NEETA MAKKAR,KOLKATA vs. D.C.I.T., CIRCLE - 61,, KOLKATA

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA‘C’ BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, ACCOUNTANT MEMBER AND SHRI PRADIP KUMAR CHOUBEY, JUDICIAL MEMBER I.T.A. No.94/KOL/2026 (Assessment Year:2017-18) Neeta Makkar, DCIT, C/o B Kumar & Co., Vs. Circle – 61, Chartered Accountants, Kolkata 20, Indrani Park, Ground Floor, Kolkata – 700033, West Bengal [PAN:AEJPM0954L] (Appellant) .. (Respondent) Appellant by : Shri AkkalDudhewala, CA Respondent by: Shri Soumitra Ghosh, Sr. DR Date of Hearing 02.04.2026 Date of Pronouncement 25.06.2026

O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: This is an appeal preferred by the assessee against the order of the Commissioner of Income-tax (Appeals), Addl/JCIT (A), Kochi (hereinafter referred to as the “Ld. CIT(A)”] dated 04.11.2025 for the AY 2017-18.

ITA No.94/Kol/2026/AY 2017-18 Neeta Makkar ₹83,88,210/-. The case of the assessee was selected for regular scrutiny by issue of notice u/s 143(2) of the Income-tax Act, 1961 (the Act). The assessment was completed u/s 143(3) of the Act at total income of ₹83,88,210/- as declared by the assessee in her return of income. However, in the ITNS Computation Sheet annexed to the assessment order, the ld. AO had denied foreign tax credit of ₹8,81,398/- claimed by the assessee u/s 90 of the Act.

“8. We find that the assessee has filed its original income tax return on 31.07.2017 u/s 139(1) of the act and Form no. 67 has been filed on 12.07.2018. The Ld. CIT(A) has dismissed the case of the assessee only on this ground that there was a delay in filing of form no. 67. We have perused the decision of Co-ordinate bench of Kolkata in the case of Anindya Sarka vs. ACIT, CPC in ITA No. 1345/Kol/2024 for AY 2020-21 dated 26.07.2024. The operative part is reproduced as under: "7. The Ld. DR supported the order of the Ld. CIT(A). We have gone through the rival contention and also examined the facts. It was submitted before the Ld. CIT(A) by the assessee that the rerun of income was filed on 25.12.2020 and on 26.12.2020 he had submitted the Form No. 67 after receiving the communication 2

ITA No.94/Kol/2026/AY 2017-18 Neeta Makkar from the e-filing team, Income Tax Department on 25.12.2020 that the return of income was not accompanied by Form No. 67 as mandated by I.T.A. No. 1831/Kol/2024 Assessment Year: 2020-21 Surendra Kumar Goenka law. Subsequently, since the credit was not allowed, he filed rectification application and Form No. 67 on 03.07.2022 and prior to that rectification requests on 21.05.2022 and on 07.06.2022 were also filed. The credit was not allowed since From No. 67 was filed beyond the date for filing the return of income under Section 139(1) of the Act. In the case of Mahua Bagchi Vs. ACIT (supra) relied upon by the assessee, it is held as under: ……. 8. Further, in the case of Deepak ShimogaPadmaraju Vs. Assistant Director of Income Tax (supra), relying upon the case of Brinda Rama Krishna in ITA No. 454/Bang/2021 for AY 2018- 19, order dated 17.11.2021 it has been held that Rule 128(9) of the Rules does not provide for disallowance of FTC in case of delay in filing Form No. 67. The relevant extract of the aforesaid order read as under: "(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. Therefore, non-furnishing of Form No.67 before the due date u/s 139(1) of the Act is not fatal to the claim for FTC. The findings of this Tribunal are reproduced below: …. 16. We have also gone through the decision of the Hon'ble Madras High Court in the case of Duraiswamy Kumaraswamy us. PCIT (supra) and found that the facts are identical to the facts of the case of the assessee and the decision is squarely applicable to the facts of the case of the assessee. In that case, the petitioner was resident of India and had filed Indian ITR and claimed benefit of FTC u/s 90/91 of the Act row. Article 24 of the India-Kenya DTAA. During the year, he had income of both Kenya and India but while filing the Indian ITR for the impugned assessment year 2019-20, the Form No. 67 prescribed in rule 128 of the rules for claiming FTC was inadvertently not uploaded along with the ITK which was uploaded on 02.02.2021 The return was processed on 26.03.2021, however, the credit of FTC was not given effect to and the request made to the CPC to give effect to the FTC was not accepted and intimation along with notices of demand was received. The assessee also could not succeed with the rectification application filed and approached the CIT u/s 264 of the Act and at the same time filed a writ petition before the Hon'ble Madras High Court. It was stated by the respondent- department that rule 128 is mandatory and cannot be considered as directory in nature. The petitioner referred to the judgment of the Hon'ble Supreme Court in the case of CIT vs. G.M. Knitting Industries (P) Ltd. Civil Appeal Nos. 10782 of 2013 and 4048 of 2014 dated 24.06.2015 The Hon'ble High Court allowed the Writ Petition in favour of the assessee by holding as under. "11. The law laid down by the Hon'ble Apex Court in Commissioner of Income Tax, Maharashtra v. G.M.Knitting Industries (P) Limited in Civil Appeal Nos.

ITA No.94/Kol/2026/AY 2017-18 Neeta Makkar 10782 of 2013 and 4048 of 2014 dated 24.06.2015, which was referred above, would be squarely applicable to the present case. In the present case, the returns were filed without FTC, however the same was filed before passing of the final assessment order. The filing of FTC in terms of the Rule 128 is only directory in nature. The rule is only for the implementation of the provisions of the Act and it will always be directory in nature This is what the Hon'ble Supreme Court had held in the above cases when the returns were filed without furnishing Form 3AA and the same can be filed the subsequent to the passing of assessment order. W P. No 5834 of 2022. 12 Further, in the present case, the intimation under Section 143(1) was issued on 26.03.2021, but the FTC was filed on 02.02.2021. Thus, the respondent is supposed to have provided the due credit to the FTC of the petitioner. However, the PTC was rejected by the respondent, which is not proper and the same is not in accordance with law. Therefore, the impugned order is liable to be set aside. 13. Accordingly, the impugned order dated 25.01.2022 is set aside. While setting aside the impugned order, this Court remits the matter back to the respondent to make reassessment by taking into consideration of the FTC filed by the petitioner on 02.02.2021. The respondent is directed to give due credit to the Kenya income of the petitioner and pass the final assessment order. Further, it is made clear that the impugned order is set wade only to the extent of disallowing of FTC clam made by the petitioner und hence, the first respondent is directed to consider only on the aspect of rejection of FTC clam within a period of 8 weeks from the date of receipt of copy of this order" 17. Respectfully following the order of the Hon'ble Madras High Court in the case of Duraiswamy Kumaraswamy vs. PCIT (supra) and concurring with the views held by the coordinate Benches of the Tribunal (supra), we hold that merely because the assessee could not file Form No. 67 within the prescribed time limit as per the provisions of rule 128(9) of the Income-tax rules, 1962, as it stood during the year under consideration, will not preclude the assessee from claiming the benefit of the foreign tax credit in respect of taxes paid outside India. Therefore, the claim of the assessee is allowed and the Assessing Officer is directed to give benefit of foreign tax credit in respect of tax paid outside India by the assessee in accordance with law and the DTAA between India and the USA. Accordingly, grounds no. 2,3,4 of the appeal are allowed. 10. Keeping in view, the provision of DTAA as well as the judicial precedent in this regard, we find no justification for not allowing the credit for FTC. The order of the Ld. CIT(A) as well as the AO for disallowing the foreign tax credit claimed in revised Indian tax return amounting to Rs. 20,64,365/- is hereby set aside. The assessee is entitled for advance of FTC of Rs. 20,64,365/-. So far the other submission of the record for levying interest is concerned in view of the decision as stated above, the levying additional interest is also hereby set aside.”

ITA No.94/Kol/2026/AY 2017-18 Neeta Makkar

the order is pronounced in the open Court on 25/06/2026.

Sd/- Sd/- (Pradip Kumar Choubey) (Rajesh Kumar) JUDICIAL MEMBER ACCOUNTANT MEMBER Kolkata, Dated: 25.06.2026 SAMANTA ] �ȯ��ȧĤǓ�ͧ �ͪ �\ Ē ȯͪ��/Copy of the Order forwarded to : 1. \ �Ȣ�ȡ�ȸ/ The Appellant 2. Ĥ×��ȸ/ The Respondent. 3. Ȳ�Ȳͬ��] ���] �ǕÈ�/ Concerned CIT 4. ] ���] �ǕÈ�(अपील) /The CIT(A)- 5. ��ȡ�Ȣ�ĤǓ�Ǔ�ͬ �, ] ���\ �Ȣ�ȣ�\ͬ ����,/ DR, ITAT, Kolkata 6. �ȡ�[�ȡ_�/Guard file. BY ORDER, // TRUE COPY // Asstt. Registrar, ITAT, Kolkata