Tribunal grants relief under Section 90, upholds treaty benefits for foreign income

The Tribunal allowed the appeal of the assessee, emphasizing the incorrect denial of relief under Section 90, the prevention of double taxation on foreign income, and the importance of honoring treaty benefits as per the DTAA between India and Tanzania. The Tribunal held that the late filing of Form No.67 should not bar the assessee from treaty benefits and found the levy of interest under sections 234B/C/D unjustified.

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Issues:
The appeal involves the denial of relief under Section 90, consideration of late filing of Form 67 for treaty benefit, and the levy of interest under sections 234B/C/D of the Income Tax Act, 1961.

Relief under Section 90:
The assessee, an individual, filed the return for A.Y. 2020-21 as a resident but not ordinarily resident in India, declaring total income including earnings from India and Tanzania. The assessee claimed relief under Section 90 for TDS deducted in Tanzania as per the DTAA between India and Tanzania. Despite filing Form No.67 belatedly, the CPC did not grant the claimed relief, leading to a demand. The CIT(A) upheld this decision. However, the AR argued that the delay in filing Form No.67 was due to obtaining the required certificate from Tanzanian Revenue Authorities. The AR contended that the income from Tanzania had been taxed there, and the denial of relief under Section 90 was unjust. The Tribunal agreed, emphasizing that the assessee cannot be taxed twice on the same income, preventing double taxation.

Late Filing of Form 67 for Treaty Benefit:
The delay in filing Form No.67 was a crucial point of contention. The DR argued that since the assessee did not initially declare the Tanzanian salary, the late filing of Form No.67 should not be overlooked. However, the Tribunal noted that the salary from Tanzania was indeed disclosed in the return, and the late filing of Form No.67 should not bar the assessee from treaty benefits when there is a DTAA between India and Tanzania.

Levy of Interest under Sections 234B/C/D:
The CIT(A) had also confirmed the levy of interest under sections 234B/C/D of the Act, which was challenged by the assessee. The Tribunal, after considering all relevant material, found in favor of the assessee, stating that the denial of the claim and the levy of interest were not justified. Consequently, the appeal of the assessee was allowed, emphasizing the prevention of double taxation in cases involving income from foreign sources.

Conclusion:
The Tribunal allowed the appeal of the assessee, highlighting the incorrect denial of relief under Section 90, the importance of preventing double taxation on foreign income, and the significance of honoring treaty benefits as per the DTAA between India and Tanzania.

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