Parag Gupta Vs ITO (ITAT Delhi)
The appeal arose from the order of the JCIT(A) affirming the CPC’s intimation under Section 143(1) for AY 2021-22, whereby foreign tax credit (FTC) of ₹13,91,287 claimed under Sections 90/90A was denied on the ground that Form No. 67 had not been filed within the due date prescribed under Section 139(1). The assessee, a resident salaried employee of Amazon Seller Services Pvt. Ltd., had earned salary income in both India and the USA, offered his global income to tax in India, paid tax in the USA, and claimed FTC in respect of those taxes. Although the return of income was filed on 24.12.2021, Form No. 67 was filed on 10.01.2022, within the time available under Section 139(4) but after the due date under Section 139(1).
The Tribunal noted that there was no dispute regarding the assessee’s entitlement to FTC or the payment of taxes in the USA. The only dispute was whether delayed filing of Form No. 67 disentitled the assessee to the credit claimed.
The Tribunal relied on the decision of the Bengaluru Bench of the Tribunal in Brinda Ramakrishna vs ITO, which examined Rule 128 of the Income-tax Rules governing FTC. The extracted decision recorded the assessee’s submissions that Section 90 and the applicable DTAA conferred the substantive right to FTC, that Rule 128 only prescribed the procedure for claiming such relief, and that Rule 128(9) did not expressly provide for denial of FTC if Form No. 67 was filed after the due date under Section 139(1). It also referred to decisions of the Supreme Court and various High Courts concerning procedural requirements and the overriding effect of DTAAs.
