TaxTMI 
TaxTMI 
2023 (8) TMI 1535
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....the appeal of the Assessee against the Rectification Order, dated 07/01/2021, passed by Assistant Director of Income Tax, CPC under Section 154 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act'). 2. The Appellant has raised the following grounds of appeal: "1. Re.: Relief u/s 90 of the Act denied: 1.1 The learned CIT(A) has erred in confirming the Order of Centralized Processing Center ("CPC"), Bengaluru by denying the relief claimed under section 90 of the Act of INR 1,72,390, in the revised return of income. 1.2 The learned CIT(A) has erred in denying the relief on the ground that the Appellant has not filed Form-67 within the due date of filing of return of income prescribed under section 139....
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.... the appeal." 3. The relevant facts, in brief, are that the Appellant is an individual resident. During the previous year relevant to the Assessment Year 2018-19, the Appellant was deputed to Netherland till 11/11/2017. The Appellant stayed in India for 140 days. During four year preceding the relevant previous year 2017-18, the Appellant's stay in India was more than 365 days. Further, during 7 years preceding the relevant previous year 2017-18, stay of the Appellant in India exceed 729 days. The Appellant qualified as a resident and ordinarily resident in India as per the provision of Section 6(1) of the Act. 4. The Appellant filed return of income for the Assessment Year 2018- 19 on 28/08/2018, which was revised on 29/03/2019. In t....
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....aiming foreign tax credit of INR 1,72,390/- as claimed in the original Form 67. The Appellant filed third rectification application requesting for grant of credit for tax paid in Netherland as per Form 67 filed by the Appellant. Vide rectification order, dated 07/01/2021, passed under Section 154 of the Act, the rectification application was rejected giving the following reason: "As seen from the e-filed return of income and rectification filed by you the Relief u/s. 90/90A has not been allowed in your case and as the online Form 67 has not been filled / incorrectly filled by you. The furnishing of Online Form 67 is required as per sec.90/90A of the Income Tax Act 1961 read with Rule 21AA of the Income Tax Rules 1962 Please ensure ....
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....e Appellant before the processing of the revised return of income. The claim of foreign tax credit was denied to the Appellant on the ground that Form 67 was not filed correctly. In appeal the CIT(A) dismissed the appeal of the Appellant on this issue and confirmed the denial of foreign tax credit claimed by the Appellant on the ground that the Appellant had failed to comply with Rule 128 of the Income Tax Rules, 1962 by not filing the return of income on or before the due date of filing return of income under Section 139(1) of the Act. 11. We have considered the rival submissions and perused the material on record on this issue. We note that while dismissing the appeal of the Appellant herein the CIT(A) has recorded as under: "....
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....of filing the return of income for relevant assessment year. Therefore, the denial of foreign tax credit of Rs.1,72,390/- by the AO, CPC in the order u/s.154 is justified." (Emphasis Supplied) 12. We note that the CIT(A) has chosen not to follow the decision of the Mumbai Bench of the Tribunal in the case of Sonkashi Sinha Vs. Commissioner of Income Tax (Appeals): [2022] 142 taxmann.com 414 (Mumbai - Trib.) wherein it was held as under: "12. We have carefully considered the rival contention and perused the orders of the lower authorities. Short question in this appeal is whether assessee is entitled to foreign tax credit even when form number 67 required to be filed according to the provisions of rule 128 (9) of the Income Tax R....
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....ell settled that while laying down a particular procedure, if no negative or adverse consequences are contemplated for non-adherence to such procedure, the relevant provision is normally not taken to be mandatory and is considered to be purely directory. Admittedly, Rule 128 does not prescribe denial of credit of FTC. Further the Act i.e. section 90 or 91 also do not prescribe timeline for filing of such declaration on or before due date of filing of ROI. Further rule 128 (4) clearly provides the condition where the foreign tax credit would not be allowed. Rule 128 (9) does not say that if prescribed form would not be filed on or before the due date of filing of the return no such credit would be allowed. Further by the amendment to the rul....