2023 (3) TMI 719

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....rounds of appeal, the assessee has challenged the denial of Foreign Tax Credit (FTC) of Rs.1,52,602/- under Section 90 of the Act due to late filing of Form 67 prescribed for eligibility of such credit under Rule 128 of the Income Tax Rules, 1962. 3. The assessee an individual, an ordinary resident of India, worked with Bending Spoons in Milano, Italy for a brief period between 05.12.2018 till 31.03.2019 during the Assessment Year 2019-20. The assessee included the salary derived from services rendered in Italy in its return of income and simultaneously claimed FTC of Rs.1,52,602/- through Income Tax Return filed on 23.07.2019. However, the assessee did not furnish Form 67 before filing the return of income as required under Rule 128 of th....

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....that she is entitled to FTC and has vested right to make such claim under Section 90 of the Act read with Article 24 of India-Italy Tax Treaty. 7. As stated, section 90 of the Act provides that Government of India can enter into agreement with other countries for granting relief in respect of income on which taxes are paid in the country outside India and such income is also taxable in India. Article 24 of India-Italy DTAA provides for credit towards foreign taxes paid for earning income arising from foreign soil. Section 90(2) of the Act provides that provisions of this Act shall apply to the extent they are more beneficial to the assessee. Article 24(3)(a) seeks to provide for method of elimination of Double Tax and the amount of Italian....

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.... of the Act, the denial of FTC would be justified. In this regard, the assessee contends that Rule 128 provides machinery for seeking relief and compliance thereof are the procedural formality which has been duly complied with, albeit with some delay. The provisions of Sections 90, Section 91 and DTAA does not provide for denial of exemption merely on account of delay in filing of certain forms / reports in contrast to other provisions of the Act such as 80AC, 80IA(7), 10A(5) and 10B(5) where attendant conditions of compliance are mandatory. 9. In the factual backdrop, we notice that the Co-ordinate Bench of Tribunal in the case of Ms. Brinda Ramakrishna vs. ITO in ITA No.454/Bang/2021 order dated 17.11.2021 clearly held that filing of For....