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| The Tax Publishers2022 TaxPub(DT) 1316 (Bang-Trib) INCOME TAX ACT, 1961
Section 90 Rule 128
Filing of Form No. 67 is not mandatory but a directory requirement and therefore, even if Form No. 67 was filed belatedly the assessee was entitled to foreign tax credit.
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Double Taxation Relief - Foreign tax credit - Filing of Form No. 67 - Directory or mandatory
Assessee worked in a foreign company and claimed foreign tax credit ('FTC') for taxes paid in Australia. He claimed FTC under section 90 of the Act read with Article 24 of India Australia tax treaty ('DTAA') in a revised return of income. Assessee had not filed Form 67 before filing the return of income. On realising the same, assessee filed Form 67 in support of claim of foreign tax credit. Revised return of income was processed by CPC electronically and intimation under section 143(1) was passed disallowing the claim of FTC. Assessee filed a rectification application before AO and submitted that credit for FTC as claimed in the return should be given. In the rectification order, AO upheld the action on the ground that assessee had failed to furnish Form 67 on or before the due date of furnishing the return of income as prescribed under section 139(1) which was mandatory according to Rule 128(9) of the Rules. Held: Rule 128(9) of the Rules does not provide for disallowance of FTC in case of delay in filing Form No. 67. Filing of Form No. 67 is not mandatory but a directory requirement and DTAA overrides the provisions of the Act and the Rules cannot be contrary to the Act.
Cases cited by parties :Engineering Analysis Centre of Excellence (P) Ltd. v. CIT & Anr. (2021) 125 taxmann.com 42 (SC) : 2021 TaxPub(DT) 1208 (SC), GE India Technology Centre (P) Ltd. v. CIT & Anr. (2010) 193 Taxman 234 (SC) : 2010 TaxPub(DT) 2241 (SC), CIT v. Eli Lilly & Company (India) (P) Ltd. (2009) 178 Taxman 505 (SC) ; 2009 TaxPub(DT) 1585 (SC), Sambhaji v. Gangabai (2008) 17 SCC 117 : 2009 TaxPub(EX) 1999 (SC), UOI & Anr. v. Azadi Bachao Andolan & Anr. (2003) 263 ITR 706 (SC) : 2003 TaxPub(DT) 1429 (SC), Mangalore Chemicals & Fertilizers Ltd. v. Dy. Commr. 1992 Supp (1) Supreme Court Cases 21 : 1991 TaxPub(EX) 624 (SC), Pr. CIT v. M/s. Surya Merchants Ltd. (2016) 72 taxmann.com 16 (Allahabad) : 2018 TaxPub(DT) 5539 (All-HC)
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
IN THE ITAT, BANGALORE BENCH
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