New Delhi, Sept. 14 -- The Income Tax Appellate Tribunal (ITAT), Nagpur bench, has upheld a taxpayer's claim for a Rs.23,494 rebate under Section 87A on tax payable on short-term capital gains (STCG), dismissing an appeal filed by the Income Tax Department.

The case involved Sanjay Kumar Garg, who filed his income-tax return for assessment year 2025-26 under the new tax regime. He declared total income of about Rs.6.91 lakh from salary, capital gains and other sources and claimed a rebate of Rs.23,494 under Section 87A. The Centralised Processing Centre (CPC), however, denied the rebate while processing his return under Section 143(1), resulting in an additional tax demand of Rs.16,160.

Garg challenged the denial before the Commissioner...