Foreign Tax Credit cannot be denied solely for late Form 67 filing where treaty relief is otherwise admissible.

Foreign Tax Credit under section 90 and the applicable treaty was treated as a substantive relief that cannot be denied solely because Form No. 67 was filed after the Rule 128(9) due date; the filing timeline was regarded as procedural and directory, so belated submission did not extinguish an otherwise admissible credit. The income-computation issue also required verification because the computation sheet did not match the assessed figures and the capital gains amount appeared inconsistent with the revised return. The matter was restored for verification and corresponding relief, with the FTC claim accepted in principle and the appeal allowed partly.

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Issues: (i) Whether Foreign Tax Credit could be denied merely because Form No. 67 was filed after the due date prescribed under Rule 128(9); (ii) whether the income computation required verification where the computation sheet reflected a figure inconsistent with the assessed income.

Issue (i): Whether Foreign Tax Credit could be denied merely because Form No. 67 was filed after the due date prescribed under Rule 128(9).

Analysis: Section 90 of the Income-tax Act, 1961, read with the relevant treaty provision, confers relief for foreign taxes paid where the same income is also taxable in India. Rule 128(9) prescribes the timeline for filing Form No. 67, but the rule does not provide that delayed filing extinguishes the substantive entitlement to credit. The filing requirement was treated as procedural and directory, and the foreign tax credit could not be denied solely on the ground of belated filing when the credit was otherwise admissible in law.

Conclusion: The issue was decided in favour of the assessee, and the denial of Foreign Tax Credit was held unsustainable.

Issue (ii): Whether the income computation required verification where the computation sheet reflected a figure inconsistent with the assessed income.

Analysis: The assessed figures and the computation sheet did not tally, and the figure adopted for capital gains was said to be inconsistent with the revised return. The matter therefore required verification of the return and computation so that the correct taxable income and consequential relief could be worked out according to law.

Conclusion: The matter was restored for verification and corresponding relief, with this issue treated in favour of the assessee for statistical purposes.

Final Conclusion: The assessee succeeded on the substantive foreign tax credit claim, while the income-computation issue was directed to be verified, resulting in a partial allowance of the appeal.

Ratio Decidendi: Delay in filing Form No. 67 under Rule 128(9) does not, by itself, defeat the substantive right to Foreign Tax Credit where the underlying treaty-based relief is otherwise available.

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