DCIT -23(1), MUMBAI, MUMBAI vs. BUSINESS EXCELLANCE TRUST, IL AND FS TRUST COMPANY

ITA 2879/MUM/2023Status: DisposedITAT Mumbai26 July 2024AY 2018-19Bench: JUSTICE (RETD.) SHRI C.V. BHADANG (President), SHRI B.R. BASKARAN (Accountant Member)2 pages
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What did the Tribunal hold?

The Tribunal held that the assessee, being a legal entity and a 'person' under the Income Tax Act, is eligible to claim exemption under Section 10(38) for LTCG on unlisted shares acquired without STT, as it falls under the main provision of the relevant notification. The contention that it should be treated as a pass-through entity and exemption claimed only by investors was rejected as the Section 10(23FB) exemption was not granted.

What were the facts?

The assessee, a Venture Capital Fund (VCF), earned long-term capital gains (LTCG) from selling shares of an unlisted company. The assessee initially claimed exemption under Section 10(23FB) and later alternatively under Section 10(38). The Assessing Officer rejected both claims, and the CIT(A) allowed exemption under Section 10(38).

What were the issues?

Whether the VCF is eligible for exemption under Section 10(38) on LTCG from unlisted shares acquired without STT, and whether it can claim this exemption directly or only through investors.

Which sections of the Income-tax Act were involved?

Section 10(38),Section 10(23FB),Section 115U,Section 10(35)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “B”, MUMBAI

Before: JUSTICE (RETD.) SHRI C.V. BHADANG & SHRI B.R. BASKARAN

For Appellant: Shri Vijay Mehta
For Respondent: Shri S. Srinivasu, CIT-DR
Hearing: 24/07/2024Pronounced: 26/07/2024

Heard together (2 matters)

ITA NO. 2879/MUM/2023
CO NO. 15/MUM/2024

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

PER B.R. BASKARAN, ACCOUNTANT MEMBER :

The appeal of the Revenue and the cross objection filed by the assessee are directed against the order dated 20-06-2023 passed by Ld CIT(A), NFAC, Delhi and they relate to the assessment year 2018-19. 2. The Revenue has raised the following grounds of appeal:-

1.

Whether on the facts and circumstances of the case and in law, the Ld.CIT(A) is justified in deleting the addition made by the AO and allowing the exemption of Rs. 247,67,03,531/- u/s. 10(38) of the Act even if it is not claimed by the assessee in its original return of income?

2.

Whether on the facts and circumstances of the case and i

The order continues below.

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