Archana Gupta vs ACIT

PER MANISH AGARWAL, AM:

This appeal is filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals), Panaji [‘CIT(A)’ in short] in Appeal No. NFAC/2021-22/10426510 dated 13.03.2026 passed u/s 250 of the Income Tax Act, 1961 (the Act, in short) arising out of the rectification order dated 07.01.2025 passed u/s 154 of the Act for Assessment Year 2022-23.

Brief facts of the case are that assessee is an individual and filed her return of income on 31.08.2022 declaring total income of Rs.77,51,780/-. The assessee claimed that the total income earned from outside India Rs. 5,82,968/- which was included in the total income declared in India and the tax deducted outside India of Rs.1,84,695/-on such payments was claimed as relief u/s 90/90A/91 of the Act. Fr claiming the foreign tax credit, assessee filed Form No.67 along with return of income filed on 31.08.2021. While processing the return of income u/s 143(1) of the Act, the foreign tax credit was not allowed. Therefore, the assessee had filed a rectification application before the CPC, which was rejected vide its order dated 07.01.2025 wherein the APC has denied the claim of the assessee since Form No. 67 was not filed within the time limit prescribed under the statute.

Against the said order, assessee filed an appeal before the Ld. CIT(A) who dismissed the appeal of the assessee by holding that the Form No.67 was filed beyond the date of filing of return and, therefore, the assessee filed present appeal before the Tribunal. The solitary issue in the appeal of the assessee is with respect to the allowability of Foreign Tax Credit claimed vide Form 67 filed which as per the lower authorities was delayed i.e. filed after the due date of filing of return of income as provided u/s 139(1) of the Act.

Heard the parties and perused the materials available on record. In the present case, undisputed assessee had filed Form No. 67 electronically on 31.08.2022 which was delayed as per Rule 128(9) of the Income Tax Rules, 1962 (the Rules) according to the same should be filed on or before the due date of filing of return of income as provided u/s 139(1) of the Act. The CBDT vide Notification No.100/22 dt. dated 18.08.22 has amended the Rule 128(9) of the Rule and substituted the Sub-Rule 9 to Ruel 128 and has extended the period of filing of the Form 67 from the due date of filing of return u/s 139(1) to on or before the end of the assessment year relevant to the previous year in which such income was offered for tax. The amendment have come into force from the 1^st April, 2022 and relevant to Ay 2022-23 and onwards. It appears that this amendment has not been considered by the lower authorities while denying the claim of the assessee as the year under appeal is Assessment Year 2022-23 and as per the aforesaid notification, the CBDT has already extended the period of filing of Form 67 up to 31.03.2023, therefore, the Form 67 filed by the assessee on 31.08.2022 is well with the time limit provided and thus the assessee is qualified claiming for the Foreign Tax Credit as per law. We thus direct the AO to allow the foreign tax credit as claimed by the assessee after verifying the other conditions are fulfilled by the assessee. All the grounds of the appeal of the assessee are allowed with the aforesaid directions.

In the result, the appeal of the assessee is allowed.