Section 87A rebate applies to debt long-term capital gains, as the section 112A exclusion is limited to equity-linked gains.

Section 112A(6) bars rebate under section 87A only for tax on long-term capital gains covered by section 112A(1), namely gains from transfer of equity shares, equity-oriented funds or business trusts. Debt long-term capital gains fall under section 112 and are outside that exclusion. On that basis, the restriction of rebate was not justified for the debt capital gains component, and the tax was required to be recomputed to allow the full section 87A rebate.

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Issues: Whether the assessee was entitled to full rebate under section 87A of the Income-tax Act, 1961 where the returned income included both equity long-term capital gains and debt long-term capital gains.

Analysis: Section 112A(6) bars rebate under section 87A only on tax payable on capital gains covered by section 112A(1), namely long-term capital gains from transfer of equity shares, units of equity-oriented funds, or units of business trusts. Debt long-term capital gains are governed by section 112 and do not fall within that exclusion. The tax computation showed that the assessee's tax liability on eligible income exceeded the rebate threshold, and the restriction of rebate by CPC was not warranted in respect of the debt long-term capital gains component.

Conclusion: The assessee was entitled to the full rebate under section 87A, and the tax was required to be recomputed accordingly.

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