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Income Tax Appellate Tribunal, DELHI BENCH ‘C’, NEW DELHI
Before: SH. N. K. BILLAIYA & SH.KUL BHARAT
This appeal by the assessee is preferred against the order dated 01.12.2022 by NFAC, Delhi pertaining to A.Y. 2019-20.
The grievance of the assessee read as under:-
That on the facts and circumstances of the case and in law, the NFAC erred in 1. upholding the action of Centralized Processing Center (‘CPC’) by not allowing the benefit of foreign tax credit (‘FTC’) of INR 4,81,954 claimed by the Appellant in its income tax return filed in India.
That on the facts and circumstances of the case and in law, the NFAC/CPC 1.1 have erred in not considering that filing of Form 67 is only a procedural/directory requirement and there is no rule or condition which provides for disallowance of FTC.
1.2 That on the facts and circumstances of the case and in law, the NFAC/CPC have erred in not appreciating the amendment in Rule 128(9) of Income Tax Rules, 1962 which allows filing of Form 67 even after the due date of filing the income tax return.
That on the facts and circumstances of the case and in law, the intimation 2. issued under section 143(1) of the Act by CPC is bad in law and liable to be quashed inasmuch as the intimation has sought to make adjustment on account of a debatable issue without giving any opportunity of being heard to the Appellant.
That on the facts and circumstances of the case and in law, the CPC has 3. erred in levying interest under sections 234B and 234C of the Act.
The Appellant prays for leave to add, alter, vary, omit, substitute or amend the above grounds of appeal, at any time before, or at, the time of hearing of the appeal.
Briefly stated the facts of the case are that during the year under consideration the assessee was employed with Midland Credit Management India Private Limited and is qualified as resident and ordinarily resident in India.
During the year the assessee has received income on account of employee share scheme and such income pertains to the assignment period of the assessee in Australia. The assessee showed this income in his return of income and the said income was also taxed in Australia.
The assessee claimed Foreign Tax Credit as per the provisions of section 90 of the Act read with the India- Australia DTAA.
The Foreign Tax Credit was not given to the assessee as he did not file Form 67 though the assessee filed Form 67 on the income tax portal on 17.01.2022 but because the same was not filed with the return of income FTC was denied.
The assessee agitated the matter before the CIT(A) but without any success.
Before us the Counsel for the assessee submitted the order u/s. 119(2)(b) of the Act by which the CBDT has condoned the delay in filing Form 67.
The DR fairly stated that the issue may be restored to the files of the AO for verification.
We have carefully considered the orders of the authorities below. We find that the CBDT vide order dated 20.06.2023 accepting the cause for the delay in filing Form 67 at para -4 of its order held as under :-
“4. Upon consideration of the facts and circumstances of the case and report of the jurisdictional Income Tax Authorities, CBDT, in order to avoid genuine hardship to the petitioner, in exercise of powers under Section 119(2)(b) of the Income Tax Act, 1961 authorities the Assessing Officer concerned to admit the above-mentioned Form No.67 for A.Y.2019-20 filed by the petitioner 17.01.2022 even though the said Form No.67 was filed by the petitioner after the expiry of the period specified under Rule 128(9) of the Income-tax Rules, 1962 and deal with the same on merits in accordance with law.”
In the light of the above we restore the issue to the files of the AO. The AO is directed to decide the issue afresh in the light of the directions of the CBDT (supra).
In the result, the appeal of the assessee is allowed for statistical purpose.
Decision announced in the open court on 31.08.2023.