In ITA No.223/Bang/2023- ITAT - ITAT (Bangalore) allows Foreign Tax Credit to assessee, holds filing of Form 67 is a procedural requirement
Members Laxmi Prasad Sahu (Accountant) & George George K (Judicial) [15-05-2023]

Read Order: Sri Sandeep Patwari v. The Deputy Commissioner of Income Tax

LE Correspondent

Bangalore, May 17, 2023: The Bangalore bench of the Income Tax Appellate Tribunal has held that the assessee was entitled to the benefit of Foreign Tax Credit (FTC), observing that filing of Form 67 was a procedural / directory requirement and not a mandatory requirement.

Factual background of the case was that the assessee, employed with Qualcomm India Private Limited, filed his return of income for the assessment year 2020-2021. The disclosed income included salary, house property, capital gains, interest, and dividends. The assessee declared salary earned abroad and paid taxes on it, claiming FTC under section 90/91 of the Income Tax Act. The assessee received intimation under section 143(1) of the Act, wherein the FTC of Rs.14,02,442 was not granted. The assessee filed a rectification under section 154 on 14.12.2021. The rectification order was passed not granting the claim of the assessee. The CIT(A) confirmed the order of rectification and held that the assessee had not filed Form No. 67 before the prescribed time limit. Therefore, it was concluded by the CIT(A) that Form No. 67 filed belatedly is nonest in law and the provisions of Rule 128 of the Income Tax Rules are mandatory in nature.

The bench of Laxmi Prasad Sahu (Accountant) & George George K (Judicial) placed reliance on Ms. Brinda Ramakrishna v. Income Tax Officer [LQ/ITAT/2021/2511], wherein it has been held that violation of the procedural norm does not extinguish the substantive right of claiming the credit of FTC.

In view of the aforesaid ruling, appeal of the assessee was allowed.