Whether inclusion of LTCG taxed at 12.5% in adjusted total income under Section 115JC (AMT) nullifies the benefit of concessional capital gains rate

[Fahiyaz Ahmmed]

Under the amended LTCG regime (Finance Act, 2024), an assessee may opt to pay 12.5% LTCG without indexation (or 20% with indexation for pre-23/07/2024 properties). However, the LTCG amount is still included in total income / adjusted total income for Section 115JC (AMT) purposes. Due to this inclusion, AMT at 18.5% may become payable, effectively nullifying the benefit of the 12.5% option. This results in an indirect higher tax burden on LTCG despite a special concessional rate being provided by law. Is there any Supreme Court or High Court ruling addressing this interaction between LTCG at special rates and AMT under Section 115JC? Have courts provided any remedy or exclusion to preserve the benefit of the concessional LTCG rate? If not, are there analogous MAT/AMT judgments on capital gains that can be relied upon?

AI Summary

Alternative Minimum Tax on concessional long-term capital gains may still apply despite the special capital gains rate.
Concessional long-term capital gains taxation under the amended capital gains regime may still be included in adjusted total income for Alternative Minimum Tax under Section 115JC, so the special rate does not by itself prevent AMT from applying. No direct Supreme Court or High Court ruling is identified on this specific interaction. Analogous MAT and AMT jurisprudence is said to treat such provisions as self-contained and overriding, with exclusions recognized only where expressly provided by statute.