JAYALAKSHMY VENKATARAMAN,CHENNAI vs. ITO, NCW-17(6), CHENNAI

This is an appeal preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)/Addl./JCIT(A)-1, (hereinafter referred to as “the Ld.CIT(A)”), Bangalore, dated 24.10.2024 for the Assessment Year (hereinafter referred to as "AY”) 2019-20.

The main grievance of the assessee is against the action of the Ld.CIT(A) dismissing the appeal by which action of the CPC u/s.143(1) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act‘) was confirmed by denying Foreign Tax Credit (FTC) u/s.90 of the Act.

The brief facts are that the assessee is an individual has earned, inter alia, income from outside India as well as Long Term Capital Gain which according to her was taxed in the foreign country and the assessee had filed her return of income (RoI) u/s.139(1) of the Act i.e. within the time limit specified therein for AY 2019-20 but since Form No.67 was not filed along with the CPC didn’t allow the claim of FTC to the tune of Rs.1,29,992/- by intimation order dated 16.02.2021 passed u/s.143(1) of the Act. According to the Ld.AR, the assessee noticing that for not filing Form No.67, the CPC has denied the claim immediately uploaded and preferred an appeal before the Ld.CIT(A) who was pleased to dismiss the same on the ground that the assessee ought to have filed Form No.67 along with RoI.

Aggrieved by the aforesaid action of the Ld.CIT(A), the assessee is before us.

We have heard both the parties and perused the material available on record. We note that the assessee is an individual having salary income, Long Term Capital Gains & income from other sources. During the AY 2019-20, the assessee received Long Term Capital Gains income from outside India which was taxed there and assessee filed belatedly Form No.67 for filing the relief u/s.90 of the Act which was denied by the CPC as well as the Ld.CIT(A), because, the assessee didn’t file Form No.67 along with RoI. The only question is whether belatedly filing of Form No.67 is directory or mandatory. In this regard, we note that the issue is no longer res integra. The Hon’ble Madras High Court in the case of Duraiswamy Kumaraswamy v. PCIT in WP No.5834 of 2022 dated 06.10.2023 had an occasion to examine the action of the Tribunal allowing the similar claim of assessee wherein it was held that filing of this Form in terms of Rule 128 was only directory in nature and held that the rule is only for the implementation of provisions of the Act and it would always be directory in nature. Similar view has been taken by the Tribunal in the case of Satishkumar Ekambaram v. ITO [ITAT Chennai] dated 04.11.2024 in ITA No.2069/Chny/2024.