tax, Central Circle-01, M-3, Flat No.103, Avg Bhawan E-2, Jhandewalan Extn. Vs The Variety Books Depot. New Delhi-110055 Connaught Place, New Delhi-110001 Pan-Accpa9774F Assessee Revenue Cross Objection No.42/Del/2025 (Arising Out Of Ita No.5031/Del/2024) [Assessment Year: 2015-16] Om Prakash Arora, Assistant Commissioner Of Income M-3, Flat No.103, Avg Tax, Central Circle-01, Bhawan The Variety Books Vs E-2, Jhandewalan Extn. Depot. Connaught Place, New Delhi-110055 New Delhi-110001 Pan-Accpa9774F Assessee Revenue [Assessment Year: 2016-17] Assistant Commissioner Of Om Prakash Arora, Income Tax, Central Circle-01, M-3, Flat No.103, Avg Bhawan E-2, Jhandewalan Extn. Vs The Variety Books Depot. New Delhi-110055 Connaught Place, New Delhi-110001 Pan-Accpa9774F Assessee Revenue

Section 139(1)Section 143(3)Section 147Section 148Section 151

…t of the Hon'ble Supreme Court with regard to the colorable devices where transactions are sham and not genuine. The Hon'ble Supreme Court in Vodafone International (dated 20 January 2012) considered its decisions in the matters of McDowell reported in (1985) 3 SCC 230, Azadi Bachao reported in (2004) 10 SC 1 and the Mathuram Agarwal reported in (1999) 8 SC 667 and concluded that where the transaction is not genuine but a colourable device there could be no question of tax planning. Supreme Court makes it very clear that a colourable device cannot be a part of tax planning. k) Therefore where a transaction is sha…

M/S. NARAIN PROPERTIES LIMITED,KANPUR vs. ACIT-VI, KANPUR

In the result, the appeal of the assessee

ITA 354/LKW/2010[1997-98]Status: DisposedITAT Lucknow05 Jan 2026AY 1997-98

Bench: Shri Kul Bharat & Shri Anadee Nath Misshra

Section 143(3)Section 43(5)Section 45

…ns are behind creation of losses by internal sale and purchase of shares in one case or the other which is beyond reasoning from the view point of commercial expediency. Hon'ble Supreme Court in the landmark decision in the case of Mc. Dowell and Company Ltd. 154 ITR 148 applicable in such cases on colourable devices to defraud revenue. Further it is seen that this is a case of investment company where either gain or loss in sale of shares has to be assessed either as capital gain which is to be computed in view of provision of section 45 to 54 of 1.T. Act or capital loss which is not admissible at all. The ass…

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