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@ Ou Ai & IPO Mitra are profoundly knowledgeable persons in this subject.
I want to put some points for reconciliation.
1. Buyback avenue is used by many companies for manipulation of share price by creating a hype. Buying 1 - 1.5% of shares does not change the ground situation to a great extent. If the company wishes to equitable distribution of some fund in hand , it should take recouse to dividend. What is said hitherto does not apply to big and renouned companies like TCS, Infosys etc. Here it is to be seen as benefits to shareholders envisaged primarily for the long term holders but some opportunistic investors will flock to take the opportunity given to the retail holders who will hit and fly. So the idea that the long term holders will fly with this little benefit is not confirmed by thier behavioural pattern as is seen in earlier occasions. Nor some quarter's results can subside the fancy of such persons though there may be some minor melting.
2. What is the benefit we are actually running for?
It is about Rs 49 per share + tax about Rs 10 , So about Rs 59 outlay of the company . For retailers some additional benefits for extra acceptance.
3. The company could have paid dividend @ 59 using the same money , tax to be paid by the recipient. Payment of dividend reduces the book value and market value instantly , so it may be thought to be a partial realisation of the share but people forget it and though the book value does not repair until further addition of profits etc market value repairs and goes up.
4. In case of buyback, the persons who tender fly off with the available benefit but those who do not tender gets the benefit in the form of stake appreciation by increased book value,eps , perceived market value ,lower number of shares.
5.As to tax benefit, in case of tendering in buyback the exemption benefit is limited to buyback price less recorded price .Taxation on other parts that is recorded price less cost of acquisition (w.r.t grandfathering clause sec 112 if applicable ) remains as usual. So in this case if the recorded price is 4000 , tax is to be paid on 4000 minus cost of acquisition. This is a good benefit. If the person does not tender in buyback but sells after some time at 4500, full tax is chargeable.
Now long term holders if does not tender will hold the benefit of grandfathering clause and LTCG . If they sell and reenter may attract STCG.
6. As to grandfathering , closing price as on 31/01/2018 was about Rs3100 for the original holding which is protected. For bonus share issued thereafter 1:1 in May 2018 will be fully taxed (overall Ltcg exemption one lac) with cost of acquisition zero.
7. Those who enter only for buyback, should keep in mind that the ultimate gain or loss will depend on the entry price besides the AR .From declaration to ex-date minus 1, there are atleast five disceet phase of prices , the first one for trading and there after positioal trading and with the trading accumulation at convenient points.Alternately one may start buying in ones and twos after the initial dust is settled and wait for dip which is most likely to come by.
In this case dip may be extended to 3700 and even lower to 3600 in odd circumstances.
So calculated and patient approach is required to extract the best.
Thanks

Very nice explanation. One thing hit me that we may still need to pay tax on buyback gain based on price on record date and cost of acquisition. This is something new to me, and worry it will make tax computation little more complex.

I too have accumulated but i am impatience person and do in one go. Once i have added fund and that causes higher buy price. One account is full with 46 for another bought 20 today @3694. Don't know why i hurry so much every time and only think that price will go up the moment i add fund 😒

@ Investormahesh
Yes , They are correct if buyback tax is paid @ 23.2% on the whole outgo by the company which is most likely in view of the reason mentioned by you.
The matter stands as follows :-
1. Company has once paid tax while the profit is made.
2. Now in buyback , per bought back share a tax of Rs 1044 is to be paid by the company.
If a person buys at zero and sell at 4500, maximum capital gain tax may be 675.( without assuming any exemption clause.

So the real beneficiary is the Govt and those you have mentioned.
In this budget you may see some change in this matter especially in case of open market buyback where in addition tax is to be paid by the shareholder also.