Foreign tax credit cannot be denied merely for delayed Form 67 filing when treaty relief remains substantively available.

Rule 128(9) of the Income-tax Rules prescribes the time for filing Form No. 67, but it does not create a separate disallowance for late filing. The Tribunal treated the requirement as procedural and directory, and held that the substantive entitlement to foreign tax credit under the applicable DTAA and section 90 of the Income-tax Act cannot be curtailed by the Rules. Late filing of Form No. 67 was therefore not fatal to the claim, and the credit could be examined and granted in rectification proceedings.

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Issues: Whether foreign tax credit could be denied merely because Form No. 67 was filed after the due date under section 139(1) of the Income-tax Act, 1961, and whether such claim could be rejected in rectification proceedings under section 154 of the Act.

Analysis: The Tribunal held that Rule 128(9) of the Income-tax Rules, 1962, prescribes the time for furnishing Form No. 67 but does not create a disallowance provision for late filing. The requirement was treated as procedural and directory, not mandatory. It further held that the treaty entitlement to foreign tax credit under the relevant DTAA prevails over the Rules, and that the Rules cannot curtail the substantive relief available under section 90 of the Act. On that basis, the Tribunal found that late filing of Form No. 67 was not fatal to the claim for foreign tax credit and that the claim could be examined and granted in rectification proceedings.

Conclusion: The denial of foreign tax credit was unsustainable, and the assessee was entitled to the credit.

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