Foreign tax credit cannot be denied for delayed Form 67 filing where the rule is procedural and no adverse consequence is prescribed.

Form 67 for foreign tax credit under Rule 128(9) was treated as procedural rather than mandatory, because the rule does not express any adverse consequence for delayed filing. The Tribunal followed coordinate bench rulings and held that foreign tax credit cannot be denied solely because Form 67 was filed after the return due date under section 139(1), especially where the form was later furnished with the revised return and before assessment was completed. On that basis, the assessee remained entitled to the foreign tax credit.

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Issues: Whether foreign tax credit could be denied solely because Form 67 was filed after the due date prescribed for furnishing the return of income under section 139(1) of the Income-tax Act, 1961.

Analysis: The claim for foreign tax credit arose from salary income taxable in Singapore and India. The dispute turned on whether Rule 128(9) of the Income-tax Rules, 1962, which requires Form 67 to be furnished by the due date for filing the return, is mandatory or directory. The Tribunal followed earlier coordinate bench decisions holding that the rule does not prescribe disallowance of foreign tax credit for delayed filing of Form 67 and that, in the absence of an express adverse consequence, the requirement is procedural in nature. The Tribunal also noted that the form had been filed along with the revised return and before completion of assessment.

Conclusion: Foreign tax credit could not be denied merely for belated filing of Form 67, and the assessee was entitled to the credit.

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