Seshank Mahadev Vs ITO (ITAT Chennai)
The assessee appealed against the order dated 02.06.2025 passed by the Addl./JCIT(A), Indore for Assessment Year 2024-25.
The CPC had denied the assessee’s claim for rebate under Section 87A of the Income-tax Act, 1961 through an intimation under Section 143(1) dated 12.11.2024. The assessee’s appeal before the Addl./JCIT(A)-1, Mumbai was dismissed by an order dated 12.02.2025 under Section 250, confirming the CPC’s rejection of the rebate claim. Thereafter, the assessee filed another appeal before the Addl./JCIT(A), Indore, who, by order dated 02.06.2025, dismissed the appeal, holding that the appellate order passed by the Addl./JCIT(A), Mumbai could not be entertained and that any further appeal lay before the higher appellate forum. The assessee then filed the present appeal before the ITAT.
Before the CIT(A), the assessee had contended that the rebate under Section 87A was available under the new tax regime under Section 115BAC. The CIT(A) rejected this contention, holding that income taxable under Sections 111A and 112A is chargeable at special rates and, therefore, the assessee was not eligible for rebate under Section 115BAC.
Before the Tribunal, the assessee relied upon the order of the ITAT Ahmedabad Benches in Jayshreeben Jayantibhai Palsana v. ITO, ITA No. 1014/Ahd/2025 for AY 2024-25, dated 12.08.2025. The Tribunal noted the observations in that decision that the statute does not distinguish between normal income and income chargeable at special rates and does not contain any express exclusion restricting rebate under Section 87A with reference to Sections 111A and 112A. The decision also held that the amended first proviso to Section 87A applies to a resident individual whose total income does not exceed ₹7,00,000 and who is assessed under Section 115BAC(1A). It further observed that neither Section 87A nor Section 111A expressly bars rebate in respect of tax payable on short-term capital gains taxable under Section 111A.
