https://www.taxtmi.com/caselaws?id=216284 A scheme of arrangement under sections 391 to 394 of the Companies Act, 1956 was upheld where the court found it to be a bona fide commercial restructuring of telecom infrastructure and services. The Income-tax Department was entitled to object as a creditor for its subsisting revenue claim, but the objection failed on merits. The scheme was not treated as a colourable device or a sham merely because it could produce tax benefits, and the absence of monetary consideration did not invalidate it because the restructuring involved reciprocal commercial advantages. The appellate court sanctioned the scheme while preserving the revenue authorities' right to recover existing or past tax liabilities in accordance with law. en-us Mon, 27 Aug 2012 00:00:00 +0530 Sat, 29 Jun 2013 10:33:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=216284 A scheme of arrangement under sections 391 to 394 of the Companies Act, 1956 was upheld where the court found it to be a bona fide commercial restructuring of telecom infrastructure and services. The Income-tax Department was entitled to object as a creditor for its subsisting revenue claim, but the objection failed on merits. The scheme was not treated as a colourable device or a sham merely because it could produce tax benefits, and the absence of monetary consideration did not invalidate it because the restructuring involved reciprocal commercial advantages. The appellate court sanctioned the scheme while preserving the revenue authorities' right to recover existing or past tax liabilities in accordance with law. Case-Laws Income Tax Mon, 27 Aug 2012 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=216284