Can I revise my claim to get DTAA benefit?

I have filed the tax return for assessment year (AY) 2023-24 before the due date. Recently, I came to know that I could have claimed refund for the capital gain tax on mutual funds as per the DTAA (double taxation avoidance agreement) with UAE. Can I still claim the refund or is the due date for this over?

—Name withheld on request

I assume that you are eligible to claim the benefits under the India-UAE DTAA as a non-resident Indian (NRI). Further, you are correct in your understanding that a resident of UAE can claim exemption from capital gains on sale of mutual funds under Article 13(5) of India-UAE DTAA.

Though you have filed your tax return before the due date, the date for filing a revised return for AY 2023-24 expired on 31 December 2023. Further, the provisions for filing an updated return do not apply to your case since an updated return cannot be filed in a case which results in reduction in tax liability.

These are, however, a few options:

(a) If you have already received the intimation under Section 143(1), you have the option of filing a revision petition under Section 264 with the specified income tax authority. Under Section 264, the specified income-tax authority has the power to entertain even fresh claims that could not be made by any assessee during the time of return filing.

(b) If you would be subject to scrutiny assessment under Section 143(3), then it may be challenging to make such a claim during the course of assessment proceedings in light of the Supreme Court decision in the case of Goetze (India) Ltd.

Under such circumstances, you may prefer to either file an appeal against the assessment order under Section 246 or make a revision petition under Section 264 as explained above. The appellate authorities are not constrained by the aforesaid Supreme Court order, to entertain any fresh claim that an assessee wishes to make before them.

(c)Make an application under Section 119(2)(b) to the Central Board of Direct Taxes (CBDT), requesting for acceptance of a revised return and condonation of delay in filing it.

Harshal Bhuta is partner at P.R. Bhuta & Co. Chartered Accountants.

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Published: 12 Feb 2024, 09:38 PM IST

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