Veenaben Arvindbhai Shah Vs Centralised Processing Center (ITAT Ahmedabad)
The assessee appealed against the order dated 27.11.2025 passed by the Commissioner of Income Tax (Appeals), Raipur, for Assessment Year 2024-25. The dispute concerned the denial of rebate under Section 87A of the Income-tax Act, 1961 while processing the return under Section 143(1), in respect of tax payable under Section 112 on long-term capital gains arising from the sale of a residential flat.
The assessee filed the original return of income on 27.07.2024 and a revised return on 23.11.2024, declaring total income of ₹4,22,913 without any change. The total income included long-term capital gains of ₹2,64,000 from the sale of a residential flat, taxable under Section 112 of the Act. The tax liability on the total income was ₹24,583. The assessee did not exercise the option under Section 115BAC(6) and was governed by Section 115BAC(1A). Since the total income did not exceed ₹7,00,000, the assessee claimed rebate under Section 87A against the entire tax liability and consequently claimed refund of TDS amounting to ₹8,203. While processing the revised return under Section 143(1), the Centralised Processing Centre (CPC) disallowed the rebate of ₹24,583, denied the refund claimed by the assessee and instead raised a demand of ₹17,360 without assigning reasons for the disallowance.
