9911796707
TMI Blog2025 (2) TMI 33X X X X Extracts X X X X X X X X Extracts X X X X ..... 23 passed u/s. 154 of the Act by the Centralized Processing Centre, Bengaluru. [ for short AO ] 2. The assessee has marched this appeal on the following grounds:- "1. The learned CIT-A has erred in law disallowing the relief of Rs. 4,86,406/- claimed by the assessee u/s 90/90A toward DTAA. 2. That the appellant crave to add, amend, and alter the grounds before or at the time of appellate hearing." 3. The fact as culled out from the records is that in the case of the assessee is a salaried employee and has income under the head from salary only. During the year under consideration, assessee worked with Credit Suisse Business Analytics group at USA. He deputed to the Indian office of the company at Credit Suisse Business Analytics (India) Pvt. Ltd., and he joined at Indian office on 25.09.2021. As he resided in India for more than 182 days, therefore as per Income Tax act he become the tax resident and accordingly he filed the return declaring the global income (Income earned in India as well as Outside India) in the Indian ITR as per Income Tax Act 1961. He received a salary of Rs. 35,58,670/- from Indian Company and Rs. 42,89,595/- from Foreign company serving in that country ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in on this Income. 4.4 One of the requirements of Rule 128 for claiming FTC is provided by Rule 128(8) & (9) of the I.T. Rules and the same reads as under:- "(8) Credit of any foreign tax shall be allowed on furnishing the following documents by the assessee namely.- 1. a statement of income from the country or specified territory outside India offered for tax for the previous year and of foreign tax deducted or paid on such income in Form No.67 and verified in the manner specified therein: 2. certificate or statement specifying the nature of income and the amount of tax deducted therefrom or paid by the assessee- (a) from the tax authority of the country or the specified territory outside India: or (b) from the person responsible for deduction of such tax: or (c) signed by the assessee Provided that the statement furnished by the assessee in clause (c) shall be valid if it is accompanied by- (A) an acknowledgement of online payment or bank counter foil or challan for payment of tax where the payment has been made by the assessee (B) proof of deduction where the tax has been deducted. (9) The statement in Form No.67 referred to in clause (1) of sub-rule ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) 1 SCWR 57]) An election petition under the rules could only have been presented in the open court up to 16-5-1995 till 4.15 p.m. (working hours of the Court) in the manner prescribed by Rule 6 (supra) either to the Judge or the Bench as the case may be to save the period of limitation. That, however, was not done....." 4.7 The said principle has been followed in Cherukuri Mani v. Chief Secretary, Government of Andhra Pradesh & Ors. [(2015) 13 SCC 722] wherein the Hon'ble Apex Court held as under: "14. Where the law prescribes a thing to be done in a particular manner following a particular procedure, it shall be done in the same manner following the provisions of law without deviating from the prescribed procedure…………." 4.8 The Hon'ble Bombay High Court in the case of Commissioner of Income-tax v. Shivanand Electronics 209 ITR 63 has held that:- "When the Legislature casts a duty on the assessee claiming certain benefit, to comply with requirements which are associated with such benefit, the assessee cannot get the benefit without doing his part of the duty. He cannot be allowed to say that it was for the ITO to ask him to do so. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised a demand of Rs. 5,50,300/- vide intimation order u/s 143(1)(a) dated 26.10.2022 order no CPC/223/A2/278736439. The assessee filed an appeal before CIT(A). Later on he come to know about the Form 67 therefore he filed the form 67 on 26/07/2023 and refiled the form 67 again on 06/12/2023 and also filed request for correction u/s 154 on 07/12/2023. The CPC rejected this application also. 4. The CIT appeal has dismissed the case by considering that "Since the appellant has failed to file the Form 67, the AO, CPC has rightly disallowed the claim of Foreign Tax Credit. Hence, no interference is called for in the action of the AO in disallowing the claim of Foreign Tax Credit.". Submission:- 1. As already mention in the facts that during the year under consideration assessee received income in India as well as from outside India. He was in India from 25.09.2021. He received salary of Rs. 42,89,595/- by providing service outside India. He paid tax on this salary as per Income Tax Laws of USA Country. Copy of evidence of paying Tax at that country is enclosed at PB 11-13. 2. As he resided more than 182 days in India, thus as per section 6 of Income Tax act he is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the corresponding law in force in that country or specified territory, as the case maybe, without creating opportunities for non-taxation or reduced taxation through tax evasion or avoidance (including through treaty-shopping arrangements aimed at obtaining reliefs provided in the said agreement for the indirect benefit to residents of any other country or territory), or (c) for exchange of information for the prevention of evasion or avoidance of income- tax chargeable under this Act or under the corresponding law in force in that country or specified territory or investigation of cases of such evasion or avoidance, or (d) For recovery of income-tax under this Act and under the corresponding law in force in that country or specified territory, as the case maybe, and may, by notification in the Official Gazette, make such provisions as may be necessary for implementing the agreement. (2) Where the Central Government has entered into an agreement with the Government of any country outside India or specified territory outside India, as the case may be, under sub-section (1) for granting relief of tax, or as the case may be, avoidance of double taxation, then, in relation to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the said agreement, but defined in the Act, it shall have the same meaning as assigned to it in the Act and explanation, if any, given to it by the Central Government. 6. It is further submitted that the various judicial decisions are also there, where the Hon'ble Authorities have decided that that assessee is entitled for tax credit of federal as well as state taxes paid by him u/s 91 of the Act. Reliance is placed on following cases: - a. Aditya Khanna vs. ITO, ITA No. 6668/Del/2015 ITAT Delhi, order dated 17/05/2019. It was held that he is entitled for tax credit of federal as well as state taxes paid by him u/s 91 of the Act b. Wipro Ltd vs. Deputy Commissioner of Income Tax (2016) 3821TR179 (Karnataka High Court) where in the court has held that even in the absence of agreement u/s 90 of the act, the benefit conferred under section 91of the act is to be extended to the income tax paid in foreign jurisdiction. Further the Hon'ble ITAT Delhi Bench has also allowed the benefit of section 90/91in the below mentioned cases following the judgment passed by the bench itself. DCIT vs. Tata Sons Ltd (2011)135TTJ-1 (ii) Tata Sons Ltd vs. Deputy Commissioner of Inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /Ahd/2023 judgment dated 04/08/2023 held that it is pertinent to note that the late filing of Form No.67 cannot deny the entitlement of the assessee the benefit of treaty when the salary earned is from Tanzania and there is DTAA between India and Tanzania. it is undoubtedly clear that the salary is earned outside India and the assessee has paid tax on the said element on foreign country and, therefore, the assessee cannot be taxed twice on the same amount This will amount to double taxation. Hence, the CIT (A) as well as the Assessing Officer was not right in denying the claim of the assessee. Appeal of the assessee is thus allowed. Prayer: Considering the provisions of DTAA and Section 90, clause no 16, and judicial precedents supporting the position of assessee, the income received outside India on which tax also paid at origin Country the credit of said tax paid out side India should be allowed as per IT act as well as per DTAA. Thus, the relief rejected by the CPC and not allowed by CIT(A) is against the natural justice and it is therefore requested that kindly allow the credit of Foreign Tax paid by the assessee and oblige." 6. The ld. AR of the assessee filed on a detailed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by the respective parties. Under this ground of appeal, the assessee has filed Form 67 for claiming relief under section 90 of the IT Act. The said form was filed by the assessee on 28.12.2022 and the Income Tax Return was filed as on 08.09.2021 claiming relief under section 90/90A of the IT Act of Rs. 37,41,228/-. It is an undisputed fact that the assessee has got salary from his employer in Spain and due tax has been deducted by the employer. As per Article 15 of Double Taxation Avoidance Agreement (DTAA) with country Spain, the tax payable by assessee in that country is eligible for relief under section 90 of the Income Tax Act, 1961 to the assessee. The said relief was denied by the revenue authorities on the ground that the return for the year under consideration was filed by the assessee on 08.09.2021. However, the form 67 was filed on 28.12.2022 and not along with the return of income filed on 08.09.2021. Since according to revenue the said form 67 was filed after the due date of filing the return of income for the year under consideration, therefore, the assessee was rightly found not eligible for the credit of that amount. 6. We find that the case of assessee is full ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... :- "(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters :- ………………… (ha) the procedure for granting of relief or deduction, as the case may be, of any income-tax paid in any country or specified territory outside India, under section 90 or section 90A or section 91, against the income-tax payable under this Act;" Thus, in this way the Board has power to prescribe procedure for granting FTC. Therefore, in my view the procedure prescribed in Rule 128 should be interpreted in this context. Therefore, Rule 128 is a procedural provision and not a mandatory provision. The said rule 128(9) provides that Form 67 should be filed on or before the due date of filing the return of income as prescribed under section 139(1) of the Act. However, the said Rule nowhere provides that if the said Form 67 is not filed within the above stated time frame, the relief as sought by the assessee under section 90 of the Act would be denied. In case the intention of the Act or Rule was to deny the FTC, then in that eventuality either the Act or the Rules would h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time of framing the assessment order. While reaching to this conclusion, I further strengthen my view by relying upon the decision in the case of Brinda Rama Krishna vs. ITO 135 taxmann.com 358 wherein the Coordinate Bench of the Bangalore Tribunal had directed the Revenue to allow relief of FTC under section 90 of the Act, wherein Form 67 was filed after the prescribed due date. The ratio of the said decision in the case of Brinda Rama Krishna vs. ITO (supra) was further followed in another case decided by the Coordinate Bench of the Bangalore Tribunal in the case of 42 Hertz Software India Pvt. Ltd. vs. ACIT in IT Appeal No. 29 of 2021. On the contrary, I respectfully with all humility disagree with the view taken by the Visakhapatnam Bench of the Tribunal in the case of Muralikrishna Vaddi (supra) while relying upon the decision of Hon'ble Supreme Court and also of the decisions of Coordinate Benches of the Tribunal in the cases of Brinda Rama Krishna vs. ITO (supra) and 42 Hertz Software India Pvt. Ltd. vs. ACIT (supra). Therefore, considering the totality of facts and legal position as discussed above, I am of the view that assessee is entitled for the credit of FTC under sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
