This is guided by the following beautiful judicial principles laid down by Hon`ble Supreme Court of India.

An assessee can so arrange his affairs as to minimise his tax burden. (91 ITR 8 SC)

Avoidance of tax liability by so arranging commercial affairs that charge of tax is distributed is not prohibited. A taxpayer may resort to a device to divert the income before it accrues or arises to him. Effectiveness of device depends not upon consideration of morality, but on the operation of the Income Tax Act. (67 ITR 11 SC)

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