Late Filing of Form 67 Cannot Override Rights under DTAA: ITAT Allows FTC Claim

The ITAT ruled that the late filing of Form 67 cannot override rights under a Double Taxation Avoidance Agreement (DTAA). It allowed the Foreign Tax Credit (FTC) claim of the taxpayer, emphasizing that the right to FTC arises from the DTAA and not procedural compliance. The tribunal concluded that procedural lapses, such as delayed filing of Form 67, cannot deny substantive rights guaranteed under DTAA. This decision reinforces that compliance with procedural norms is essential but not at the expense of overriding rights granted under international treaties. The ruling also highlights the importance of distinguishing between mandatory procedural requirements and substantive entitlements. The taxpayer, in this case, was allowed FTC despite the delay, as the tribunal prioritized the DTAA’s provisions over procedural delays, ensuring justice. This sets an important precedent for taxpayers facing similar issues.