Form No.67 is not mandatory but a directory requirement, Disallowance of FTC due to delay in filing the same not valid: ITAT [Read Order]

Form No.67 is not mandatory but a directory requirement, the Bangalore Bench of the Income Tax Appellate Tribunal (ITAT) has held that disallowance of FTC due to delay in filing the same is not valid.

Shri. Y. Sridhar, CA appeared for the assessee and Shri. K. Sankar Ganesh appeared for the revenue.

Shri. Shashidhar Seetharam Sharma, the assessee filed the return of income on 24-07-2017 admitting an income of Rs.69.22,004 which included income from other sources of Rs.6,96,084. The income from other sources included dividend income of Rs.4.77,500 received from a Denmark Company. On this dividend received from Denmark, TDS of Rs.1,28.925 was deducted @ 27%.

The appellant subsequently filed Form No. 67 on 08-02-2020 and made a rectification application on 29-05-2020 before the CPC Bangalore for giving credit to the Taxes deducted outside India. The CPC rejected the claim vide order dated 02-06-2020 stating that fresh claims of relief were being sought in the rectification application and which is not a mistake apparent from the records.

On appeal, the NFAC denied FTC available to the Assessee merely because there was a delay in filling Form 67 as it was filed after the due date for filing the original return of income prescribed under section 139(1) of the income tax Act.

Relying on the case of Brinda Rama Krishna, it was observed that Rule 128(9) of the Rules does not provide for disallowance of FTC in case of delay in filing Form No.67 and filing of Form No.67 is not mandatory but a directory requirement.

A Coram of Shri N V Vasudevan, vice president and Shri Chandra Poojari, Accountant Member observed that non-furnishing of Form No.67 before the due date u/s 139(1) of the Act is not fatal to the claim for FTC.

By following the case of Sanjay Patil Vs Assessing Officer Order dated 18/05/2022, the Tribunal held that the Assessee is entitled to FTC and the AO is directed to allow the claim.

To Read the full text of the Order CLICK HERE

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