Treaty-based foreign tax credit cannot be denied for delayed Form 67 filing where the requirement is only procedural.

Foreign tax credit under section 90 could not be denied merely because Form 67 was filed after the due date under Rule 128(9). The text treats the filing requirement as procedural and directory, not a substantive condition that extinguishes the treaty-based credit. It notes that the India-Finland DTAA, particularly Article 22(2), obliges India to allow credit for foreign tax within the treaty limit, and that rule-making power under section 295 does not authorise adding a disqualification not found in the Act or treaty. Where the credit was otherwise available on record before assessment, a delayed Form 67 filing did not defeat relief.

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Issues: Whether foreign tax credit under section 90 could be denied merely because Form 67 was filed after the due date prescribed under Rule 128(9).

Analysis: The credit claimed related to tax paid in Finland and was supported by the India-Finland DTAA, particularly Article 22(2), which obliges India to allow credit for foreign tax subject to the treaty limit. Section 295(1) and section 295(2)(ha) empower the Board to frame procedural rules for granting relief, but the rule-making power does not authorise the creation of a substantive disqualification unless the Act or the treaty so provides. Rule 128 requires filing of Form 67 by the due date, but it does not expressly provide that delay extinguishes the claim to foreign tax credit. The filing requirement was therefore treated as procedural and directory, not mandatory. The credit was also available on the record before completion of the assessment, and the treaty benefit could not be defeated by a mere procedural lapse.

Conclusion: The denial of foreign tax credit for delayed filing of Form 67 was unsustainable, and the assessee was entitled to the relief under section 90.

Ratio Decidendi: A treaty-based foreign tax credit cannot be denied for breach of a procedural filing requirement unless the Act, the treaty, or the expressly makes timely compliance a condition precedent to the credit.

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