Kapish Hariprasad Poddar Vs ITO (ITAT Nagpur)
Summary: The Income Tax Appellate Tribunal, Nagpur, disposed of two appeals filed by the respective assessees for Assessment Year 2024-25 concerning denial of rebate under Section 87A of the Income-tax Act, 1961 on short-term capital gain included in total income. ITA No. 406/NAG/2026 was directed against the order dated 24.02.2026 framed by the National Faceless Appeal Centre, Delhi (NFAC), arising from the assessment order dated 24.06.2025 passed under Section 143(3) of the Act. ITA No. 414/NAG/2026 was directed against the order dated 17.02.2026 framed by Addl./JCIT(A)-1, Delhi, arising from the assessment order dated 11.09.2025 passed under Section 143(3). In both cases, the assessees had claimed rebate under Section 87A in their returns where total income included short-term capital gain, but the CPC denied the rebate on such short-term capital gain. The Tribunal considered the judicial precedents placed in the assessee’s paper book and particularly followed Pushpa Prakash Misar vs. ITO, ITA No. 741/MUM/2026, order dated 23.03.2026 for AY 2024-25. In that decision, it was held, on a plain reading of the statutory provisions, that there was no express bar either in Section 87A or Section 111A for denial of rebate under Section 87A in respect of tax payable on short-term capital gain arising from transfer of listed equity shares taxable at the special rate under Section 111A. Respectfully following that judicial precedent, the Nagpur Tribunal directed the respective Jurisdictional Assessing Officers to grant the rebate under Section 87A claimed by the assessees. The grounds raised in both appeals were accordingly allowed, and both appeals were allowed. The order was pronounced on 7 August 2026. The issue concerns the interaction between Section 87A and Section 111A for AY 2024-25.
Cases Discussed
- Pushpa Prakash Misar vs. ITO (ITAT Mumbai), ITA No. 741/MUM/2026, order dated 23.03.2026 for Assessment Year 2024-25.
FULL TEXT OF THE ORDER OF ITAT NAGPUR
ITA No.406/NAG/2026 at the instance of assessee pertaining to A.Y. 2024-25 is directed against the order dated 24.02.2026 framed by National Faceless Appeal Centre, Delhi (NFAC) arising out of Assessment Order dated 24.06.2025 passed u/s. 143(3) of the Income Tax Act, 1961 (in short ‘the Act’). ITA No.414/NAG/2026 at the instance of assessee pertaining to A.Y. 2024-25 is directed against the order dated 17.02.2026 framed by Addl / JCIT(A)-1, Delhi arising out of Assessment Order dated 11.09.2025 passed u/s. 143(3) of the Income Tax Act, 1961 (in short ‘the Act’).
2. The common grievance in both these appeals is denial of rebate u/s 87A on the short term capital gain included in the total income.
3. I have heard the rival contentions and perused the record placed before me. I note that both the assessees in the instant case have claimed for rebate u/s 87A in the return of income, the total income which includes income from short term capital gain. However, the CPC has denied the rebate u/s 87A on the short term capital gain.
4. I have gone through the judicial precedents filed in the paper book by the assessee. Taking into note of the decision of the Mumbai Bench of the Tribunal in the case of Pushpa Prakash Misar vs. ITO vide ITA No.741/MUM/2026 order dated 23.03.2026 for assessment year 2024-25 where also it has been held that on a plain reading of statutory provisions, there exists no express bar either in section 87A or section 111A for denial of rebate u/s 87A of the Act in respect of tax payable on Short Term Capital Gain arising from transfer of listed equity shares taxable at special rate u/s. 111A. Respectfully following the said judicial precedent, I direct the respective Jurisdictional Assessing Officers to grant the rebate u/s 87A of the Act claimed by the assessee(s). The grounds of appeal raised by both the assessees are accordingly allowed.
5. In the result, both the appeals of the respective assessee(s) are allowed.
Order pronounced on this 7th day of August, 2026.
