YURAAZ ARORA,MUMBAI V. WARD 34(1)(1), MUMBAI

ITA 4904/MUM/2024

AI Insights

The case involves Yuraaz Arora, the appellant, who contested the denial of a foreign tax credit by the Assessing Officer (AO) and the Commissioner of Income Tax (Appeals). The credit of Rs 48,241 was initially denied because Form 67, required for claiming the foreign tax credit under section 90 of the Income Tax Act, was filed late, beyond the due date for filing the income tax return. The appellant argued that the delay was procedural and should not affect the substantive right to the credit. The Tribunal, referencing a similar case by the Madras High Court, ruled in favor of the appellant, emphasizing that procedural lapses should not override substantive tax rights when the necessary information was available to the tax authorities.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 705951 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2019-2020
• Other Referred Cases: Duraiswamy Kumaraswamy V. PCIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MAHESH DATTATRAYA LONDHE
• Assessee Lawyers: RAVIKANT PATHAK
• Keywords: Question of law; Salary income; Procedural lapse
• Section: 154; 139

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, ‘SMC’ BENCH MUMBAI BEFORE: SHRI PAWAN SINGH, JUDICIAL MEMBER ITA No. 4904/MUM/2024(AY: 2019–20) (Physical hearing) Yuraaz Arora 61, Amore Road No 12, JVPD Scheme, Juhu, Mumbai-400049. Vs. Ward 34(1)(1) Kautilya Bhavan, G Block BKC, Bandra East, Mumbai-400051. PAN: BSKPA1691L (Appellant) .. (Respondent) Assessee by Shri. Ravikant Pathak, CA Revenue by Shri. Mahesh Dattatraya Londhe, Sr. DR Date of Hearing 03/07/2025 Date of Pronouncement 04/07/2025 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by the assessee is directed against the order of Learned Commissioner of Income Tax (Ld. CIT(A)) dated 26.07.2024 for A.Y. 2019-20. The assessee has raised the following grounds of appeal: “ 1. The Hon'ble Addl./JCIT(A)-1 Jaipur erred in confirming the action of AO in not allowing Foreign Tax credit of Rs 48,241/- u/s 90 of the Income Tax Act, 1961 (the Act) by holding that Form 67 has not been filed on or before the due date of filing the return of income u/s 139 of the Act. The Appellant submits that delay in filing Form 67 is procedural in nature and cannot be a reason to deny the Foreign Tax Credit to the Appellant, hence, the Appellant submits that he shall be allowed the FTC as claimed in return of income filed u/s 139 of the Act. The Appellant craves leave to add, to alter or to amend the aforesaid ground of appeal.” 2. Rival submissions of both the parties have been heard and record perused. The Ld. AR of the assessee submits that very short question of law is involve in the present appeal. The assessee is an individual and earned salary income during ITA no. 1244/MUM/2025 Shree 1008, Shantinath Digamber Jain Trust 2 the relevant financial year i.e. 2017-18. The time period for filing return of income under section 139(1) for AY 2018-19 was up to 31.06.2019. The assessee filed his return on 31.08.2019 declaring income of Rs. 7,05,400/-. In the return of income, the assessee claimed credit of foreign tax of Rs. 48,241/-. The return was processed by Central Processing Center (CPC) on 26.05.2021 and such foreign tax credit was not allowed. The assessee filed application under section 154 for rectification but the application was also rejected. The application was not allowed credit of foreign tax for the reasons that Form 67 was filed/ uploaded beyond 26 days of prescribed period. The form 67 was filed/ uploaded on 26.09.2029. The Ld. AR of the assessee submits that furnishing/uploading Form 67 is a procedural lapse and could be regularized/ condoned as Form 67 was available at the time of processing of return of income as well as during the first appellate stage. The Ld. CIT(A) in para 5.1.2 of the order recorded all such fact and not accepted the appeal by taking view that Form 67 was not made with income tax return. The Ld. AR of the assessee submits that Hon’ble Madras High court in Duraiswamy Kumaraswamy V. PCIT in W.P.No. 5834 of 2022 dated 06.10.2023 on similar set of Act, wherein there was delay of 204 days in furnishing Form 67 allowed relief to the assessee. The Ld. AR submits that his case is squarely covered by the decision of Hon’ble Madras High Court in Duraiswamy Kumaraswamy V. PCIT (supra). 3. On the other hand, the Ld. DR for the revenue supported the order of lower authorities. 4. I have considered the submission of both the parties and perused orders of lower authorities carefully. On considering the fact I find that there no dispute ITA no. 1244/MUM/2025 Shree 1008, Shantinath Digamber Jain Trust 3 on the fact that there was a delay of 26 days in filing Form 67. I find that Hon’ble Madras High Court in Duraiswamy Kumaraswamy V. PCIT (Supra) held that furnishing Form 67 is a directory in nature. I further find that all particulars/ details in Form 67 Details for Foreign tax credit were available at the time of processing return of income as well as during the first appellate stage. Thus, the jurisdictional AO is directed to allow credit of foreign tax to the assessee. In the result, grounds of appeal raised by assessee are allowed. 5. In the result, appeal of the assessee is allowed. Order pronounced in open court on 04.07.2025. Sd/- (PAWAN SINGH) JUDICIAL MEMBER Mumbai; Dated 04/07/2025 Anandi Nambi, Steno Copy of the Order forwarded to: BY ORDER, (Asstt. Registrar) ITAT, Mumbai 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. "