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 367,181 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

Rashi Agrawal, Cuttacki vs. Income Tax Officer, Cuttack

In the result, appeal of the assessee allowed

ITA 56/CTK/2023[2014-15]Status: HeardITAT Cuttack04 May 2023AY 2014-15
For Appellant: Shri Keshav Dubey, CAFor Respondent: Shri S.C.Mohanty, Sr. DR
Section 10(38)

…has failed to substantiate the genuineness of alleged share transactions in respect of long term capital gain u/s. 10(38) of the Act. In view of above discussions, the landmark decision of the Hon‟ble Supreme Court in the case of McDowell and Company Limited, 154 ITR 148 are squarely applicable in this case wherein it has been held that tax planning may be legitimate provided it is within the framework of the law and any colourable devices cannot be part of tax planning...‟ d. Satish Kishore v. ITO, W-47(2), New Delhi [2019] 110 taxmann.com 307 (Delhi - Trib.). 6.4 When the documentary evidence containing contrac…

Maruti Tradexim Pvt. Ltd., New Delhi vs. ITO, Ward- 16(2), New Delhi

ITA 3615/DEL/2018[2012-13]Status: DisposedITAT Delhi26 Apr 2023AY 2012-13

Bench: Shri Shamim Yahya & Ms. Astha Chandraasstt. Year: 2012-13

For Appellant: NoneFor Respondent: Shri Anil Kumar Sharma, Sr. DR
Section 131Section 143(3)Section 68

…ju (TN) (1979) 120 ITR 46 (S.C) wherein it was held that- "One day, in our welfare state geared to social justice, this clever concept of 'avoid a against 'evasion' may have to be exposed”. 8.11 Hon'ble Supreme Court in the case of McDowell & Co. Ltd. (1985) 154 ITR 148 (S.C), wherein the Hon'ble Supreme Court has denounced tax avoidance, if not bonafide. The relevant part of the observation of the Hon'ble Supreme Court is reproduced hereunder: "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong 8 to encourage or entertain…

ACIT (Ltu-1), Mumbai vs. Bajaj Holdings & Investment Ltd, Mumbai

In the result, cross objection filed by the assessee is partly allowed

ITA 5030/MUM/2001[1997-98]Status: DisposedITAT Mumbai13 Apr 2023AY 1997-98

Bench: Shri Kuldip Singh, Hon’Ble & Shri S. Rifaur Rahman, Hon'Bleacit (Ltu-1) V. Bajaj Holdings Investment Ltd 29Th, Floor, Centre-1 226, Bajaj Bhavan, 2Nd Floor World Trade Centre Jamnalal Bajaj Marg, Nariman Point Mumbai- 400021 Cuffe Parade, Mumbai- 400075 Pan: Aaacb3370K (Appellant) (Respondent) C.O.No. 96/Mum/2002 [Arising Out Of Ita No.5030/Mum/2001 (A.Y: 1997-98)] Bhajaj Auto Limited V. Acit (Ltu-1) Bhajaj Bhavan 29Th, Floor, Centre-1 Nariman Point World Trade Centre Mumbai - 400020 Cuffe Parade, Mumbai- 400075 Pan: Aaacb3370K (Appellant) (Respondent) Assessee Represented By : Shri Percy Pardiwala& Ms. Vasanti Patel Department Represented By : Shri Rahul Kumar & Shri Vranda U Matkarri

Section 2(24)Section 35DSection 37(2)Section 80H

…sessee behind drafting the agreements between the assessee and the financial institution was to reduce the tax liability artificially of both the parties and as such the ratio of the decision of the hon'ble apexcourt in the case of McDowell Ltd. v, CTO [1985] 154 ITR 148 (SC) has wrongly been, interpreted" Page No.| 42 C.O.No. 96/MUM/2002 Bajaj Holdings Investment Ltd The Hon'ble High Court rejected the appeal of Revenue by holding as under: 3. "Only contention raised by the learned counsel for the Revenue is that the machinery was integral part of the bollers and the same continued to be with the assessee in sp…

ACIT - 21(2), Mumbai vs. Kalpana Shripal Morakhia, Mumbai

In the result, the appeal by the Revenue is dismissed

ITA 3003/MUM/2016[2010-11]Status: DisposedITAT Mumbai03 Apr 2023AY 2010-11

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: Shri Hiro RaiFor Respondent: Shri Sandeep Raj
Section 143(3)Section 250Section 54F

…laims made in the preceding 3 years have been regularly accepted in the scrutiny assessments made in her own case. 19. Now coming to the applicability of the decision of Supreme Court decision in the case Mc Dowell & Co. Ltd. vs. Commercial Tax officer (1985) 154 ITR 148(SC) to the facts of the instant case, I find that the observation of the AO that artificial loss in capital gain was created by the appellant was not correct. It is actual loss suffered by the appellant while subscribing to the shares of the company. In this regard, the appellant has relied upon a no. of judgments which touches on the core issue…

Asstt. Commissioner of Income -Tax 19(1), Mumbai vs. Munish Financial, Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 2638/MUM/2022[2015-2016]Status: DisposedITAT Mumbai31 Mar 2023AY 2015-2016

Bench: Shri S. Rifaur Rahman, Hon'Ble & Ms Kavitha Rajagopal, Hon'Ble

Section 143(1)Section 143(2)Section 69C

…IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “D”, MUMBAI BEFORE SHRI S. RIFAUR RAHMAN, HON'BLE ACCOUNTANT MEMBER AND MS KAVITHA RAJAGOPAL, HON'BLE JUDICIAL MEMBER ITA NOs. 2637 & 2638/MUM/2022 (A.Ys: 2014-15 & 2015-16) ACIT – 19(1) v. Munish Financial Room No. 203, Matru Mandir 11-A, 5th Floor Grant Road, Mumbai - 400007 Rockside Apartment, A-Wing Walkeshwar Road Walkeshwar, Mumbai - 400006 PAN: AAWFM3351J (Appellant) (Respondent) Assessee Represented by : Shri Suchek Anchaliya & Shri Tushar Nagori Department Represented by : Smt Mahita Nair Date of Hearing : 27.02.2023 Date of Pronouncement : 31.03.2023 O…

Asstt. Commissioner of Income -Tax 19(1), Mumbai vs. Munish Financial, Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 2637/MUM/2022[2014-2015]Status: DisposedITAT Mumbai31 Mar 2023AY 2014-2015

Bench: Shri S. Rifaur Rahman, Hon'Ble & Ms Kavitha Rajagopal, Hon'Ble

Section 143(1)Section 143(2)Section 69C

…IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “D”, MUMBAI BEFORE SHRI S. RIFAUR RAHMAN, HON'BLE ACCOUNTANT MEMBER AND MS KAVITHA RAJAGOPAL, HON'BLE JUDICIAL MEMBER ITA NOs. 2637 & 2638/MUM/2022 (A.Ys: 2014-15 & 2015-16) ACIT – 19(1) v. Munish Financial Room No. 203, Matru Mandir 11-A, 5th Floor Grant Road, Mumbai - 400007 Rockside Apartment, A-Wing Walkeshwar Road Walkeshwar, Mumbai - 400006 PAN: AAWFM3351J (Appellant) (Respondent) Assessee Represented by : Shri Suchek Anchaliya & Shri Tushar Nagori Department Represented by : Smt Mahita Nair Date of Hearing : 27.02.2023 Date of Pronouncement : 31.03.2023 O…

DCIT, Circle- 10(1), New Delhi vs. Global Fairs & Media Pvt. Ltd., Delhi

In the result, the appeal of the Revenue in ITA No

ITA 4317/DEL/2017[2012-13]Status: DisposedITAT Delhi29 Mar 2023AY 2012-13

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Shri KVSR Krishnan, AdvFor Respondent: Shri Anuj Garg, Sr. DR
Section 47

…ee and came to the conclusion that the assessee company has adopted baseless figures of free cash flows projection just to overvalue the goodwill purchased from TIEL. 10. Referring to the judgment of the Hon'ble Supreme Court in the case of McDowel & Co. Ltd 154 ITR 148, the Assessing Officer, while disallowing the claim of depreciation on goodwill, held that the assessee has used colourable devices to claim depreciation on goodwill. Accordingly, addition of Rs. 1,62,87,624/- was made. 11. The assessee strongly agitated the matter before the ld. CIT(A) and reiterated is claim of deprecation. 12. After consider…

Income Tax Officer, Ward- 3(1), Raipur vs. Harsha Rice Mills Private Limited, Raipur

In the result, both the appeals of the assessee and revenue are allowed for statistical purposes in terms of our aforesaid observations

ITA 170/RPR/2019[2014-15]Status: DisposedITAT Raipur28 Mar 2023AY 2014-15

Bench: Shri Ravish Sood & Shri G D Padmahshaliआयकर अपील सं. / Ita No.156/Rpr/2019 "नधा"रण वष" / Assessment Year : 2014-15 Harsha Rice Mills Pvt. Ltd. D-22, Sector-5, Devendra Nagar, Raipur (C.G.)-492 001 Pan : Aabch7123H .......अपीलाथ" / Appellant बनाम / V/S. The Income Tax Officer-3(1), Raipur (C.G.) ……""यथ" / Respondent आयकर अपील सं. / Ita No.170/Rpr/2019 "नधा"रण वष" / Assessment Year : 2014-15 The Income Tax Officer-3(1), Raipur (C.G.) .......अपीलाथ" / Appellant बनाम / V/S. Harsha Rice Mills Pvt. Ltd. D-22, Sector-5, Devendra Nagar, Raipur (C.G.)-492 001 Pan : Aabch7123H ……""यथ" / Respondent

For Appellant: Shri R.B Doshi, CAFor Respondent: None
Section 143(3)Section 250(4)

…the transaction as genuine? 4. "Whether on points of law and on facts & circumstances of the case, the Id. CIT(A) was justified in ignoring the ratio of the landmark decision of the Supreme Court in the case of McDowell and Co. Ltd. Vs Commercial Tax Officer 154 ITR 148 (SC), as the same ratio of this landmark decision is applicable to the facts and circumstances of the instant case of the assessee?" 5. "Whether on points of law and on facts & circumstances of the case, the ITAT was justified in giving a decision without discussing the issue on merits and without giving any cognizance to the decision of the Hon'…

Harsha Rice Mills Private Limited, Raipur vs. Income Tax Officer, Ward- 3(1), Raipur

In the result, both the appeals of the assessee and revenue are allowed for statistical purposes in terms of our aforesaid observations

ITA 156/RPR/2019[2014-15]Status: DisposedITAT Raipur28 Mar 2023AY 2014-15

Bench: Shri Ravish Sood & Shri G D Padmahshaliआयकर अपील सं. / Ita No.156/Rpr/2019 "नधा"रण वष" / Assessment Year : 2014-15 Harsha Rice Mills Pvt. Ltd. D-22, Sector-5, Devendra Nagar, Raipur (C.G.)-492 001 Pan : Aabch7123H .......अपीलाथ" / Appellant बनाम / V/S. The Income Tax Officer-3(1), Raipur (C.G.) ……""यथ" / Respondent आयकर अपील सं. / Ita No.170/Rpr/2019 "नधा"रण वष" / Assessment Year : 2014-15 The Income Tax Officer-3(1), Raipur (C.G.) .......अपीलाथ" / Appellant बनाम / V/S. Harsha Rice Mills Pvt. Ltd. D-22, Sector-5, Devendra Nagar, Raipur (C.G.)-492 001 Pan : Aabch7123H ……""यथ" / Respondent

For Appellant: Shri R.B Doshi, CAFor Respondent: None
Section 143(3)Section 250(4)

…the transaction as genuine? 4. "Whether on points of law and on facts & circumstances of the case, the Id. CIT(A) was justified in ignoring the ratio of the landmark decision of the Supreme Court in the case of McDowell and Co. Ltd. Vs Commercial Tax Officer 154 ITR 148 (SC), as the same ratio of this landmark decision is applicable to the facts and circumstances of the instant case of the assessee?" 5. "Whether on points of law and on facts & circumstances of the case, the ITAT was justified in giving a decision without discussing the issue on merits and without giving any cognizance to the decision of the Hon'…

DCIT 1(1)(2), Mumbai vs. Forbes & Company Ltd, Mumbai

In the result, the appeal is allowed for statistical purpose

ITA 4493/MUM/2017[2013-14]Status: DisposedITAT Mumbai20 Mar 2023AY 2013-14

Bench: Shir Pavan Kumar Gadale & Shri Gagan Goyal

For Appellant: Mr.Ketan Ved & Mr.AbdulkadirFor Respondent: Mr, Ankush Kapoor, CIT &
Section 143(1)Section 143(2)Section 14ASection 250Section 35A

…30 years and then paid a huge amount of money as compensation for the balance period out of the 30 year term to end the agreement. Supreme Court in Vodafone International dated 20.01.2012 considered its decisions in the matters of McDowell reported in (1985) 3 SCC 230, Azadi Bachao reported in (2004) 10 SCC 1 and the Mathuram Agarwal reported in (1999) 8 SSC 67 and concluded that where the transaction is not genuine but a colorable device there could be no Bench question of tax planning. The SC held that a sham and non-genuine transaction cannot be considered to be a part of tax planning or legitimate avoidance…

DCIT - 1 (1) (2), Mumbai vs. Forbes & Company Ltd., Mumbai

In the result, the appeal is allowed for statistical purpose

ITA 1002/MUM/2017[2010-11]Status: DisposedITAT Mumbai17 Mar 2023AY 2010-11

Bench: Shir Pavan Kumar Gadale & Shri Gagan Goyal

For Appellant: Mr.Ketan Ved & Mr.AbdulkadirFor Respondent: Mr, Ankush Kapoor, CIT &
Section 143(1)Section 143(2)Section 14ASection 250Section 35A

…30 years and then paid a huge amount of money as compensation for the balance period out of the 30 year term to end the agreement. Supreme Court in Vodafone International dated 20.01.2012 considered its decisions in the matters of McDowell reported in (1985) 3 SCC 230, Azadi Bachao reported in (2004) 10 SCC 1 and the Mathuram Agarwal reported in (1999) 8 SSC 67 and concluded that where the transaction is not genuine but a colorable device there could be no Bench question of tax planning. The SC held that a sham and non-genuine transaction cannot be considered to be a part of tax planning or legitimate avoidance…

Rachit V Shah, Hyderabad vs. ITO, Ward-7(3), Hyderabad

In the result, the appeal of the assessee is dismissed

ITA 420/HYD/2022[2015-16]Status: DisposedITAT Hyderabad15 Mar 2023AY 2015-16

Bench: Shri Rama Kanta Panda & Shri Laliet Kumar

For Appellant: Shri Sunil Kumar Jain, CAFor Respondent: Shri Kumar Adithya for Shri K.P.R.R.Murthy, Sr.AR
Section 142(1)Section 143(1)Section 143(3)Section 54F

…his books and can claim exemption u/s 54 of the Act without alienating himself from the property gifted. This action of the assessee is clearly a colourable device as envisaged in the case of the Mc Dowell and company Limited Vs commercial Tax officer (1985), 3 SCC 230, decided by Hon'ble supreme Court of India. This is elaborately discussed by the AO at para 11.1 of the Assessment order. Accordingly, I fully agree with the AO that the assessee has used 5 Rachit v. Shah a colourable device to claim exemption u/s 54F of the Act. Therefore, the ground of the appellant is dismissed. 6. Feeling aggrieved by the o…

M/S. Century Silicon City, Bangalore vs. DCIT, Circle-1(2)(1, Bangalore

In the result, the appeals of the assessees are allowed

ITA 1102/BANG/2022[2015-16]Status: DisposedITAT Bangalore10 Mar 2023AY 2015-16

Bench: Shri Chandra Poojari & Shri Anikesh Banerjee

For Appellant: Smt. Sheetal Borkar, A.RFor Respondent: Shri K. Sankar Ganesh, D.R
Section 143(3)

…The ld. CIT(A) observed that the distinction between legitimate tax planning and use of colourable devices has been summed up by Hon'ble Supreme Court, in the landmark judgement delivered by five-judge bench in case of Mc Dowell and Company Ltd Vs CTO (1985) (154 ITR 148) (SC), in following words (per the judgement authored by Justice Ranganath Misra), - "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious methods.…

M/S. Century Silicon City, Bangalore vs. DCIT, Circle-1(2)(1, Bangalore

In the result, the appeals of the assessees are allowed

ITA 1101/BANG/2022[2014-15]Status: DisposedITAT Bangalore10 Mar 2023AY 2014-15

Bench: Shri Chandra Poojari & Shri Anikesh Banerjee

For Appellant: Smt. Sheetal Borkar, A.RFor Respondent: Shri K. Sankar Ganesh, D.R
Section 143(3)

…The ld. CIT(A) observed that the distinction between legitimate tax planning and use of colourable devices has been summed up by Hon'ble Supreme Court, in the landmark judgement delivered by five-judge bench in case of Mc Dowell and Company Ltd Vs CTO (1985) (154 ITR 148) (SC), in following words (per the judgement authored by Justice Ranganath Misra), - "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious methods.…

M/S. Century Silicon City, Bangalore vs. DCIT, Circle-1(2)(1, Bangalore

In the result, the appeals of the assessees are allowed

ITA 1100/BANG/2022[2013-14]Status: DisposedITAT Bangalore10 Mar 2023AY 2013-14

Bench: Shri Chandra Poojari & Shri Anikesh Banerjee

For Appellant: Smt. Sheetal Borkar, A.RFor Respondent: Shri K. Sankar Ganesh, D.R
Section 143(3)

…The ld. CIT(A) observed that the distinction between legitimate tax planning and use of colourable devices has been summed up by Hon'ble Supreme Court, in the landmark judgement delivered by five-judge bench in case of Mc Dowell and Company Ltd Vs CTO (1985) (154 ITR 148) (SC), in following words (per the judgement authored by Justice Ranganath Misra), - "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious methods.…

Century Sheltors, Bangalore vs. ACIT, Circle-2(2), Bangalore

In the result, the appeals of the assessees are allowed

ITA 1075/BANG/2022[2015-16]Status: DisposedITAT Bangalore10 Mar 2023AY 2015-16

Bench: Shri Chandra Poojari & Shri Anikesh Banerjee

For Appellant: Smt. Sheetal Borkar, A.RFor Respondent: Shri K. Sankar Ganesh, D.R
Section 143(3)

…The ld. CIT(A) observed that the distinction between legitimate tax planning and use of colourable devices has been summed up by Hon'ble Supreme Court, in the landmark judgement delivered by five-judge bench in case of Mc Dowell and Company Ltd Vs CTO (1985) (154 ITR 148) (SC), in following words (per the judgement authored by Justice Ranganath Misra), - "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious methods.…

Century Sheltors, Bangalore vs. ACIT, Circle-2(2), Bangalore

In the result, the appeals of the assessees are allowed

ITA 1074/BANG/2022[2014-15]Status: DisposedITAT Bangalore10 Mar 2023AY 2014-15

Bench: Shri Chandra Poojari & Shri Anikesh Banerjee

For Appellant: Smt. Sheetal Borkar, A.RFor Respondent: Shri K. Sankar Ganesh, D.R
Section 143(3)

…The ld. CIT(A) observed that the distinction between legitimate tax planning and use of colourable devices has been summed up by Hon'ble Supreme Court, in the landmark judgement delivered by five-judge bench in case of Mc Dowell and Company Ltd Vs CTO (1985) (154 ITR 148) (SC), in following words (per the judgement authored by Justice Ranganath Misra), - "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious methods.…

Century Sheltors, Bangalore vs. ACIT, Circle-2(2), Bangalore

In the result, the appeals of the assessees are allowed

ITA 1073/BANG/2022[2013-14]Status: DisposedITAT Bangalore10 Mar 2023AY 2013-14

Bench: Shri Chandra Poojari & Shri Anikesh Banerjee

For Appellant: Smt. Sheetal Borkar, A.RFor Respondent: Shri K. Sankar Ganesh, D.R
Section 143(3)

…The ld. CIT(A) observed that the distinction between legitimate tax planning and use of colourable devices has been summed up by Hon'ble Supreme Court, in the landmark judgement delivered by five-judge bench in case of Mc Dowell and Company Ltd Vs CTO (1985) (154 ITR 148) (SC), in following words (per the judgement authored by Justice Ranganath Misra), - "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious methods.…

Jatin Garg & Sons (HUF), New Delhi vs. ITO, Ward-36(5), New Delhi

Appeal of the assessee is dismissed

ITA 5652/DEL/2018[2015-16]Status: DisposedITAT Delhi07 Mar 2023AY 2015-16

Bench: Shri Kul Bharat

Section 143(2)Section 68

…order dated 04.1.2019 Hon'ble ITAT, Banglore in the case ofSmt M K Rajeshwari Rajkumar B Aggarwal Vs ITO 99 Taxmann.com 339 order dated 12.10.2018. Hon'ble Supremet Court in Sumati Dayal Vs CIT [214 ITR 801 Hon'ble Supremet Court in Mcdowell & Co. Ltd [1985) 154 ITR 148[SC]. Since the shares were purchased from off market and in physical form, therefore, not in conformity with SEBI Guidelines and the payments for purchase was also made in cash and the assessee was not a regular investor in shares, the AO rightly rejected the claim of exempt long term capital gain u/s 10[38] and made addition U/S 68, holding that…

Girdharbhai Haribhai Gajera, Surat vs. ITO(International Taxation), Surat

In the result, additional grounds raised by the assessee is allowed

ITA 143/SRT/2019[2015-16]Status: DisposedITAT Surat22 Feb 2023AY 2015-16

Bench: Shri Pawan Singh, Jm &Dr. A.L.Saini, Am आयकर अपील सं./Ita No.143/Srt/2019 (िनधा"रणवष" / Assessment Year: (2015-16) (Physical Court Hearing) Girdharbhai Haribhai Gajera Income Tax Officer 1,Vrushal Nagar, Opp. (International Taxation), 107, 1St Vs. Ktargam Police Station, Floor, Anavil Business Centre, Katargam Road, Surat-35004 Adajan-Hazira Road, Opp. Star Bazar, Adajan, Surat-395009 "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Abepg 7339 M (Assessee ) (Respondent)

For Appellant: Shri Hiren R.Vepari, C.AFor Respondent: Shri Vinod Kumar, Sr-D.R
Section 142(1)Section 143(2)Section 143(3)Section 2(14)Section 271Section 45(2)

…only shareholders being K.K’s wife and R. Capital of assessees in share business stood substantially reduced after transaction in question was over – Whether all transactions question being by interested parties, principles of McDowell &Co. Ltd vs. CTO [1985] 154 ITR 148 (SC) were attracted to facts and transaction being colourable device to avoid tax arising on capital gains, Assessing Officer was right in brining gains to capital gains tax -Held, yes. Reliance is also placed on ratio of decision of Hon'ble Allahabad High Court in the case of CIT Vs. Carlton Hotel (P.) Ltd. [2017] 88 taxmann.com 257 wherein it i…