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Before: Shri S.S. Viswanethra Ravi & Shri Jagadish
PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER:
This appeal filed by the assessee is directed against the order dated 14.02.2025 passed by the Addl./JCIT(A)-5, Mumbai for the assessment year 2023-24. 2. The assessee raised 2 grounds of appeal amongst which, the only issue emanates for our consideration as to whether the Id. CIT(A) is justified in confirming the disallowance made by the Assessing Officer towards foreign tax credit claimed at ₹.19,84,504/- under section 90 of the Income Tax Act, 1961 [“Act” in short] in the facts and circumstances of the case.
We note that the assessee filed his return of income for AY 2023-24 declaring total income of ₹.64,07,353/- after claiming relief under section 90 of the Act and however, not filed the prescribed Form 67 for claiming the foreign tax credit. The Assessing Officer, CPC passed intimation under section 143(1) of the Act dated 29.08.2024 rejected foreign tax credit claimed under section 90 of the Act. On appeal, the Id. CIT(A) confirmed the denial of foreign tax credit by following the judgement of the Hon'ble apex Court in the case of PCIT v. Wipro Limited in Civil Appeal No. 1449 of 2022, wherein, it was held that requirement of filing a declaration within a timeline is "mandatory" in nature and dismissed the appeal of the assessee.
The Id. AR Ms. N.V. Lakshmi, Advocate submits that the assessee has very well filed Form 67 on 25.09.2024 and by oversight, the assessee could not file within due date of filing. She submits that the return of income of the assessee has been selected for scrutiny and the scrutiny proceedings are in progress. She further submits that pending scrutiny assessment, the assessee filed Form 67 before the Assessing Officer and moreover, along with intimation order, the assessee filed an appeal before the Id. CIT(A) to condone the delay in filing Form 67 and to grant relief. But, however, the Id. CIT(A) denied claim of foreign tax credit and dismissed the appeal by following the judgement in the case of PCIT v. Wipro Limited (supra), which is highly distinguishable. The Id. AR vehemently contended that filing of FTC in terms of Rule 128 of the Income Tax Rules is directory and by relying upon the decisions of the Hon'ble High Court of Madras in the case of Duraiswamy Kumaraswamy v. PCIT in W.P. 5834 of 2022 dated 06.10.2023 as well as in the case of Shri Kuthoore Natarajan Venkatasubramanian v. PCIT in W.P. No. 12578 of 2024 dated 26.09.2024, which is directly on the issue, prayed to follow the same and allow the grounds raised by the assessee.
The Id. DR Shri Vijay Kumar, JCIT relied on the order of the Id. CIT(A).
Heard both the parties and perused the material available on record. In this case, the assessee claimed FTC of ₹.19,84,504/- under section 90 of the Act. The return filed by the assessee on 23.07.2023 was processed under section 143(1) of the Act dated 29.08.2024 by denying the claim of foreign tax credit since the assessee could not file Form 67. Thereafter, the assessee filed Form 67 on 25.09.2024 belatedly. It is the submission of the assessee that the return of income of the assessee has been selected for scrutiny and the scrutiny proceedings are in progress. Meanwhile, against the intimation order, the assessee preferred an appeal before the Id. CIT(A). By referring to the judgement of the Hon'ble Supreme Court in the case of PCIT v. Wipro Limited (supra), holding that the requirement of filing a declaration within a timeline is “mandatory