The present invention provides an improved process for the prepatipn_of Jstprotected ((3S54R)-4-(4-fluorophenyl)piperidin-3- yl)methanol (compound (A)) and further its transformation to Paroxetine and its pharmaceutically acceptable salts. The process comprises reaction of compound (II) with amido-malonate compound (C) in the presence of a chiral catalyst and optionally a dehydrating agent to obtain compound (B) followed by reduction of (B) in the presence of a reducing agent to provide compound (A).