No.
The FTC credit is eligible to be deducted only against the tax if any, payable as per the Indian IT Act on the said foreign income.
There is no option to claim the excess FTC available after adjustment of tax payable in India, against any Indian income. Nor can it be carried forward to subsequent years.
Most of the treaties generally follows ordinary credit method wherein relief of taxes paid in foreign country would be limited to tax payable on said income in India which would be eligible for relief of tax u/s 90 and the balance would become ineligible for relief of tax u/s 90. Therefore, balance amount of foreign taxes if not allowed as deduction (under any other provision of the Act) would become a cost for the entity, despite being a genuine & legitimate expense incurred wholly and exclusively for the purpose of business.
The said income here refers to the foreign income.
On perusal of relevant ITR schedule [‘Schedule FSI - Details of Income from outside India and tax relief (available only in case of resident)’], it is clear that ‘Tax relief available in India’ is lower of (a) Tax paid outside India; and (b) 'Tax payable on such income under normal provisions in India’. The amount eligible for relief u/s 90/91 is only that amount of which deduction is allowed u/s 90/91 and not the entire taxes paid outside India.
Meaning of eligible for relief u/s 90/91
If income earned outside India is Rs.100, taxes paid in foreign country on said income is Rs.20 (tax on gross basis) and ‘Tax payable on such income under normal provisions in India’ is Rs.3 (tax on net basis), then ‘Tax relief available in India’ will be lower of Rs.20 and Rs.3 i.e. Rs.3. Thus, as deduction/relief u/s section 90/91 is restricted to Rs.3 then only that Rs.3 could be treated as eligible for relief of tax u/s 90/91.