RAOUL S. THACKERSEY,MUMBAI vs. ASST CIT 12(1), MUMBAI

ITA 3678/MUM/2015Status: DisposedITAT Mumbai15 April 2024AY 2010-11Bench: Justice (Rtd.) C.V. Bhadang (President), Shri B.R. Baskaran ( (Accountant Member)1 pages
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What did the Tribunal hold?

The Tribunal held that the surplus realized on redemption of NCDs is in the nature of interest income and not capital gains. Consequently, the assessee is not eligible for deductions under sections 54F and 54EC.

What were the facts?

The assessee declared long-term capital gains on the redemption of Non-Convertible Debentures (NCDs) and claimed deductions under sections 54F and 54EC. The Assessing Officer (AO) rejected the section 54F deduction due to non-compliance with conditions, while the CIT(A) held the surplus as interest income from other sources.

What were the issues?

Whether the surplus on redemption of NCDs is taxable as capital gains or interest income, and consequently, whether deductions under sections 54F and 54EC are allowable.

Which sections of the Income-tax Act were involved?

Section 54F,Section 54EC

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Income Tax Appellate Tribunal, Mumbai “D” Bench, Mumbai.

Before: Justice (Rtd.) C.V. Bhadang & Shri B.R. Baskaran (AM)

For Appellant: Shri K. Gopal & Ms
For Respondent: Smt. Mahita Nair
Hearing: 16.01.2024Pronounced: 15.04.2024

Per B.R.Baskaran (AM) :-

The assessee has filed this appeal challenging the order dated 24-03- 2015 passed by Ld CIT(A)-28, Mumbai and it relates to the assessment year 2010-11. The grounds of appeal urged by the assessee give rise to the following issues:-

(a) Whether the surplus realized by the assessee on surrender of Non Convertible Debenture (NCD) upon its redemption on maturity would give rise to Long term Capital gains or Income from other sources?

(b) If it is held as “income from other sources”, whether the surplus amount should be Rs.9.08 crores or Rs.12.59 crores?

(c) If it is held as “Long term Capital gains”, whether the assessee’s c

The order continues below.

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