The Delhi High Court has ruled that share buybacks by companies at prices below fair market value do not qualify as taxable income. This ruling, made by Justices Dinesh Mehta and Vinod Kumar, upholds an earlier decision by the Income Tax Appellate Tribunal in a case involving the brokerage firm Globe Capital Market. The court rejected the Income Tax Department's argument that such buybacks generate profit or deemed profit, stating that this view is flawed. Senior Supreme Court lawyer Tarun Gulati praised the judgment, noting that it clarifies that buybacks are a form of capital restructuring rather than asset acquisition. The court highlighted that once shares are bought back, they are extinguished, thus no profit can be taxed. This ruling is expected to significantly alleviate costs for companies considering share buybacks.