Mumbai ITAT allows foreign tax credit despite late Form 67 filing under Rule 128(9) before assessment completion

ITAT Mumbai held that assessee is eligible for foreign tax credit despite belated filing of Form No. 67 after due date but before completion of assessment. The tribunal distinguished between violation of Act provisions versus rules, noting that Rule 128(9) prescribing filing deadline carries no consequence for non-compliance. Following precedent in Sonkashi Sinha, the tribunal allowed foreign tax credit claim made with revised return and remanded matter to AO with direction to grant credit. Appeal allowed for statistical purposes.

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Issues involved:
The appeal challenges the order passed by the Ld. Commissioner of Income Tax (Appeals) regarding the denial of relief under Section 90 of the Income Tax Act and the consequential levy of interest under Section 234B and 234C of the Act for the Assessment Year 2020-2021.

Relief u/s 90 of the Act denied:
The Appellant contested the denial of relief under Section 90 of the Act, claiming that the Form 67 was filed along with the revised return of income, and thus the relief should not have been denied. The CIT(A) upheld the denial citing the failure to file Form 67 before the due date of filing the return of income. However, the Tribunal, following judicial precedents, remanded the issue back to the Assessing Officer to grant foreign tax credit to the Appellant as per the previous decisions, as Form No. 67 was filed before the completion of the assessment for the relevant assessment year.

Consequential levy of interest u/s 234B and 234C of the Act:
The Appellant challenged the confirmation of the levy of interest under Section 234B and 234C of the Act, arguing that the amounts levied were higher than what was stated in the revised return of income. The Tribunal directed the Assessing Officer to re-compute the interest under Section 234B and 234C of the Act in accordance with the law.

General:
The third ground raised by the Appellant was of a general nature and was disposed of accordingly. The Tribunal allowed the appeal for statistical purposes, with the first ground being allowed for the Appellant's benefit, and the second ground being disposed of as consequential. The order was pronounced on 22.12.2023.

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