Deemed dividend
Regulation & taxA receipt the income-tax law treats as a dividend although it does not arise from an ordinary declaration — including, for buybacks from 1 October 2024, the whole consideration a shareholder receives on tendering shares.
In plain terms
The head of income decides what you keep. The entire amount is taxed at your slab rate rather than the gain at the equity rate, and the cost of the shares is not set against it — it becomes a capital loss in a different part of the return.