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ThynkTax /Tax Reference /Case Laws /McDowell & Co.

McDowell & Co.

Supreme Court of India·1985·ITR
Facts

Manipulation of excise duty payment timing to claim deductions.

Issue

Whether tax planning that exploits literal interpretation but defeats legislative intent is permissible?

Held

Tax avoidance through colourable devices is not permitted; substance over form applies.

Ratio

This judgment introduced the doctrine of substance over form into Indian tax law. (Later refined by Azadi Bachao and Vodafone.)

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