Tabassum Abdulla Inamdar Vs DCIT (ITAT Mumbai)
Delay in Form 67 Not Fatal – Foreign Tax Credit to be Allowed – Rule 128 Held Directory – ITAT Mumbai
CPC denied foreign tax credit (FTC) of ₹90,208 due to delay in filing Form 67 and CIT(A) upheld denial relying on Rule 128. Assessee had already disclosed foreign dividend income and FTC claim in ROI and later filed Form 67 along with rectification u/s 154.
ITAT held that filing of Form 67 is directory and Rule 128 does not prescribe denial of FTC for delay. Tribunal observed that Sec 90/DTAA provisions prevail and procedural lapse cannot defeat substantive tax credit claim, relying on Sonakshi Sinha and other decisions. Matter remanded to JAO only for limited verification and to grant FTC as claimed. Assessee appeal allowed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal filed by the assessee is against the order of National Faceless Appeal Centre (NFAC), Delhi, vide order no. ITBA/NFAC/S/250/2025-26/1081126257(1), dated 24.09.2025, passed against the order by Assessing Officer, u/s. 154 of the Income-tax Act (hereinafter referred to as the “Act”), dated 25.03.2025 for Assessment Year 2018-19.
2. Grounds taken by assessee are reproduced as under:
1. On facts and in law, the Ld. Commissioner of Income Tax (Appeals) had erred in not allowing the credit of foreign tax credit claimed of Rs. 90,208/-Under the facts and circumstances of the matter, the claim of the appellant ought to have been allowed.
2. The Appellant craves 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, so as to enable the Hon’ble ITAT to decide this appeal according to law.
3. The only issue involved in the present appeal is in respect of grant of credit for foreign taxes paid by the assessee but denied owing to delay in filing of form 67 for claiming such credit. Facts of the case are that assessee filed her return of income on 29.08.2018, reporting total income at Rs. 1,43,43,890/-. In the year under consideration, assessee had received dividend income from foreign shares amounting to Rs. 3,58,649/- duly reported in her return in ‘Schedule OS: Income from Other Sources.’ Claim for taxes paid outside India was also furnished in ‘Schedule TR’ and also details of income from outside India and tax relief thereon were duly reported in ‘Schedule FSI’ of the return filed by the assessee. All of these are placed on record in the paper book and stand uncontroverted.
