Shrinivasan Ranganathan Vs ACIT (ITAT Chennai)
The Chennai ITAT held that a lower Foreign Tax Credit (FTC) claim made in Form 67 cannot permanently disentitle an assessee from claiming the correct FTC amount when the relevant foreign tax payment details are already on record. The Tribunal observed that delay in filing or mistakes in Form 67 are merely procedural lapses and cannot override substantive relief available under sections 90/91 of the Act.
In this case, the assessee originally claimed FTC of ₹8.70 crore in Form 67 filed along with the belated return. During scrutiny, additional LTCG income of ₹3.83 crore was offered, resulting in eligibility for enhanced FTC of ₹9.78 crore. However, the AO restricted the FTC to the original amount mentioned in Form 67 on the ground that no revised Form 67 had been filed.
The Tribunal noted that the AO himself subsequently rectified the mistake u/s 154 and granted the full FTC of ₹9.78 crore by relying on the Madras High Court ruling in Venkatanarayanan Somayaji Lakshminarasimha v. PCIT, which held that Rule 128 and Form 67 requirements are directory in nature.
The ITAT emphasised that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice must prevail. Since the AO had already granted the correct FTC through rectification and the taxes paid in the foreign country were duly reflected in Form 67 itself, the CIT(A)’s order denying enhanced FTC was quashed.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, dated 25.11.2025 passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2023-24.
