DHILLIP ANANDAM,CHENNAI vs. ITO, INTL TAXN WARD-1(1), CHENNAI

The assessee raised seven grounds of appeal, amongst which the only issue that emanates for consideration is as to whether the ld. CIT(A) is justified in confirming the denial of foreign tax credit (FTC) by the CPC, Bangalore, without condoning the delay of 1068 days in the facts and circumstances of the case.

Ld. AR Mr. Joseph Richard, Advocate, submit that the assessee filed an appeal before the the ld. CIT(A) against intimation dated 19.03.2021 passed by the CPC denying foreign tax credit for filing Form 67 belatedly, with a delay of 1068 days. Ld. AR referred to Form 35 and submit that the assessee explained the reasons for the said delay and the ld. CIT(A), without considering the same, dismissed the appeal of the assessee without condoning the delay. He placed on record the reasons explained by the assessee before the ld. CIT(A) vide notarized affidavit dated 05.06.2026. He argued that the assessee, in response to the intimation order dated 19.03.2021, filed a reply immediately on 22.03.2021 disagreeing with the demand raised by the respondent Revenue and requested to give effect to the FTC of ₹22,17,169. Again, the respondent Revenue raised a demand on 26.09.2023 rejecting his earlier reply; however, he filed another reply immediately on 04.10.2023 disputing the demand. As no positive action was taken with reference to the above-said two replies, the assessee approached a tax professional who, in turn, advised the assessee to consult a tax advocate. The assessee immediately filed an appeal before the ld. CIT(A), on taking advice from the tax advocate, with a delay of 1068 days. They argued that the assessee had a bona fide belief that the reply filed against the outstanding demand and the response filed disputing the demand notice would be sufficient compliance to nullify the demand, as Form 67 was filed before the end of the assessment year. He submits that the said delay is neither wilful nor wanton, but due to the circumstances and beyond the assessee’s control, and unless this Tribunal directs the ld. CIT(A) to condone the said delay and adjudicate the issue on merits, the assessee would be put to grave loss and hardship. He finally argued that no prejudice will be caused to the respondent Revenue in case the

Ld. DR Mr. Kumar Chandan, JCIT, relied upon the order of the ld. CIT(A).

Having heard both the sides, we note that the assessee filed the return of income on 15.07.2019, which is at pages 1 to 31 of the paper- book. On perusal of the same, we note that the assessee declared his status as a resident and gross salary from his employer in the USA vide Schedule S of the said return of income. Therefore, it is clear that the assessee disclosed salary earned outside India, which was subjected to tax in the said country. We find that the ld. CIT(A) denied the said FTC only on the ground of filing Form 67 belatedly. However, it was explained that the said Form 67 was filed before the end of the assessment year. Further, we note that the assessee took steps to file two replies against the intimation as well as the demand communication, which were not at all considered by the respondent Revenue. The only contention raised by the ld. ARs is that unless this Tribunal condones the delay, the assessee would be put to irreparable loss by suffering tax on the salary once again in India. We find force in the argument of the ld. AR that no prejudice will be caused to the Revenue in case we direct the ld. CIT(A) to condone the delay and adjudicate the issues on merits. Further, we find force in the argument of the ld. ARs that the a bona fide belief that the said two replies filed against the outstanding demand and the response filed disputing the demand notice would be sufficient compliance against the

In the result, the appeal of the assessee is allowed for statistical purposes.