JCIT (OSD) Vs Raj Surendra Mohan Hajela (ITAT Pune)
The case of JCIT (OSD) vs. Raj Surendra Mohan Hajela before ITAT Pune concerns the denial of Foreign Tax Credit (FTC) due to a delay in filing Form 67. The assessee, a tax resident of both India and the USA, claimed FTC of ₹4.32 crores in his tax return for AY 2021-22. While Form 67 was initially filed within the prescribed time, an inadvertent error led to the mention of the wrong assessment year. A corrected form was subsequently submitted after the extended due date, but the Centralized Processing Centre (CPC) denied the claim, citing non-compliance with Rule 128(9) of the Income Tax Rules, 1962. Despite the assessee’s rectification applications, the claim was rejected. However, the CIT(A)/NFAC ruled in favor of the assessee, allowing the FTC claim, leading the Revenue to challenge the decision before ITAT Pune.
The Tribunal reviewed precedents, including decisions from the Hyderabad and Bangalore Benches, which held that filing Form 67 is directory, not mandatory. Citing rulings that supported taxpayers in similar circumstances, ITAT Pune found no justification for denying FTC solely due to a delayed form submission. The Tribunal emphasized that the Double Taxation Avoidance Agreement (DTAA) overrides domestic tax rules, supporting the assessee’s entitlement to FTC. Consequently, ITAT Pune restored the case to the Assessing Officer for verification of Form 67 and directed appropriate relief. The Revenue’s appeal was allowed for statistical purposes.
