KANURI APPALA RAJU,ODISHA vs. ITO WARD 1(1), JAMSHEDPUR

ITA 299/RAN/2025Status: DisposedITAT Surat25 September 2026AY 2020-215 pages
AI SummaryAllowed

What were the facts?

The assessee, Kanuri Appala Raju, filed an appeal against the order of the ld. Addl/JCIT(A), Mysore, for Assessment Year 2020-21. The assessee, a Resident and Ordinarily Resident (ROR) of India, had salary income of INR 77,43,692/- from his employment with Tata Steel Canada. This income was offered to tax in India and also taxed in Canada. The assessee claimed Foreign Tax Credit (FTC) of INR 12,11,065/- under Section 90 of the Income Tax Act, 1961, read with Articles 23 and 4 of the India-Canada DTAA. The assessee filed his original return of income on 31/03/2021 and Form 67 on 01/04/2021, along with proof of Canadian taxes paid. However, due to a technical glitch, Form 67 was allegedly filed only on 01/04/2024. The DDIT(CPC), Bengaluru, in an intimation under Section 143(1) dated 24/12/2021, raised a demand of INR 16,73,590/-, denying the FTC claim. The ld. CIT(A) dismissed the assessee's appeal.

What did the Tribunal hold?

The Tribunal held that the assessee is entitled to the Foreign Tax Credit (FTC) amounting to INR 12,11,065/-. The reasoning was based on the principle that the Double Taxation Avoidance Agreement (DTAA) provisions override Section 90 of the Income Tax Act, 1961, as they are more beneficial to the assessee. The Tribunal respectfully followed decisions of its Coordinate Benches, which have held that assessees are entitled to FTC benefits when DTAA provisions are more beneficial. The issue regarding the levy of interest under Sections 234A, 234B, and 234C was not expressly decided by the Tribunal. The operative direction was to allow the FTC benefit.

What were the issues?

1. Whether, on the facts and circumstances of the case and in law, the CPC/CIT(A) erred in not allowing the foreign tax credit of INR 12,11,065/- claimed under Section 90 of the Act, read with Article 23 and Article 4 of the India-Canada DTAA on salary income of INR 77,43,692/-, considering that filing of Form 67 within the prescribed time is directory and not mandatory, and that DTAA provisions override domestic law? - Assessee's contention: Filing of Form 67 within the prescribed time is directory, not mandatory. DTAA provisions override domestic law. Relied on Hertz Software India (P) Ltd. vs ACIT, Debanjan Chatterjee vs DDIT, Timirbaran Mazumder vs DCIT/ACIT, Ms. Brinda Ramakrishna vs ITO, and Power and Energy Consultants India (P) Ltd. vs ITO. - Revenue's contention: Supported the orders of the lower authorities. 2. Whether, on the facts and circumstances of the case and in law, the CPC/CIT(A) erred in not levying interest under Section 234A, 234B and 234C of the Act? - Assessee's contention: Not recorded in the judgment. - Revenue's contention: Not recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 90,Section 139(1),Section 143(1),Section 234A,Section 234B,Section 234C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RANCHI BENCH, RANCHI

Before: SHRI RATNESH NANDAN SAHAY & SMT. RAJANI GUDURI

For Appellant: Shri Ankit Sahni, Advocate
For Respondent: Md. Shadab Ahmed, CIT-DR
Hearing: 08/09/2026Pronounced: 25/09/2026

PER: BENCH

1.

This appeal by the assessee is directed against the order of the ld. Addl/JCIT(A), Mysore (in short, the ld. CIT(A) dated 27/06/2025 for the Assessment Year (AY) 2020-21 wherein the assessee has raised following grounds of appeal:

"

1.

That on the facts and circumstances of the case and in law, the CPC/CIT(A) has erred in not allowing the foreign tax credit of INR 12,11,065 claimed under Section 90 of the Act, read with Article 23 and Article 4 of the India- Canada DTAA on salary income of INR 77,43,692/- double taxed in India and Canada, without appreciating that filing of Form 67 w

The order continues below.

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