Foreign tax credit survives delayed Form 67 filing when submitted before return processing, subject to verification under applicable law.

Foreign tax credit remains available where Form 67 is filed after the income-tax return but before processing under section 143(1). The note states that Form 67 is a directory procedural requirement, not a mandatory condition that defeats the substantive entitlement to credit. It further states that applicable tax treaty provisions prevail where more beneficial than general statutory and procedural rules. Accordingly, credit should not be denied solely because Form 67 was filed late; the claim must be verified and allowed in accordance with law.

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Issues: Whether foreign tax credit can be denied solely because Form 67 was filed after the return of income but before processing of the return.

Analysis: Filing Form 67 is a directory procedural requirement and not a mandatory condition that extinguishes the substantive right to claim foreign tax credit. Since Form 67 was filed before the return was processed under Section 143(1) of the Income-tax Act, 1961, denial of credit solely on the ground of delayed filing was unsustainable. The tax treaty provisions governing foreign tax credit prevail to the extent they are more beneficial than the general statutory and procedural provisions.

Conclusion: Foreign tax credit cannot be denied solely for delayed filing of Form 67. The Assessing Officer was directed to verify the claim and grant the credit in accordance with law.

Ratio Decidendi: Form 67 is directory and not mandatory, and delayed filing before processing of the return does not defeat the substantive claim for foreign tax credit.

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