“buyback of shares”

Capital GainsSection 46A / 115QASection 46A / 115QA51 judgments

The decision most relied on for buyback of shares is Pentamedia Graphics Ltd. v. ITO (236 CTR 204), cited in 17 judgments on BharatTax.

Leading authorities on buyback of shares

Pentamedia Graphics Ltd. v. ITO

236 CTR 204 · 2011 · High Court

citing judgments

Once a scheme of arrangement is approved by a court and is within the bounds of the law, it is binding on tax authorities.

Principal Commissioner of Income Tax v. Bayer Vapi (P.) Ltd.

106 Taxmann.com 395 · 2019 · High Court

citing judgments

Buyback of its own shares by a company is neither capital expenditure nor does it result in enduring benefits to the company. The consideration of non-deduction of TDS, which was evident from Form 3CD and not considered in the original assessment order, is not a change of opinion for reopening.

CIT v. Selan Exploration Technology Ltd.

188 Taxmann 1 · 2010 · High Court

citing judgments

Expenses incurred for buyback of shares are an allowable business expense for the purpose of computation of income. Such expenditure is not in the nature of capital expenditure and is not required to be capitalised.

Vora Financial Services (P) Ltd. v. ACIT

96 Taxmann.com 88 · 2018 · ITAT

citing judgments

Shares bought back by a company are not considered the property of the assessee for the purpose of Section 56(2)(viia), as a company cannot hold its own shares as property.

Judgments citing buyback of shares

Kismet Exports & Investments Pvt Ltd, Mumbai vs. DCIT 12(3)(1), Mumbai

In the result, the appeal of the assesseeITA No

ITA 7320/MUM/2019[2013-14]Status: DisposedITAT Mumbai27 Oct 2022AY 2013-14

Bench: Shri Pramod Kumar & Sh. Anikesh Banerjee

Section 143(3)Section 195Section 250(6)Section 37Section 37(1)Section 40Section 57

fact that Section 115QA was not applicable to the appellant company cannot be ruled out on a false surmise that the buyback of shares was devised for tax evasion. The Appellant Company craves leave to add, alter or amend the Grounds of Appeal at or before the hearing ... assessee the fact that section 115QA was not applicable to the appellant company cannot be ruled out and false summarize that the buyback of shares was devised for tax evasion. I.T.A. No. 7320/Mum/2019 8 2.5. Being aggrieved assessee filed an appeal before us. Adjudication of Ground

Sujan Azad Parikh, Mumbai vs. Dy CIT, CC-7(1), Mumbai

In the result, appeal of the assessee is allowed

ITA 186/MUM/2021[2007-08]Status: DisposedITAT Mumbai13 Jul 2022AY 2007-08

Bench: Shri Aby T. Varkey, Hon'Ble & Shri S. Rifaur Rahman, Hon'Blesujan Azad Parikh V. Dcit – 7(1) C-701, Beaumonde Tower Room No. 653, 6Th Floor Appasaheb Marathe Marg Aayakar Bhavan, M.K. Road Prabhadevi, Mumbai -400025 Mumbai - 400020 Pan: Aaepp9028R (Appellant) (Respondent) Assessee By : Shri Hariom Tulsiyan Department By : Shri B.K. Bagchi

For Appellant: Shri Hariom TulsiyanFor Respondent: Shri B.K. Bagchi

Section 139Section 143(3)Section 54F

appellant received many other benefits drawn by it along- with its group members. The Company NPCL has treated this selling of shares as buyback of shares which is akin to a normal equity sale / purchase transaction. Further. the appellant has failed to file the petition submitted by it before ... contention of the Ld. CIT(A) is concerned that the aforesaid sale of share by the appellant was an arrangement for buyback of shares. the same is completely incorrect since the buyback of shares, of the appellant by NPCL was optional and only one of means of concluding the settlement

ACIT 13 (3)(2), Mumbai vs. Vyapar Industries Ltd., Mumbai

In the result, both the appeals of the Revenue are allowed for statistical purposes

ITA 7159/MUM/2019[2011-12]Status: DisposedITAT Mumbai31 Mar 2022AY 2011-12

Bench: Shri Om Prakash Kant () & Shri Amarjit Singh () Assessment Year: 2011-12 & Assessment Year: 2014-15

For Appellant: Mr. Satyapraksh Singh, ARFor Respondent: Mr. Achal Sharma, CIT-DR

Section 106Section 132Section 143(3)Section 150Section 153ASection 153CSection 292C

financial year 2013-14, on account of conversion of GDRs into shares during financial year 2010-11 and purchase of shares under “ buyback of shares by promoters scheme “ approved by the SEBI during financial year 2013-14, however that does not mean that these transactions were undertaken by the assessee

Givaundan(India) Pvt. Ltd., Bangalore vs. ACIT, Ltu Cr 1, Bangalore

In the result the appeal filed by assessee stands allowed for statistical purposes

ITA 229/BANG/2015[2010-2011]Status: DisposedITAT Bangalore29 Mar 2022AY 2010-2011

Bench: Shri. B.R. Baskaran & Smt. Beena Pillaiit(Tp)A No. 229/Bang/2015 Assessment Year : 2010-11 M/S. Givaudan (India) The Assistant Pvt. Ltd., Commissioner Of Plot No. 26, 2Nd Cross, Income Tax, Jigani Industrial Area, Ltu, Bangalore – 562 106. Circle – 1, Vs. Pan: Aaacv7454J Bangalore. Appellant Respondent Assessee By : Shri Sumeet Khurana, Ca : Shri Sumer Singh Meena, Cit- Revenue By I Date Of Hearing : 11-01-2022 Date Of Pronouncement : 29-03-2022 Order Per Beena Pillaiit Is Submitted That The Main Appeal Was Heard By This Tribunal & Order Was Passed On 02/08/2019. However Grounds 6 & 7 Were Not Adjudicated Independently For Assessment Year 2010- 11. The Assessee Preferred Mp No.15/Bang/2020 Requesting For Adjudication Of These Grounds. 2. Accordingly The Present Appeal Is Fixed For Hearing For Adjudication Of Following Grounds: “6. That The Learned Ao & The Learned Panel Erred Both In Facts & Law In Confirming The Action Of The Learned Tpo Of Making An Adjustment To The Transfer Price Of The Appellant In Respect Of The Payment Of Royalty By Rs.27,67,42,242, Holding That The International Transaction

For Appellant: Shri Sumeet Khurana, CA

learned Panel erred both in facts and law in confirming the action of the learned TPO of considering the amount paid for buyback of shares as international transaction for making an adjustment of INR 151,256,201 to the transfer price of the Appellant, and in doing so grossly erred ... relevant transfer pricing methodology as on the date of the buyback. 7.3. Levying penalty for non-reporting of the alleged international transaction of buyback of shares in the Form 3CEB of the Appellant for the year, when based on the provisions of law as on the date of filing

Asst CIT (Ltu) 2, Mumbai vs. Asian Paints Ltd, Mumbai

In the result, appeal filed by the assessee is partly allowed as directed above

ITA 4675/MUM/2015[2010-11]Status: DisposedITAT Mumbai23 Feb 2022AY 2010-11

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm Asst. Commissioner Income Asian Paints Ltd. Tax, (Large Taxpayer Unit)-2, 6A Shanti Nagar, Cuffe Parade,, 29 Th Floor, Santacruz (East), World Trade Centre, Cuffee Mumbai-400 055 Vs. Parade, Mumbai-400 005 (Respondent) (Appellant) Pan No. Aaaca3622K Asian Paints Ltd. Vs. Addl. Commissioner Of 6A Shanti Nagar, Income Tax-Ltu Cuffe Parade,, 29 Th Floor, Santacruz (East), Mumbai-400 055 World Trade Centre, Cuffee Parade, Mumbai-400 005 (Appellant) (Respondent) Appellant By : Shri Milind Chavan, Sr Dr Respondent By : Shri Madhur Agrawal, Advocate Date Of Hearing: 09.12.2021 Date Of Pronouncement : 23.02 .2022 O R D E R Per Prashant Maharishi, Am: 01. These Are Cross Appeals Filed By Asian Paints Ltd [Appellant/Assessee] & The Additional Commissioner Of Income Tax – Large Taxpayers Unit

For Appellant: Shri Milind Chavan, Sr DRFor Respondent: Shri

Section 14ASection 35

learned Commissioner of Income Tax (Appeals) -55, Mumbai erred in disallowing claim for Long-term capital loss arising on account of buyback of shares amounting to Rs. 885.23 lacs on being transfer-pricing adjustment. 3) The learned Commissioner of Income Tax (Appeals) -55, Mumbai erred in applying Rule 8D & confirming ... respect of guarantee, (2) ₹ 1,131,136/– in respect of letter of comfort and (3) ₹ 88,523,100/– in respect of buyback of shares. 05. The learned assessing officer incorporated the above adjustment and further held that as assessee has claimed long-term capital loss

ITO, TDS, Ward- 1(1)(2), New Delhi vs. Bhartiya Urban Infrastructure and Land Development, New Delhi

In the result the appeal of the Revenue in ITA

ITA 5559/DEL/2017[2014-15]Status: DisposedITAT Delhi11 Oct 2021AY 2014-15

Bench: Shri N.K. Billaiya & Shri Amit Shukla[Assessment Year: 2014-15]

For Appellant: Shri Amit Goyal, AdvFor Respondent: Shri Gangadhar Panda, CIT- DR

Section 13(4)Section 133(6)Section 195(2)Section 197(1)Section 201Section 201(1)

erred in holding that the assessee was not required to deduct tax at source on the remittance to IIRF Holdings XVI Ltd. towards buyback of shares. 1.2 That in the facts and circumstances of the case, and in law, the Ld. CIT(A) erred in holding that the assessee ... required to deduct tax at source on the remittance to IIRF Holdings XVI Ltd. towards buyback of shares, without following the decision of the Hon’ble ITAT (Bangalore) in Fidelity Business Services India Pvt. Ltd. (I.T.(T.P.)A. No.416/Bang/2016), and without considering that the assessee had not established that

Genpact India, Gurugram vs. DCIT, Circle- 10(1), New Delhi

In the result, both, the appeal filed by the Revenue in ITA No

ITA 472/DEL/2018[2014-15]Status: DisposedITAT Delhi01 Sept 2021AY 2014-15

Bench: Shri N.K. Billaiya & Shri Kuldip Singh

For Appellant: Shri Sachit Jolly, AdvFor Respondent: Ms Sunita Singh, CIT- DR

Section 115Section 115QSection 143Section 246Section 391Section 77

India Investment, Mauritius („GII‟) in two phases in May and October, 2013. The case of the Revenue was that the scheme adopted to buyback such shares was a colourable device to evade „buyback distribution tax liability‟ under the Act. The case of the Assessee on the other hand was that ... buyback of shares was pursuant to a scheme of arrangement under Section 391 of the Companies Act, 1956 („CA‟) approved by the High Court of Delhi. This would, therefore, not be a „buyback‟ under Section 77-A CA for the purposes of Section 115QA of the Act, as it stood

DCIT, Circle-10(1), New Delhi vs. Genpact India, Delhi

In the result, both, the appeal filed by the Revenue in ITA No

ITA 379/DEL/2018[2014-15]Status: DisposedITAT Delhi01 Sept 2021AY 2014-15

Bench: Shri N.K. Billaiya & Shri Kuldip Singh

For Appellant: Shri Sachit Jolly, AdvFor Respondent: Ms Sunita Singh, CIT- DR

Section 115Section 115QSection 143Section 246Section 391Section 77

DCIT, New Delhi vs. M/S. Paramount Communication Pvt. Ltd., New Delhi

In the result, ITA No.767/Del/2014 is partly allowed,

ITA 2288/DEL/2017[2010-11]Status: DisposedITAT Delhi15 Jun 2021AY 2010-11

Bench: Shri R.K. Panda & Ms. Suchitra Kamble[Assessment Year: 2009-10]

Section 43A

assessee for raising funds are special bonds having an inbuilt option of conversion into equity at a premium.  Buyback of FCCBs is not buyback of shares. Buyback has been made by obtaining loan from Indian bank. Interest and finance charges have been charged to the profit and loss account.  During

Paramount Communications Ltd., New Delhi vs. DCIT, New Delhi

In the result, ITA No.767/Del/2014 is partly allowed,

ITA 1378/DEL/2017[2010-11]Status: DisposedITAT Delhi15 Jun 2021AY 2010-11

Bench: Shri R.K. Panda & Ms. Suchitra Kamble[Assessment Year: 2009-10]

Section 43A

M/S. Paramount Communictions Ltd., New Delhi vs. DCIT, New Delhi

In the result, ITA No.767/Del/2014 is partly allowed,

ITA 767/DEL/2014[2009-10]Status: DisposedITAT Delhi15 Jun 2021AY 2009-10

Bench: Shri R.K. Panda & Ms. Suchitra Kamble[Assessment Year: 2009-10]

Section 43A