Income-tax Act, 1961

Impermissible avoidance arrangement.

96. (1)An impermissible avoidance arrangement means an arrangement, the main purpose of which is to obtain a tax benefit, and it-

(a)	-	creates rights, or obligations, which are not ordinarily created between persons dealing at arm's length;
(b)	-	results, directly or indirectly, in the misuse, or abuse, of the provisions of this Act;
(c)	-	lacks commercial substance or is deemed to lack commercial substance under section 97, in whole or in part; or
(d)	-	is entered into, or carried out, by means, or in a manner, which are not ordinarily employed for bona fide purposes.

(2) An arrangement shall be presumed, unless it is proved to the contrary by the assessee, to have been entered into, or carried out, for the main purpose of obtaining a tax benefit, if the main purpose of a step in, .... To read the full section download the app from Google Play store