What the courts have decided on section 91, in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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Kern Enterprise Ltd v Deputy Commissioner of Income Tax
High CourtHelps taxpayerNo later treatment found
My client's New Zealand company filed Indian returns and paid tax believing its place of effective management was in India, and New Zealand has since taxed the same income. Can it get the Indian tax back?
Yes, on these facts. The Madras High Court quashed the order refusing rectification and refund, holding that CBDT Circular No. 8 of 2017 — under which section 6(3)(ii) does not apply to a company with turnover or gross receipts of Rs 50 crore or less in a financial year — is binding on the Department, so the company was not liable to Indian tax at all and the tax it had paid ought to have been refunded, with the Court adding that tax paid in excess must be refunded notwithstanding the procedure in section 155(14A) where the income was taxed in a foreign country.
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Brinda Ramakrishna v ITO
ITATHelps taxpayer
I filed Form 67 late and my foreign tax credit was disallowed. Does missing the deadline kill the claim?
No, on this decision. The Bangalore Tribunal held that Rule 128(9) does not provide for disallowance of foreign tax credit where Form 67 is filed late; filing Form 67 is directory, not mandatory; and the treaty overrides the Act, with the Rules unable to run contrary to the Act. The assessee had claimed credit of Rs 4,73,779 for Australian tax under section 90 read with Article 24 of the India-Australia treaty, filed Form 67 only on 18 April 2020, and had the credit refused. The Tribunal allowed the appeal, and also held the point could be taken in rectification proceedings under section 154.
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In re Cyril Eugene Pereira
Advance RulingHelps departmentSuperseded by amendment
I live and work in the UAE, where individuals pay no income tax. Can I claim the India-UAE treaty on my Indian dividends, interest and capital gains?
No, on the Authority's 1999 view. It ruled that the applicant, permanently resident in Abu Dhabi, could not be treated as a resident of the UAE under article 4 of the India-UAE agreement, because article 4(1) requires liability to tax in that State and the UAE imposes no income tax on individuals. It followed that he could not claim the reduced rates on dividends and interest under articles 10(2)(b) and 11(2)(b), and that the capital gains protection in article 13(3) was unavailable, so the gains remained taxable in India under domestic law. The reasoning has not survived; the ruling bound only the applicant.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.
