Tribunal grants partial appeal, directs Assessing Officer on foreign tax credit. Interest levy remanded.

The Tribunal allowed the appeal partly for statistical purposes, directing the Assessing Officer to consider the claim of foreign tax credit upon acceptance of Form no.67. The grounds related to interest levy under section 234A were remanded for fresh adjudication, while those under sections 234B and 234C were allowed for statistical purposes. The decision was in line with prior rulings, emphasizing that filing Form no.67 before completion of assessment, albeit not in line with Rule 128(9), still entitles the taxpayer to foreign tax credit eligibility.

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Issues:
1. Denial of Foreign Tax Credit under section 90/90A due to delay in filing Form no.67

Analysis:
The appeal was filed challenging the order passed under section 250 of the Income Tax Act, 1961 by the Commissioner of Income Tax (Appeals). The assessee raised grounds against the denial of Foreign Tax Credit amount and the subsequent demand raised under section 143(1) of the Act. The primary contention was the denial of the credit due to the delay in filing Form no.67. The assessee argued that the provisions of Rule 128 cannot override the substantive provisions of section 90/90A of the Act. The learned CIT(A) dismissed the appeal based on the non-filing of Form no.67 before the due date of furnishing the return of income under section 139(1) of the Act.

The Tribunal considered the submissions and found that the assessee belatedly filed the return of income, claiming foreign tax credit of Rs. 14,86,291 under section 90/90A of the Act. The intimation issued under section 143(1) denied this credit based on the late filing of Form no.67. The Tribunal noted that Rule 128(9) required the form to be filed before the due date of the return of income under section 139(1) during the relevant year. However, Rule 128(9) was subsequently amended, extending the deadline to the end of the assessment year. The Tribunal referred to previous decisions where it was held that the filing of Form no.67 before completion of assessment, though not in accordance with Rule 128(9), still allows for the eligibility of foreign tax credit.

In line with the precedent set by the coordinate bench decisions, the Tribunal allowed the grounds raised by the assessee for statistical purposes. It directed the Assessing Officer to decide the claim of foreign tax credit on merits after accepting the Form no.67 and related documents. Grounds related to the levy of interest under section 234A were remanded for de novo adjudication, while those under sections 234B and 234C were allowed for statistical purposes. The appeal by the assessee was partly allowed for statistical purposes, with the order pronounced on 06/01/2023.

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