ASSISTANT COMMISSIONER OF INCOME TAX, DELHI vs. VIREET INVESTMENTS PRIVATE LIMITED, DELHI

ITA 3010/DEL/2024Status: DisposedITAT Delhi14 November 2025AY 2007-08Bench: SHRI YOGESH KUMAR U.S. (Judicial Member), SHRI AVDHESH KUMAR MISHRA (Accountant Member)16 pages
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What did the Tribunal hold?

The Tribunal remitted the issue of LTCG exemption under Section 10(38) back to the AO for fresh adjudication, stating that the nature of all transferred assets needs to be examined. However, the Tribunal upheld the deletion of the notional interest addition, relying on previous decisions in the assessee's own case by the High Court and ITAT Special Bench.

What were the facts?

The Revenue appealed the deletion of additions made by the Assessing Officer regarding LTCG exemption under Section 10(38) and notional interest income. The assessee claimed exemption for LTCG on shares and equity-oriented mutual funds, and the AO disallowed it, alleging the funds were not equity-oriented. The AO also added notional interest on interest-free advances made by the assessee.

What were the issues?

Whether the LTCG claimed as exempt under Section 10(38) arose from the transfer of equity shares or units of equity-oriented funds. Whether notional interest should be charged on interest-free advances made by the assessee, an investment company.

Which sections of the Income-tax Act were involved?

Section 10(38),Section 115JB

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Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, DELHI BENCH ‘E’: NEW DELHI

Before: SHRI YOGESH KUMAR U.S. & SHRI AVDHESH KUMAR MISHRA

For Appellant: Ms. Amisha S. Gupt, CIT(DR)
Hearing: 18/08/2025Pronounced: 14/11/2025

PER AVDHESH KUMAR MISHRA, AM This appeal for Assessment Year (‘AY’) 2007-08 filed by the Revenue is directed against the order dated 30.03.2024 of the Commissioner of Income Tax (Appeals), NFAC, New Delhi [‘CIT(A)’].

2.

Following effective grounds have been raised by the Revenue: -

“1. Whether, on the facts and circumstances of the case and in law the Ld. CIT(A) has erred in deleting the addition of Rs.8,90,66,252/- on account of disallowance u/s 10(38) of the IT Act.

2.

Whether, on the facts and circumstances of the case and in law the Ld. CIT(A) has erred in deleting the addition of Rs.10,49,768/- on account of interest income.” Vi

The order continues below.

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