Foreign Tax Credit Cannot Be Rejected as Late Form 67 Filing Does Not Bar Relief: ITAT Surat

Kamleshkumar Rameshbhai Gandhi Vs DCIT (ITAT Surat)

The Income Tax Appellate Tribunal (ITAT), Surat Bench, allowed the assessee’s appeal and held that Foreign Tax Credit (FTC) cannot be denied merely because Form No. 67 was filed after the due date prescribed under Section 139(1) of the Income-tax Act. The case concerned an individual employed with Shell Energy Pvt. Ltd. who was on a long-term international assignment in Iraq. For Assessment Year 2019-20, the assessee filed the original return on 30 August 2019 and subsequently filed a revised return on 16 April 2020 along with Form No. 67 claiming FTC of ₹10,06,042. The revised return was processed under Section 143(1), and the FTC claim was denied on the ground that Form No. 67 had been filed belatedly.

The assessee’s appeal before the Additional/Joint Commissioner of Income Tax (Appeals) was dismissed, and the denial of FTC was upheld. The matter then reached the ITAT.

The Tribunal noted that there was no dispute regarding the delayed filing of Form No. 67. However, it relied on an earlier decision of the Surat Bench in Sanjay Patil v. AO, which in turn had followed the Bangalore Bench ruling in Brinda Rama Krishna. Those decisions had held that Rule 128(9) of the Income Tax Rules does not provide for disallowance of FTC merely because Form No. 67 is filed after the due date. They further held that filing Form No. 67 is a procedural or directory requirement rather than a mandatory condition for claiming FTC.