Foreign tax credit claim: belated Form 67 filing not a complete bar, with remand for residential status verification.

Belated filing of Form No. 67 was treated as insufficient, by itself, to completely bar a foreign tax credit claim for U.S. tax paid on ESOP-related income. The Tribunal also noted the assessee's alternative contention that the ESOP perquisite may not be taxable in India in view of residential status, and that additional evidence had been filed before the first appellate authority. As the residential status and corresponding taxability issues required factual verification, the matter was remitted to the Assessing Officer for fresh examination of the foreign tax credit claim and the alternative plea after considering the additional material.

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Issues: Whether denial of foreign tax credit on account of belated filing of Form No. 67 was justified, and whether the assessee's alternative claim based on residential status and additional evidence required fresh adjudication.

Analysis: The assessee had claimed foreign tax credit for taxes paid in the United States in respect of ESOP-related income. The Tribunal noted that Form No. 67 had been filed belatedly, but relied on the view that the delay in filing the form could not by itself be treated as a complete bar to the claim. It also noticed that the assessee had raised an alternative case that the ESOP perquisite may not be taxable in India having regard to the assessee's residential status in the relevant years, and that additional evidence had been produced before the first appellate authority. Since the factual aspects bearing on the residential status claim and the corresponding taxability of the perquisite required verification, the matter called for reconsideration by the Assessing Officer.

Conclusion: The order denying the claim was set aside and the Assessing Officer was directed to re-examine the claim for foreign tax credit and the alternative plea after verification of the additional material.

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