Bifalgorithm post

Did you know even short-term capital gains from the sale of shares and mutual funds can also get a rebate under Section 87(a). This story is of Ms. Jayshree Bain who fought with the income tax department all the way to the I-DAT. Her total income was under 7 lakh rupees and including short-term capital gain. Therefore, she filed her income tax return while claiming the 87(a) rebate. The 87(a) section says that if you have your total income under 7 lakh rupees, then you get a rebate of 25,000 rupees. Now when she filed her income tax return, she got an income tax notice refusing the same. Therefore she filed and lost at CIT. She further appealed to the ITAT and won. The ITAT ruled in her favor saying that there is no restriction on including short-term capital gain while calculating the total income as per section 87A. Now based on this judgment, it seems like everybody who falls in this criteria can claim the rebate, but here is a problem. The income tax utility on the website still does not consider short term capital gain while calculating the rebate under section 87A. Therefore, you have two options. First is, you either wait for the income tax department to make changes to the utility. The second option is that you enter the rebate amount manually by calculating it yourself. So, since there are not many days left for the IDR due date which is on 15th of September, I suggest that you file your IDR as early as possible so that you also get your refunds early as well. My name is CS. with Mehta and you can follow me for more finance and tax updates.

Did you know even short-term capital gains from the sale of shares and mutual funds can also get a rebate under Section 87(a). This story is of Ms. Jayshree Ba…