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Income Tax Appellate Tribunal, PUNE BENCHES “B” :: PUNE
Before: SHRI S.S.GODARA & DR. DIPAK P. RIPOTE
।आयकर अपीलीय अिधकरण ”बी” �ायपीठ पुणेम�। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “B” :: PUNE BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.898/PUN/2023 िनधा�रण वष� / Assessment Year : 2021-22 Pramod Tarade, The Commissioner of A-2, Sai Ameya CHS, Plot V Income Tax,[NFAC]. No.28, Sector-12, Kharghar, s Panvel, Raigad – 410210. Maharashtra. PAN: AEVPT9870L Appellant/ Assessee Respondent /Revenue Assessee by Shri Tarun G – AR Revenue by Shri Sourabh Nayak – Addl.CIT(DR) Date of hearing 15/02/2024 Date of pronouncement 22/02/2024 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This is an appeal filed by the assessee against the order of Ld.Commissioner of Income Tax(Appeal)[NFAC], Delhi under section 250 of the Income Tax Act, 1961 for A.Y.2021-22 passed on 24.06.2023 emanating from order under section 154 of the Income Tax Act, 1961 dated 29.12.2022. The grounds of appeal raised by the assessee are as under : “1. The Order of the CIT(A) NFAC, dt. 24-06-2023 for the A.Y. 2021 -22 is contrary to law and facts and in the circumstances of
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the case.
The CIT(A) NFAC, had erred in passing an order and disallowing the claim of relief of foreign tax credit u/s 90 of the income tax act, 1961 amounting to Rs. 1,02,316/- on the Foreign Salary income of Rs. 4,10,941/- which has been doubly taxed in the Norway and in India.
The CIT (A) NFAC, has not disputed the allowability of the foreign tax credit. He has only disallowed the credit on the ground that form 67 has not been filed on or before the due date of filing of return of income as per rule 128 (9) of the income tax rules, 1962.
The CIT (A) NFAC failed to appreciate the fact that the appellant on realizing the mistake of not filing form 67 for assessment year 2021-22, had filed the form on 04-08-2022 being later then the time limit specified Under rule 128 (9) of the income tax rules, 1962. The act of late filing of form 67 clearly shows the intention of the appellant to rectify the procedural lapse that was made at the time of filing the return of income u/s 139 (1) of the income tax act 1961 for claiming the foreign tax credit.
The ACIT failed to appreciate that the evidence filed in support of the stand were not considered and looked into and ought to have appreciated that non recording of findings in relation to the evidence filed in support would vitiate the related findings in the impugned order.
The CIT (A) NFAC, had failed to appreciate that for
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claiming the Foreign Tax Credit the DTAA prevails over the Domestic Act hence disallowing the Foreign Tax Credit on account of belated filing of Form 67 was wrong, erroneous, unjustified, incorrect, invalid and not sustainable both on facts and in law.
The CIT (A) NFAC failed to appreciate the decisions relied by the Appellant which was not considered while disallowing the Foreign Tax Credit was wrong, erroneous, unjustified, incorrect, invalid and not sustainable both on facts and in law.
The CIT (A) NFAC failed to appreciate that the draft assessment order under consideration was passed out of time, invalid, passed without jurisdiction and not sustainable both on facts and in law.
The assessee/objector craves leave to file additional grounds, written submissions, the details/information for the determination of the disputes resolution and case law compilations at the time of hearing.”
Brief facts of the case : 2. In this case, assessee filed return of income for A.Y.2021-22 within the extended due date of 31.12.2021 prescribed under section 139(1) of the Act. Assessee filed return of income on 25.11.2021. Assessee had claimed foreign tax credit of Rs.1,02,316/- under section 90 of the Act. However, requisite Form No.67 which was mandatory as per Rule 128 of Income Tax
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Rules was not filed along with return of income within the due date mentioned under section 139(1) of the Act. The return of income was processed under section 143(1) on 22.03.2022. Assessee was denied credit for foreign tax credit on the ground that Form No.67 was not filed. The assessee filed rectification application under section 154 of the Income Tax Act. Meanwhile, on 04.08.2022 assessee filed Form No.67. Assessee’s rectification application was dismissed on 29.12.2022. Aggrieved by the order under section 154 of the Act, the assessee filed appeal before the ld.Commissioner of Income Tax(Appeals). The ld.CIT(A) after analysing the Rule 128 dismissed the appeal of the assessee. The relevant paragraph 4.11 and 4.12 of the ld.CIT(A)’s is reproduced here as under : “4.11. As noted before, the appellant had filed the return of income on 25.11.2021 well within the prescribed due date of 31.12.2021 under Section 139(1) of the Act. However, Form 67 has been filed only on 04.08.2022, after the end of the relevant Assessment Year, i.e., 31.03.2022.
4.12. Thus, the appellant had failed to fulfil the twin conditions prescribed as per the amended Rule 128(9), and was therefore not entitled to claim the credit of Foreign Tax Credit under Section 90 of the Act. The non-granting of FTC by CPC is as per intimation issued u/s. 14391) was found to be strictly n accordance with the provisions of the Act and Rules as noted above. As there was no mistake apparent from records in the intimation issued u/s. 143(1), appellant’s 4
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rectification request filed u/s. 154 seeking granting of FTC was also rejected by CPC vide the impugned order.
4.14. In view of the above facts and provisions of law, the intimation issued u/s. 154 r.w.s.143(1) by CPC does not warrant any interference.”
Aggrieved by the order of the ld.CIT(A), the assessee has filed appeal before this Tribunal. Submission of ld.Authorised Representative(ld.AR) : 4. The ld.AR filed a written submission as under : “1. The Appellant had filed the income tax return for the Assessment Year 2021-22 vide Acknowledgement Number 893506850251121 declaring the adjusted total income of Rsl5,10,370/- including the foreign Salary income amounting to Rs 4,10,941/-.The copy of the ITR Filed ,ITR V and the computation of income have been annexed in Annexure I.
The Appellant was resident and ordinary resident during the AY 2021-22. Hence the global income was offered in the return of income filed which includes therein Salary Income earned from Norway.
The Salary income earned from Norway was subject to withholding of tax as per the Norway tax laws. The Appellant being resident in India had included this Salary income in the return of income filed and claimed the foreign tax credit as per Section 90 of Income Tax Act 1961. The proof of withholding tax have been annexed in Annexure II.
The Return of Income filed by the Appellant was processed and intimation U/S 143(1) dated 22/03/2022 was issued in which demand 5
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due of Rs 1,18,000/- was raised. This includes interest of Rs 15,659/- and Tax demand of Rs 1,02,341/-. The copy of 143(1) intimation has been enclosed in Annexure - III in which the Foreign Tax Credit claimed was not allowed which subsequently was noticed that the Form 67 was not filed.
The Appellant filed the form 67 along with the withholding Tax proof vide acknowledgement No 409237730040822 dated 04/08/2022 towards foreign tax credit claimed in the return of income for salary income earned at Norway. Copy of the form 67 has been enclosed in Annexure – IV
The appellant had filed rectification U/S 154 dated 29/12/2022 against the intimation u/s 143(1) stating that the intimation has an apparent mistake by not giving the foreign tax credit towards the foreign salary income disclosed in the return of income filed since the Form 67 was also filed.
The petition filed u/s 154 filed by the Appellant was rejected without providing the proper opportunity and also without proper reasoning vide rejection of order u/s 154 dated 29/12/2022. Copy of the 154 order is given in Annexure - V.
The Appellant had claimed the Foreign Tax Credit in the Return of Income and the Form 67 could not be filed due to the covid lockdown which was subsequently filed against which petition u/s 154 was filed.”
Submission of ld.Departmental Representative(ld.DR) : 5. The ld.DR submitted that there was no mistake apparent from record in the order under section 143(1) of the Act. Hence,
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ld.CIT(A) has rightly upheld the order under section 154 of the Act. Findings & Analysis : 6. We have heard both the parties and perused the records. It is an admitted fact by the assessee that assessee had not filed Form No.67 for A.Y.2021-22 i.e.the year under consideration. Assessee claims that assessee has inadvertently selected the dropdown box for A.Y.2020-21. Therefore, foreign tax credit was not allowed under section 143(1) of the Act as there was no Form No.67. As per Rule 128 of the Income Tax Rules, it is mandatory to file Form No.67 along with return of income within the due date mentioned under section 139(1) of the Act. The assessee filed a rectification application and requested to grant foreign tax credit. Admittedly, subsequently i.e. o 04.08.2022 assessee filed Form No.67. Thus, admittedly Form No.67 was not filed within the time allotted under section 139(1) of the Act, but it was filed much beyond the prescribed time limit.
6.1 Assessee had filed a rectification application under section 154 of the Act. Under section 154, only a mistake which is apparent from record can be rectified. In this case, at the time of passing the order under section 143(1) of the Act, admittedly Form
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No.67 was not available before the concerned authority passing the order under section 143(1), as Form No.67 was filed much beyond. The order under section 143(1) was passed on 22.03.2022, however, Form No.67 was filed on 04.08.2022. Thus, at the time of passing order under section 143(1), there was no Form No.67 before the concerned authorities. Therefore, foreign tax credit was denied to the assessee. In this case, there is no mistake apparent from the record. Therefore, there is no question of rectification.
Meaning of Mistake Apparent from record: 6.2 The Hon’ble Supreme Court in the case of ACIT Vs. Saurashtra Kutch Stock Exchange Ltd 305 ITR 227 (SC)/[2008] has held as under : Quote ,“37. In our judgment, therefore, a patent, manifest and self- evident error which does not require elaborate discussion of evidence or argument to establish it, can be said to be an error apparent on the face of the record and can be corrected while exercising certiorari jurisdiction. An error cannot be said to be apparent on the face of the record if one has to travel beyond the record to see whether the judgment is correct or not. An error apparent on the face of the record means an error which strikes on mere looking and does not need long-drawn-out process of reasoning on points where there may conceivably be two opinions. Such error should not require any extraneous matter to show its incorrectness. To put it differently, it should be so manifest and clear that no Court would permit it to remain on record. If the view accepted by the Court in the original judgment is one of the possible views, the case cannot be said to be covered by an error apparent on the face of the record. ” Unquote.
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Thus, the Hon’ble Supreme Court has held that mistake should be self-evident to invoke rectification. In the case of assessee, there is no mistake apparent from the record in the order under section 143(1) of the Act. The assessee had filed Form No.67 on 04.08.2022 and wants that said Form No.67 shall be considered under section 154 of the Act. The said Form No.67 was not available when order under section 143(1) was passed. Hence, it cannot be considered under section 154 of the Act. Accordingly, we are of the opinion that there is no mistake apparent from the record. Therefore, we uphold the order under section 154 of the Act and order of ld.CIT(A). Accordingly, grounds of appeal raised by the assessee are dismissed. Though assessee has raised 09(nine) grounds, but no specific pleading was made with reference to other grounds other than requesting to consider Form No.67. Therefore, all other grounds are dismissed. The case law relied by assessee are distinguishable on facts.
In the result, appeal of the assessee is dismissed. Order pronounced in the open Court on 22nd February, 2024.
Sd/- Sd/- (S.S.GODARA) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER
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पुणे / Pune; �दनांक / Dated : 22nd Feb, 2024/ SGR* आदेशक��ितिलिपअ�ेिषत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. िवभागीय�ितिनिध, आयकर अपीलीय अिधकरण, “बी” ब�च, 5. पुणे / DR, ITAT, “B” Bench, Pune. गाड�फ़ाइल / Guard File. 6. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune.