The Income Tax Appellate Tribunal, Jaipur Bench, has clarified that all resident taxpayers whose total income is below the Section 87A threshold can claim the full tax rebate (up to Rs. 25,000), even on short-term capital gains from listed shares taxed at special rates under Section 111A. This applies to those filing under the new tax regime as well.
Key DetailsAssessment Year: 2024-25
Appellant: Priyamvada Singhal (represented by Sh. Mukesh Soni, Adv. & Sh. Vikas Gupta, Adv.)
Respondent: DCIT, Circle 7, Jaipur
Impugned Order: CIT(A) order dated 04.08.2025 u/s 250 of the Income Tax Act
Main Issue (from available public records)The appeal primarily concerns the denial of rebate under Section 87A (up to ₹25,000) against tax payable on short-term capital gains (STCG) taxable at special rates under Section 111A, even though the assessee had opted for the new tax regime under Section 115BAC and her total income was below the threshold for the rebate. The CPC (while processing the return u/s 143(1)(a)) and the CIT(A) had restricted the rebate to tax computed at normal slab rates only.
The assessee relied on consistent ITAT precedents (e.g., Jayshreeben Jayantibhai Palsana vs. ITO [2025] 177 taxmann.com 411 (Ahmedabad-Trib.)) holding that the rebate should be available on the entire tax liability (including on STCG u/s 111A) under the new regime when total income is within the limit.
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