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Facts
The assessee's claim for Foreign Tax Credit (FTC) of Rs.8,60,645/- for AY 2019-20 was denied under Section 143(1) solely due to the belated filing of Form No.67. There was a delay of 48 days in filing the appeal before the Tribunal and a delay of 2 years 6 months in filing the appeal before the CIT(A).
Held
The Tribunal condoned both delays, finding 'reasonable cause'. It held that the filing of Form No.67 is directory and not mandatory, thus the FTC claim cannot be denied merely due to belated filing. The issue was remitted back to the Jurisdictional Assessing Officer for fresh consideration on merits after providing the assessee a reasonable opportunity of hearing.
Key Issues
Whether the delays in filing appeals before the Tribunal and CIT(A) should be condoned, and whether Foreign Tax Credit can be denied solely for belated filing of Form No.67, considering its directory nature.
Sections Cited
250, 143(1)
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Income Tax Appellate Tribunal, PUNE BENCHES “B”, PUNE
Before: DR.MANISH BORAD & MS. ASTHA CHANDRA
आदेश / ORDER
PER DR. MANISH BORAD, ACCOUNTANT MEMBER :
The captioned appeal at the instance of assessee pertaining to assessment year 2019-20 is directed against the order dated 30.08.2024 passed by Addl.JCIT(A), Jodhpur u/s.250 of the Income Tax Act, 1961 ( in short ‘the Act’) arising out of the Intimation order dated 28.03.2021 passed u/s.143(1) of the Act.
Registry informed that there is delay of about 48 days in filing the appeal before the Tribunal. An affidavit explaining the delay has been filed by the assessee stating the following reasons:
“1. That, the orders of the Learned Commissioner of Income Tax (Appeals) [CIT(A)), against which the present appeals have been preferred, arc dated 30.08.2024 and were served through insertion on the e-filing portal. 2. That, an appeal was filed before the Hon'ble Income Tax Appellate Tribunal (ITAT) on 29.10.2024. However, due to a technical glitch, the necessary enclosures though uploaded did not get reflected on the site, resulting in the rejection of the appeal for non-compliance.
3. That, I did not receive any email or physical notice regarding the said deficiency. It was only on 17.12.2024, during a routine check of the ITAT dashboard by my Chartered Accountant, that the issue came to my attention. The fresh appeal was promptly refiled on 18.12.2024 upon discovery of the omission.
4. That, I respectfully submit that the delay in filing the appeal was neither due to negligence nor any disregard for the prescribed legal process. The appeal against the orders of the Ld. CIT(A) dated 30.08.2024 has been filed with a delay of approximately 48 days.
5. That, in view of the aforementioned circumstances, I humbly request that the Hon'ble Tribunal condone the delay and admit the appeals for adjudication on merits. The balance of convenience lies in my favor.”
After going through the averments made in the condonation petition, we find that there was ‘reasonable cause’ which prevented the assessee in filing the appeal within the stipulated time. Therefore, the delay of 48 days occurred in preferring the appeal before the Tribunal is condoned placing reliance on the decision of Hon’ble Supreme Court in the case of Collector Land Acquisition Vs. MST Katiji (1987) 167 ITR 471 SC and proceed to adjudicate the appeal.
The only grievance of the assessee is that lower authorities have not granted Foreign Tax Credit (FTC) solely on account of delay in furnishing Form No.67.
On merits of the case, Ld. Counsel for the assessee referred to the decision of Coordinate Bench, Mumbai in the case of Tom Thomas Vs. ADIT(CPC), Bangalore in order dated 29.11.2022 and submitted that filing of Form No.67 is directory in nature and even if Form No.67 is filed belatedly then also the claim of the assessee for Foreign Tax Credit cannot be denied.
On the other hand, ld. Departmental Representative supported the orders of the lower authorities.
We have heard the rival contentions and perused the record placed before us. In the instant appeal, Foreign Tax Credit claim of Rs.8,60,645/- has not been allowed to the assessee on account of delay in filing of Form No.67 which contains the details of FTC. We note that the Intimation u/s.143(1) was passed on 28.03.2021 denying the claim of FTC made by the assessee and at that point of time, country was passing through covid-19 pandemic and restrictions were put in and almost two years period have been removed out of the limitation period by the Hon’ble Apex Court in the case of Cognizance for Extension of Limitation In re (2022) 441 ITR 722 (SC). The assessee has filed the appeal before ld.CIT(A) on 06.12.2023 and therefore there is a delay of about 2 years 06 months. We further observe that in the impugned order ld.CIT(A) has not dealt with the merits of the case on account of delay in filing the appeal by about 2 years 06 months. Assessee has filed the condonation application before ld.CIT(A) stating that notices sent electronically came to his notice only after receipt of notice of arrears of demand in physical form in the last week of October, 2023. These are the main reasons which led the assessee in not filing the appeal within the stipulated time. We therefore considering the facts of the case and the reasons stated by the assessee in the condonation application filed before ld.CIT(A) deem it proper to condone the delay in filing of appeal before ld.CIT(A). Further, since the issue of FTC has been consistently dealt by this Tribunal in plethora of decisions and a view has been taken that filing of Form No.67 is directory and not mandatory in nature and therefore delay in filing of such form should not be taken as a ground for denying the claim of FTC.
Considering the facts of the case, we deem it proper to restore the issue back to the file of Jurisdictional Assessing Officer before whom the assessee shall file all necessary details in support of his claim of FTC which have also been placed in the paper book filed before us. Ld. JAO after examining the veracity of the claim shall allow the claim of FTC after providing reasonable opportunity of hearing to the assessee. Effective grounds of appeal raised by the assessee are allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced on this 02nd day of May, 2025.