Delay in filing Form 67 Shall not be Considered as Ground for Denying Foreign Tax Credit claim: ITAT [Read Order]

The Income Tax Appellate Tribunal ( ITAT ), Pune Bench, has ruled that delay in filing Form 67 cannot be taken as a valid ground for denying a taxpayer’s Foreign Tax Credit ( FTC ) claim. It stated that the form 67 is not mandatory.

Initially, there was a delay of about 48 days in filing the appeal before the Tribunal, which the assessee explained through an affidavit. The affidavit detailed that a technical glitch during the initial filing caused the enclosures not to reflect on the ITAT’s system, and the assessee only became aware of the deficiency during a routine check in December 2024.

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The Tribunal, after considering the explanation, condoned the delay by relying on the Supreme Court’s ruling in Collector Land Acquisition v. MST Katiji, citing the presence of reasonable cause.

The main grievance of the assessee was that the lower authorities had denied the FTC solely due to the belated submission of Form 67, which is used to furnish details of foreign tax paid. The assessee’s counsel referred to the Mumbai Bench’s decision in Tom Thomas v. ADIT (CPC), Bangalore And argued that the filing of Form 67 is directory, not mandatory, and thus a delay should not result in denial of the FTC.

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The Tribunal noted that the intimation under Section 143(1), dated March 28, 2021, had denied the FTC claim of ₹8,60,645 solely on account of the delayed Form 67 filing. The period in question coincided with the COVID-19 pandemic, during which the Supreme Court had extended limitation periods (as held in Cognizance for Extension of Limitation In re.

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Although the assessee’s appeal before the CIT(A) was delayed by over two years, the Tribunal found merit in the explanation that the assessee only became aware of the notices after receiving a physical arrears notice in late October 2023.

Manish Borad and Astha Chandra observed that “since the issue of FTC has been consistently dealt by this Tribunal in plethora of decisions and a view has been taken that filing of Form No.67 is directory and not mandatory in nature and therefore delay in filing of such form should not be taken as a ground for denying the claim of FTC.”

The ITAT therefore remanded the matter back to the Jurisdictional Assessing Officer, directing them to examine the FTC claim afresh and allow the credit after verifying the necessary documents and providing an opportunity of hearing to the assessee.

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To Read the full text of the Order CLICK HERE

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