Grandfathered Capital Gains Exemption Upheld: No Adjustment of Losses Against Tax-Exempt Long-Term Transactions Under India-Mauritius DTAA

ITAT adjudicated a dispute regarding capital gains taxation, specifically addressing the set-off of non-grandfathered short-term and long-term capital losses against grandfathered long-term capital gains under the India-Mauritius Double Taxation Avoidance Agreement. The tribunal ruled that long-term capital gains from grandfathered transactions under Article 13(4) cannot be adjusted against the assessee's capital losses. The Appellate Tribunal directed the Assessing Officer to grant full exemption for the grandfathered long-term capital gains and permit carry-forward of capital losses to subsequent years in accordance with statutory provisions, ultimately allowing the assessee's appeal. .....

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