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Facts
The assessee's claim for Foreign Tax Credit (FTC) of Rs. 1,06,217/- was denied by the Addl./JCIT(A) during processing of intimation under Section 143(1) of the Income Tax Act. The denial was based on the reason that Form 67, essential for claiming FTC, was filed belatedly and not along with the original return of income under Section 139(1).
Held
The Tribunal, relying on multiple coordinate bench decisions, held that the filing of Form 67 is a procedural/directory requirement, not a mandatory one that would lead to disallowance for delay. It directed the Assessing Officer to accept the belatedly filed Form 67 and allow the Foreign Tax Credit after due verification.
Key Issues
Whether Foreign Tax Credit (FTC) can be denied solely on the ground of belated filing of Form 67, or if the requirement to file Form 67 is procedural and not mandatory.
Sections Cited
250, 143(1), 143(2), 139(1), 154, Rule 128
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Income Tax Appellate Tribunal, DELHI BENCH “G” NEW DELHI
Before: SHRI CHALLA NAGENDRA PRASAD & SHRI BRAJESH KUMAR SINGH
सुनवाईक�तारीख/ Date of hearing: 24.07.2025 30.07.2025 उ�ोषणाक�तारीख/Pronouncement on आदेश /O R D E R PER C.N. PRASAD, J.M.
This appeal is filed by the Assessee against the order of the Ld. Addl./JCIT(Appeals)-5, Kolkata dated 20.02.2025 for the AY 2020-21. Assessee raised the following grounds: -
A. “That Ld. Addl./JCIT-A vide impugned order passed u/s 250 dated 20.02.2025 erred in not quashing the impugned INTIMATION passed/processed u/s 143(1) of 1961 Act dated 15.12.2021, on jurisdictional ground of a) Being contrary to mandate of 1961 Act and; b) Being totally in violation of principle of natural justice (illustratively it is passed without issue of any valid/requisite prior show cause notice/SCN) and c) Subject matter is not falling in statutory purview of section 143(1) and in worst case only available option was to issue notice u/s 143(2) of 1961 Act;
B. That Ld. Addl./JCIT-A vide impugned order passed u/s 250 dated 20.02.2025 erred in not deleting the sole impugned adjustment made in the impugned INTIMATION passed/processed u/s 143(1) of 1961 Act dated 15.12.2021 amounting to Rs.106,217, where assessee has admittedly made “substantial” compliance in filing of FORM 67 so as to claim subject “FTC” (foreign tax credit).
C. That the appellant craves leave to add/alter any/all grounds of appeal before or at the time of hearing of the appeal.”
Ld. Counsel for the assessee, at the outset, referring to ground no. B of grounds of appeal submits that while processing the intimation u/s 143(1) Foreign Tax Credit of Rs.1,06,217/- was denied to the assessee for the reason that Form 67 claiming Foreign Tax Credit (FTC) was not furnished along with the return filed u/s 139(1) of the Act but was filed belatedly. Ld. Counsel for the assessee placing reliance on the decision of the Kolkata Bench in the case of BGA Electronic and Service Pvt. Ltd. vs. DCIT in dated 18.11.2024 submitted that on identical facts the Tribunal allowed the FTC even though Form 67 was filed 2 belatedly. Reliance was also placed on the decision of the Kolkata Bench in the case of Surinder Kumar Goenka vs. ADIT (CPC) Bangaluru dated 05.12.2024.
3. On the other hand, the Ld. DR strongly supported the orders of the Ld. CIT(Appeals).
Heard rival submissions. On reading of the orders of the authorities below, we observe that the claim for Foreign Tax Credit was denied to the assessee for the reason that the assessee has filed Form 67 after filing return of income u/s 139(1) of the Act. Since the assessee filed Form 67 belatedly and not along with the return as specified u/s 139(1) of the Act the claim for FTC was denied.
5. We observe that identical issue came up before the coordinate bench of the Delhi Tribunal in the case of Neha Kapoor vs. ITO in ITA 135/Del/2023 dated 29.08.2023, wherein the Tribunal directed the Assessing Officer to allow credit for Foreign Tax Credit to the assessee observing as under:
“8. We have considered the submissions of the parties and perused the records. It is evident that the solitary ground of denial of the claim of the assessee for FTC is delay in filing Form 67. It is an admitted position that the assessee filed Form 67 on 26.03.2021 along with the revised return before the end of the relevant AY 2020-21 which is in conformity with the CBDT notification No. 100/2022 amending Sub Rule 9 of Rule 128 of the Rules.
Various coordinate benches of the Tribunal have held that filing Form 67 is a procedural/directory requirement and is not a mandatory requirement. We, therefore, disagree with the view of the Ld. CIT(A) on the point and reproduce below the decision in the case of Miss Brinda Rama Krishna (supra) in which facts are identical: "16. I have given a careful consideration to the rival submissions. I agree with the contentions put forth by the learned counsel for the Assessee and hold that (i) Rule 128(9) of the Rules does not provide for disallowance of FTC in case of delay in filing Form No.67; (ii) filing of Form No.67 is not mandatory but a directory requirement and (iii) DTAA overrides the provisions of the Act and the Rules cannot be contrary to the Act. I am of the view that the issue was not debatable and there was only one view possible on the issue which is the view set out above. I am also of the view that the issue in the proceedings u/s.154 of the Act, even if it involves long drawn process of reasoning, the answer to the question can be only one and in such circumstances, proceedings u/s.154 of the Act, can be resorted to. Even otherwise the ground on which the revenue authorities rejected the Assessee's application u/s.154 of the Act was not on the ground that the issue was debatable but on merits. I therefore do not agree with the submission of the learned DR in this regard."
Respectfully we follow the decision (supra).
Accordingly, we hereby direct the Ld. AO to allow the impugned credit of FTC to the assessee in the light of the decision in the case of Ms. Brinda Rama Krishna (supra).”
6. Similar view has been taken by the coordinate benches in the following cases: dated 17.04.2023;
2. Suchi Agarwal vs. ITO in dated 24.1.2024;
Dharmendra Kumar Singh vs. ITO in dated 24.01.2025;
4. Vinod Kumar Laxmi Pati vs. CIT, NFAC 145 taxmann.com 235 (Bang.);
Ritesh Kumar Garg vs. ITO in dated 15.09.2022 (Jaipur);
Sanjeev Agarwal vs. DIT in dated 10.05.2023
7. Surender Kumar Goenka vs. ADIT in dated 20.11.2024.
Following the above orders, we direct the Assessing Officer to accept Form 67 filed by the assessee and allow Foreign Tax Credit after due verification and in accordance with law.
In the result, assessee’s appeal is allowed.
Order pronounced in the open court on 30.07.2025