ITAT Deletes Rs 52.33 Lakh Addition as AO Cannot Deny Genuine Capital Loss Without Invoking Section 94(7) of Income Tax Act:

ITAT Deletes Rs 52.33 Lakh Addition as AO Cannot Deny Genuine Capital Loss Without Invoking Section 94(7) of Income Tax Act

The ITAT Mumbai has held that the AO cannot disregard a genuine short-term capital loss by treating dividend received from a mutual fund as return of capital without invoking any specific provision of the Income-tax Act.

Dividend Cannot Be Treated as Return of Capital Merely on Alleged Dividend Stripping

authorSaimadateJul 13, 2026
Last update on Jul 11, 2026
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ITAT Deletes Rs 52.33 Lakh Addition as AO Cannot Deny Genuine Capital Loss Without Invoking Section 94(7) of Income Tax Act

The ITAT Mumbai has held that the AO cannot disregard a genuine short-term capital loss by treating dividend received from a mutual fund as return of capital without invoking any specific provision of the Income-tax Act.

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Saima

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Saima is a Law graduate with a passion for research and content writing. She writes for Finance, Taxation and Legal Updates at Studycafe.in, simplifying complex legal decisions by the ITAT, High Court, AAR and GSTAT into uncomplicated and clear explanations.
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