Atanu Mukherjee Vs ITO (ITAT Kolkata)
The Income Tax Appellate Tribunal (ITAT), Kolkata, allowed the assessee’s appeal against the order of the Commissioner of Income Tax (Appeals), NFAC, for Assessment Year 2020-21, which had upheld the denial of Foreign Tax Credit (FTC) solely on the ground of delayed filing of Form 67.
The assessee, an individual and tax resident of India, filed a belated return of income on 31 March 2021 declaring total income of ₹93,44,290 and claimed FTC of ₹20,92,790 under Section 90(2) of the Income-tax Act. The return was processed under Section 143(1), and while the returned income was accepted, the FTC claim was disallowed because Form 67, prescribed under Rule 128 of the Income-tax Rules, 1962, had been filed after the prescribed due date. As a result, a tax demand of ₹28,48,010 was raised. The CIT(A) affirmed the Assessing Officer’s decision, holding that the assessee had not fulfilled the conditions prescribed under Rule 128 read with Section 90(2) for claiming FTC.
Before the Tribunal, it was noted that the assessee had worked with employers in both the United States and India during the relevant previous year, and the salary earned for services rendered in the United States had been offered to tax in India. The assessee claimed FTC in respect of taxes paid in the United States under the India–USA Double Taxation Avoidance Agreement (DTAA), but the claim was rejected solely because Form 67 had not been filed within the due date prescribed under Rule 128(9).
