BHASKAR CADUVETI RAO ,MUMBAI vs. DCIT, 42(2), MUMBAI

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ITA 9435/MUM/2025Status: DisposedITAT Mumbai18 June 2026AY 2020-214 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal noted that the assessee filed a rectification application with the CPC, clarifying the FTC amount. The CPC subsequently allowed the claim, rendering the assessee's grievance resolved.

What were the facts?

The assessee claimed foreign tax credit (FTC) for income earned in the US. Initially, the FTC was allowed by the CPC, but later denied through a rectification order under Section 154. The CIT(A) upheld this denial.

What were the issues?

The primary issue was the denial of foreign tax credit by the CPC and CIT(A). The appeal became infructuous as the CPC ultimately allowed the FTC claim.

Which sections of the Income-tax Act were involved?

Section 154,Section 143(1),Section 90,Section 251(2)

AI-generated summary — verify with the full judgment below

Before: HON’BLE JUSTICE (RETD.) C V BHADANG & SHRI PRABHASH SHANKAR

For Appellant: Shri Nitesh Joshi,AR
For Respondent: Shri SwapnilChoudhari, (Sr. AR.)
Hearing: 04.05.2026Pronounced: 18.06.2026

आदेश / O R D E R PER PRABHASH SHANKAR [A.M.] :- The present appeal emanating from the appellate order dated 16.10.2025 is preferred by the assessee against the order passed by the Learned Commissioner of Income-tax (Appeals), ADDL/JCIT (A) Mysore [hereinafter referred to as “CIT(A)”] pertaining to the assessment order passed u/s. 154 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] dated 22.08.2022 for the Assessment Year [A.Y.] 2020-21.

ITA No. 9435/Mum/2025; BhaskarCaduveti Rao. 2. The grounds of appeal are as under: “1. The order passed by the Addl./JCIT (A)-Kochi, ['the CIT(A)'] dismissing the appeal of the Appellant is bad in law for the following reasons: a. The CIT(A) erred in enhancing the liability to pay tax without giving prior show cause notice, violating the mandatory provision of section 251(2) of the Income-tax Act, 1961 ('the Act'). b. The CIT(A) erred in confirming the rectification order passed by the Central Processing Centre (CPC) under section 154 of the Act which order was passed in violation of the mandatory provision of section 154(3) of the Act. e. The CIT(A) erred in upholding the action of CPC denying foreign tax credit by an order under section 154 of the Act rectifying intimation under section 143(1) of the Act. d. The CIT(A) erred in dismissing the appeal of the Appellant in violation of the principles of natural justice. Without prejudice to Ground No. 1: 2. The CIT(A) erred in not allowing the Appellant's claim of foreign tax credit (in respect of income chargeable to tax under the head Capital Gains) as per the provisions of section 90 of the Act read with the provisions of the India-USA Double Taxation Avoidance Agreement. Without prejudice to Ground Nos. 1 and 2: 3. The CIT(A) erred in confirming the order of rectification passed by the CPC under section 154 of the Act whereunder the foreign tax credit (in respect of income chargeable to tax under the head Capital Gains) has been denied to the Appellant on account of a mere arithmetical error. 3. In this case, the only substantive issue for adjudication is relating to the claim of the assessee for Foreign Tax Credit as per the provisions of section 90 of the Act r.w. the provisions of the India-USA Double Taxation Avoidance Agreement(DTAA).It is submitted that the assessee was not allowed full credit in the orders passed by the AO u/s 154 of the Act.

4.

In this case, the assessee is a resident but derived income from US where he was staying earlier and the taxes paid there were claimed for credit against the tax liability in terms of section 90 of the Act and for which the

ITA No. 9435/Mum/2025; BhaskarCaduveti Rao. assessee had filed Form no.67 before the due date of return.The return of income was processed u/s 143(1) of the Act by the Centralised Processing Center(CPC),Bengaluru in which the desired credit was allowed.

4.1 The assessee also filed a revised Form no.67 later but within the due date. The CPC did not allow the credit. Against such denial, the assessee filed further appeal before the ld.CIT(A) who rejected the application by observing there were too many inconsistencies if the FTS claim by the assessee as the claimed amount was stated differently at several points by the AO. Moreover, considering the claim u/s 54F of the Act which was also not explained, he rejected the appeal field by the assessee.

5.

Before us, the ld.AR has filed Paper Book containing various documents relating to the issue. However, it was submitted that the assessee again filed rectification application u/s 154 of the Act dated 12.02.2026 before CPC clarifying the actual amount of FTS with a request to allow the same. The CPC vide its order dated 25.02.2026 on pages-152 to 158 of the Paper Book, ultimately allowed the claim of the assessee. As such, there is no demand existing against the assessee and his grievance was adequately taken care of. The ld.AR was fair enough to admit that the credit was ultimately granted by the AO.

6.

Considering the above submission and the admission of the ld.AR, the assessee is no longer aggrieved. Therefore, the appeal has become infructous.

ITA No. 9435/Mum/2025; BhaskarCaduveti Rao. 7. In the result, the appeal filed by the assessee being infructous, is dismissed.

Order pronounced in the open court on 18/06/2026.

Sd/- Sd/- [Justice (Retd. ) C. V. BHADANG] [PRABHASH SHANKAR] ACCOUNTANT MEMBER PRESIDENT

Place: म ुंबई/Mumbai ददनाुंक /Date 18.06.2026 Soumili Das / PS

आदेश की प्रतितलति अग्रेतिि/Copy of the Order forwarded to : 1. अपीलार्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यावपि प्रवि //True Copy// आदेशानुसार/ BY ORDER,

उि/सहायक िंजीकार (Dy./Asstt. Registrar) आयकर अिीली अतधकरण

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