TaxTMI 
TaxTMI 
2026 (6) TMI 129
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....ashed. 2. Ld. CIT(A) has failed to appreciate that the adjustment/disallowance made by CPC under section 143(1) travels beyond the scope of prima facie adjustments permissible under section 143(1)(a), and hence the intimation Itself is invalid in law. 3. Ld. CIT(A) erred in mechanically confirming the adjustment made by CPC, without Independent application of mind and without appreciating the detailed submissions, explanations, and documentary evidences filed by the appellant. 4. Ld. CIT(A) erred in law and on facts in confirming the disallowance/denial of claim made by CPC, despite the claim being legally admissible, supported by return particulars, and not falling within the mischief of section 143(1)(a), 5. Ld. CIT(A) erred in law as well as on facts in not allowing rebate u/s. 87A of Rs. 22,548/-. 6. Ld. CIT(A) erred in law as well as on facts in not allowing set off of the income from capital gain against the basic exemption slab. 7. The Hon'ble CIT(A) failed to consider and apply binding judicial precedents which clearly hold that debatable issues and claims requiring verification cannot be adjusted under section 143(1....
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.... of rebate under section 87A by the CPC, Bengaluru, appears to be based solely ITA No.1014/Ahd/2025 11 on system-driven logic and not on any statutory mandate.", and the said issue has been adjudicated in favour of the assessee. Ld. Counsel for the assessee submitted that the present appeal is squarely covered by the above said order of the Tribunal, a copy of which was also placed before the Bench. 4. On the other hand, Ld. DR relied on the order of the authorities below. 5. I see no reason to take any other view of the matter then the view so taken by the Division Bench of this Tribunal in the case of Jayshreeben Jayantibhai Palsana(supra), vide order dated 12.08.2025. In this order, the Tribunal has inter alia observed as follows: "5. We have carefully considered the rival submissions, the impugned order of the CIT(A), the material placed on record, and the applicable statutory provisions. Thus, the core issue for adjudication before us is - "Whether a resident individual who has exercised the option under section 115BAC(1A) and whose total income is below Rs. 7,00,000/-, is eligible to claim rebate under section 87A against tax payable on STC....
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....n 111A or in section 87A must be construed in favour of the 5.12 At this point we discuss the interplay of Section 115BAC(IA) with Chapter XII where the scope is Confined to Computation of Tax Rates. Section 115BAC(1A) opens with the phrase: "Notwithstanding anything contained in this Act but subject to the provisions of this Chapter..." 5.13 The purpose of this clause is to enable the computation of income tax under the concessional rate regime, subject to existing special rate provisions under Chapter XII. such as sections 111A, 112, 1124, etc. This clause governs the computation of tax and does not ipso facto affect eligibility to rebates or deductions unless specifically restricted. Section 87A is not part of Chapter XII; it is an independent rebate provision under Chapter VIII of the Act. Therefore, the overriding clause in section 115BAC(1A) does not derogate or modify section 87A, unless section 87A itself provides for exclusion, which, in the present case, it does not. Thus, section 874 operates on the total tax computed, whether it includes tax at slab rates or special rates, and applies so long as the total income threshold is met. 5.14....
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....iews exist and such benefit has been allowed in similar factual circumstances. 5.17 In view of the above discussion, we find that the assessee is a resident individual and the total income declared for the assessment year 2024-25 does not exceed Rs 7,00,000. It is also an admitted position that the assessee has exercised the option to be assessed under the new tax regime in accordance with the provisions of section 115BAC(1A) of the Act. On a plain reading of the statutory provisions, there exists no express bar either in section 87A or section 111A for denial of rebate in respect of tax payable on short-term capital gains arising from transfer of listed equity shares taxable at special rates under section 111A. The legislative intent is further clarified by the subsequent amendment proposed in the Finance Bill, 2025, which is prospective in nature and thereby reinforces that no such restriction was in force during the relevant assessment year. The denial of rebate under section 874 by the CPC, Bengaluru, appears to be based solely on system-driven logic and not on any statutory mandate. Moreover, the interpretation adopted by the CIT(A) in upholding such denial is, in our....