TIPS MUSIC LTD,MUMBAI V. ASST. DIRECTOR OF INCOME TAX, CPC, BENGALURU, BANGALORE

ITA 655/MUM/2025

AI Insights

The case involves Tips Music Ltd., which appealed against the order of the CIT(A) confirming the denial of a foreign tax credit (FTC) of Rs. 47,36,704. The FTC was claimed on income received from the UK and Thailand, which was taxed in India. The original return filed by the assessee did not include Form 67, necessary for claiming FTC. Although a revised return with Form 67 was later submitted, the credit was denied by the Central Processing Centre (CPC) and upheld by the CIT(A) on procedural grounds. The Tribunal, however, held that the substantive right to FTC cannot be denied due to non-compliance with procedural requirements.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 398330 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2019-2020
• Laws Referred To: Income Tax Act, 1961, Income Tax Rules, 1962, DTAA
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HEMANSHU JOSHI; DR
• Assessee Lawyers: DEEPAK TRALSHAWALA; AR
• Keywords: Revised return; Double taxation relief
• Section: 90

Judgement Text

" | आयकर अपीलीय अधिकरण न्यायपीठ, म ुंबई | IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, HON’BLE VICE PRESIDENT & SHRI NARENDRA KUMAR BILLAIYA, HON’BLE ACCOUNTANT MEMBER I.T.A. No. 655/Mum/2025 Assessment Year: 2019-20 Tips Music Ltd. 601, Durga Chambers 6th Floor, Linking Road Khar West Maharashtra - 400054 [PAN: AAACT5284A] Vs Asst. Director of Income Tax, CPC, Bengaluru अपीलार्थी/ (Appellant) प्रत् यर्थी/ (Respondent) Assessee by : Shri Deepak Tralshawala, A/R Revenue by : Shri Hemanshu Joshi, Sr. D/R सुनवाई की तारीख/Date of Hearing : 02/06/2025 घोषणा की तारीख /Date of Pronouncement: 04/06/2025 आदेश/O R D E R PER NARENDRA KUMAR BILLAIYA, AM: This appeal by the assessee is preferred against the order of the ld. CIT (A)/Addl./JCIT(A), Faridabad [hereinafter “the ld. CIT(A)”], dated 21/12/2024, pertaining to AY 2019-20. 2. The sum and substance of the grievance of the assessee is that the ld. CIT(A) erred in confirming the denial of foreign tax credit (FTC) of Rs. 47,36,704/- on the ground that Form No. 67 was not filed along with return of income. As per Rule 128(9) of the Income Tax Rules, 1962 (hereinafter “the Rules”). 3. Briefly stated the facts of the case are that the assessee filed its original return of income on 13/09/2019, however, the assessee did not file Form 67 for claim of FTC on income received from U.K. & Thailand which was offered for tax in India. Subsequently, the assessee filed a revised return of income along with Form 67 in support of this claim of I.T.A. No. 655/Mum/2025 Tips Music Ltd. 2 FTC. The credit for FTC was denied while processing the return by the CPC. The assessee preferred appeal before the ld. CIT(A) but without any success. The only reason given by the ld. CIT(A) is that the assessee is not entitled for credit of FTC u/s 90 of the Act as Form 67 was not furnished by the assessee while filing the ITR u/s 139(1) of the Act. 4. We have carefully considered the orders of the authorities below. We are of the considered view that neither Section 90 of the Act nor the DTAA provides that FTC shall be disallowed for non-compliance with any procedural requirements. We are of the considered view that FTC is assessee’s vested right as per articles 24(1)(a) and 23 of the DTAA r.w.s. 90 of the Act. The same cannot be disallowed for non-compliance with the rules procedural requirements. 4.1. In fact the assessee has subsequently filed Form 67 with the revised return of income which cannot be rubbished. Therefore, in the interest of justice and fairplay, we direct the AO to verify Form 67 and allow the FTC to the assessee. 5. In the result, appeal of the assessee is allowed as per above directions. Order pronounced in the Court on 4th June, 2025 at Mumbai. Sd/- Sd/- (SAKTIJIT DEY) (NARENDRA KUMAR BILLAIYA) VICE PRESIDENT ACCOUNTANT MEMBER Mumbai, Dated 04/06/2025 *SC SrPs I.T.A. No. 655/Mum/2025 Tips Music Ltd. 3 आदेश की प्रतततिति अग्रेतषत /Copy of the Order forwarded to : 1. अिीिार्थी / The Appellant 2. प्रत्यर्थी / The Respondent 3. संबंतित आयकर आयुक्त / Concerned Pr. CIT 4. आयकर आयुक्त ( अिीि ) / The CIT(A)- 5. तवभागीय प्रतततनति ,आयकर अपीलीय अधिकरण, म ुंबई /DR,ITAT, Mumbai, 6. गार्ड फाई/ Guard file. आदेशानुसार/ BY ORDER TRUE COPY Assistant Registrar आयकर अिीिीय अतिकरण ITAT, Mumbai "