ADITYA KAPOOR,HARAYANA vs. INCOME TAX OFFICER, WARD-5(3)(2), BENGALURU

ITA 2925/BANG/2025Status: DisposedITAT Bangalore22 September 2026AY 2019-208 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal decided to condone the delay of 36 days in filing the appeal, finding that the explanation provided by the assessee, supported by an affidavit, was reasonable and that the delay was neither deliberate nor intentional. The Tribunal relied on the principles laid down by the Hon'ble Supreme Court in Collector, Land Acquisition v. Mst. Katiji & Others, emphasizing substantial justice over technical considerations. Regarding the foreign tax credit, the Tribunal held that the assessee was entitled to the FTC of Rs. 3,17,536/-. It noted that Form No. 67 was initially filed on 31.08.2019 with a procedural defect (incorrect Article number of the DTAA), which was subsequently corrected. The Tribunal found that filing Form No. 67 is a procedural requirement for verification and that a minor defect or delay in filing does not deny the substantive right to FTC. The Tribunal followed the decisions of its coordinate benches in Deepak Shimoga Padmaraju and Vinodkumar Lakshmipathi, holding that Rule 128(9) of the Income-tax Rules, 1962, does not provide for disallowance of FTC merely on account of delay in filing Form No. 67, and that such delay is not fatal. The Tribunal set aside the order of the CIT(A) and directed the Assessing Officer to allow the FTC, subject to verification of tax paid in Germany and the quantum allowable as per Section 90, Article 23 of the India-Germany DTAA, and Rule 128.

What were the facts?

The assessee, Aditya Kapoor, filed an appeal before the Income Tax Appellate Tribunal (ITAT), Bangalore Bench, against the order of the Commissioner of Income Tax (Appeals) dated 27.08.2025. The appeal pertains to Assessment Year 2019-20. The assessee had claimed foreign tax credit (FTC) of Rs. 3,17,536/- under Section 90 of the Income Tax Act, 1961, for taxes paid in Germany on income from the sale of Stock Option Plans (SOPs). The Central Processing Centre (CPC) denied this credit during processing under Section 143(1), citing issues with Form 67. The assessee's initial appeal to the CIT(A) was dismissed, leading to the present appeal before the ITAT. The appeal was filed with a delay of 36 days, which the assessee sought to condone.

What were the issues?

1. Whether the delay of 36 days in filing the appeal before the Tribunal is liable to be condoned? (Question of procedure) 2. Whether the assessee is entitled to claim foreign tax credit of Rs. 3,17,536/- under Section 90 of the Income Tax Act, 1961, read with Article 23 of the India-Germany Double Taxation Avoidance Agreement (DTAA), despite alleged non-compliance with the prescribed time limit for filing Form No. 67? (Question of mixed law and fact) Assessee's Contentions: - The delay in filing the appeal was due to incorrect advice from the previous tax consultant and the subsequent search for a new consultant. The delay was neither deliberate nor intentional, and the assessee relied on the principles laid down in Collector, Land Acquisition v. Mst. Katiji & Others (1987) 167 ITR 471 (SC) for condonation. - Form No. 67 was initially filed on 31.08.2019, within the prescribed time, but with an incorrect Article number of the DTAA. A revised Form 67 was filed on 27.01.2023. - The denial of FTC was unjustified as the income was taxed in Germany and tax was paid. The filing of Form 67 is a procedural requirement, and a minor defect or delay should not deny the substantive right to FTC. - Relied on the decisions in Deepak Shimoga Padmaraju v. ADIT/ITO [2024] 162 taxmann.com 96 (Bangalore - Trib.) and Vinodkumar Lakshmipathi v. CIT(A), NFAC, Delhi [2022] 145 taxmann.com 235 (Bangalore - Trib.), which held that delay in filing Form 67 is not fatal to the claim of FTC. Revenue's Contentions: - The revenue vehemently opposed the condonation of delay, arguing that the assessee had not shown sufficient cause for filing the appeal beyond the prescribed time.

Which sections of the Income-tax Act were involved?

Section 90,Section 143(1),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCHES, BANGALORE

Before: SHRI WASEEM AHMED & SHRI SANDEEP SINGH KARHAIL

For Respondent: Shri. Balusamy. H, JCIT

PER SHRI WASEEM AHMED, ACCOUNTANT MEMBER:

The present appeal has been instituted by the assessee against the order of the learned Commissioner of Income Tax (Appeals) under the National Faceless Appeal Centre (hereafter the learned CIT(A), passed under section 250 of the Income Tax Act, 1963 (hereinafter the Act) dated 27.08.2025. 2. At the outset, we note that the assessee has filed the present a

The order continues below.

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