AQUARIUS TRANSNATIONAL,MUMBAI vs. ITO-12(1)(1), MUMBAI, AAYAKAR BHAWAN,MUMBAI

ITA 5553/MUM/2026Status: DisposedITAT Mumbai18 September 2026AY 2022-2311 pages
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What were the facts?

The assessee, a partnership firm, claimed set-off of brought-forward business losses and sought to tax capital gains arising from the transfer of a depreciable asset at a concessional rate. The Assessing Officer disallowed the business loss set-off and taxed the capital gain at the firm's slab rate.

What did the Tribunal hold?

The Tribunal held that the CIT(A)'s direction to verify the eligibility of brought-forward business losses from departmental records was appropriate. Regarding capital gains, the Tribunal ruled that if the asset qualifies as long-term, the gain, though computed under Section 50, should be taxed at the Section 112 rate.

What were the issues?

Whether brought-forward business losses can be verified from departmental records for set-off, and whether capital gains on depreciable assets held long-term are taxable at the Section 112 rate despite Section 50's deeming fiction.

Which sections of the Income-tax Act were involved?

Section 50,Section 112,Section 72,Section 139,Section 251

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI

Before: SHRI OM PRAKASH KANT & SHRI SIDDHARTHA NAUTIYAL

For Respondent: Shri Manoj Kumar (CIT-DR)

PER SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER:

This appeal is filed by the Assessee against the order of Ld. NFAC, Delhi vide DIN: ITBA/NFAC/S/250/2025-26/1086935473(1) dated 05-Jun-2026 for the Assessment Year 2022-23. The Assessee has raised the following grounds of appeal:

1.

That the Ld. CIT(A) has erred in law and on facts in directing the Ld. AO to verify the claim made by the Appellant of carry-forward and set-off of business losses of Rs 2,34,224/- pertaining to AY 2020-21 and AY 2021-22, f

The order continues below.

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