VANGUARD EMERGING MARKETS STOCK INDEX FUND A SERIES OF VIEF,MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION)-4(3)(1), MUMBAI

ITA 1279/MUM/2025Status: DisposedITAT Mumbai23 May 2025AY 2022-23Bench: MS PADMAVATHY S (Accountant Member), SHRI RAHUL CHAUDHARY (Judicial Member)1 pages
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What did the Tribunal hold?

The Tribunal held that STCG on the sale of rights entitlement is exempt under Article 13(6) of the India-Ireland DTAA, as it is distinct from the sale of shares. The Tribunal also ruled that there is no prohibition against setting off STCG from non-STT paid shares against STCL from STT paid shares, allowing the assessee to choose the most beneficial set-off.

What were the facts?

The assessee, an Irish company registered as a Foreign Portfolio Investor in India, claimed exemption for short-term capital gains (STCG) on the sale of rights entitlement of shares under the India-Ireland DTAA. The Assessing Officer (AO) treated this gain as taxable under Article 13(5) of the DTAA, similar to the sale of shares.

What were the issues?

Whether STCG on the sale of rights entitlement is taxable in India under the India-Ireland DTAA, and whether STCG from non-STT paid shares can be set off against STCL from STT paid shares.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144C(13),Section 70,Section 71,Section 74

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Cases cited in this judgment(2)Show list

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Heard together (3 matters)

I.T.A. No. 1277/Mum/2025
I.T.A. No. 1278/Mum/2025
I.T.A. No. 1279/Mum/2025

Read from the judgment's own cause title. This page is filed under one of them.

IN THE INCOME TAX APPELLATE TRIBUNAL “I” BENCH, MUMBAI BEFORE MS PADMAVATHY S, AM & SHRI RAHUL CHAUDHARY, JM Vanguard Emerging Markets Stock ACIT (IT)-4(3)(1), Index Fund A Series of VISPLC, Kautilya Bhavan, G Block, C/o Ernst & Young LLP, 14th Floor, Maharashtra-400051. Dadar (West), Mumbai-400028. PAN: AACCV3136B Appellant) : Respondent) VFTC- Institutional Total ACIT (IT)-4(3)(1), International Stock Market Index Kautilya Bhavan, G Block, Trust II, Bandra Kurla Complex, C/o Ernst & Young LLP, 14th Floor, Vs.

Maharashtra-400051. The Ruby, 29, Senapati Bapat Marg, Dadar (West), Mumbai-400028. PAN: AADTV1640C Appellant) : Respondent)

Vanguard Emerging Markets Stock ACIT (IT)-4(3)(1), Index Fund A Series of VIEIF, Kautilya Bhavan, G Block, C/o Ernst & Young LLP, 14th Floor, Vs.

Bandra Kurla Complex, The Ruby, 29, Senapati Bapat Marg, Maharashtra-400051. Dadar (West), Mumbai-400028. 2 ITA 1277 to 1283/ Mum/2025 Vanguard Emerging Markets Stock Index Fund A Series of VISP

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