2023 (8) TMI 1535 - AT - Income Tax

Taxpayer gets second chance for foreign tax credit after incorrect Form 67 filing under section 90

The ITAT Mumbai remanded the case to the AO after the appellant was denied relief under section 90 due to incorrect filing of Form 67. The tribunal ... Denial of relief u/s 90 - Form 67 was not filed correctly - HELD THAT:- Form No. 67 has been filed by the Appellant before the processing the return of income under Section 143(1) of the Act. Therefore, respectfully following the decision of Sonakshi Sinha [2022 (10) TMI 107 - ITAT MUMBAI] we remand the issue raised in present appeal back to the file of AO with the direction to grant foreign tax credit to the Appellant as per the aforesaid decision after verification. Ground No. 1 raised by the Appellant is allowed for statistical purposes. Issues:1. Denial of relief under section 90 of the Income Tax Act.2. Confirmation of interest levy under sections 234B and 234C of the Act.Analysis:Issue 1: Denial of relief under section 90 of the Income Tax ActThe Appellant challenged the denial of relief under section 90 of the Act by the Ld. CIT(A) in the Assessment Year 2018-19. The Appellant claimed relief of INR 1,72,390 under section 90 in the revised return of income, which was denied by the CIT(A) citing non-filing of Form-67 within the due date of filing the return of income under section 139(1) of the Act. The Appellant contended that the Form-67 was furnished along with the revised return of income as prescribed under Rule 128 of the Income-tax Rules, 1962. The CIT(A) upheld the denial of relief, stating that the Appellant failed to comply with Rule 128 by not filing the return of income on time. However, the Appellant argued that the original Form 67 was filed before the processing of the revised return. The Tribunal referenced a prior case and held that the Appellant should be eligible for the foreign tax credit as Form No. 67 was filed before the completion of the assessment for the relevant year. Consequently, the issue was remanded back to the Assessing Officer to grant the foreign tax credit to the Appellant following the precedent.Issue 2: Confirmation of interest levy under sections 234B and 234C of the ActThe Appellant also contested the confirmation of interest levy under sections 234B and 234C of the Act. The Tribunal disposed of this issue as consequential, given the decision on the primary issue regarding the denial of relief under section 90. Ground No. 2 was consequently disposed of in this context.GeneralThe third ground raised by the Appellant was of a general nature and was disposed of accordingly. The Tribunal allowed the appeal for statistical purposes, indicating that the decision was made based on legal technicalities rather than substantive merits. The order was pronounced on 10.08.2023, with the Appellant's appeal being allowed for statistical purposes.This detailed analysis of the judgment highlights the key arguments, legal references, and the Tribunal's decision on each issue raised by the Appellant in the appeal.