Condonation of Delay: revisional power permits excusing technical non compliance so foreign tax credit may be allowed after verification.

The piece clarifies that revisional power under Section 264 read with Section 119 authorises the Principal Commissioner to condone a venial or technical delay in uploading Form No. 67 and to remedy defaults where denial would unjustifiably withhold an assessee's substantive right to foreign tax credit; consequence: denial of credit solely for such technical non-compliance is not justified. It further prescribes that where Form No. 67 is subsequently furnished the Assessing Officer must verify the record and allow foreign tax credit if supported, or else pass a speaking order explaining denial, with the assessee preserved for further remedies.

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Issues: (i) Whether the Principal Commissioner has power to condone delay in uploading Form No. 67 and exercise discretion under Section 264 read with Section 119 of the Income-tax Act, 1961 in cases of default by the assessee; (ii) Whether the Assessing Officer must allow foreign tax credit after subsequent filing of Form No. 67 and verification in exercise of writ jurisdiction.

Issue (i): Whether the Principal Commissioner can condone the delay in uploading Form No. 67 and exercise power under Section 264 of the Income-tax Act, 1961, including invoking powers under Section 119, where the assessee defaulted in filing within the due date.

Analysis: The Court examined the interplay between Rule 128 of the Income Tax Rules, 1962 (requiring Form No. 67 by the due date under Section 139) and the discretionary powers available to the Commissioner under Section 264 and Section 119 of the Income-tax Act, 1961. The Court considered precedent recognising the Commissioner's power to deal with defaults by assessees and weighed the consequence of a technical delay against the assessee's substantive right to foreign tax credit, noting that denial of credit solely for a venial or technical breach would result in withholding of a substantial amount without lawful authority.

Conclusion: The Commissioner has power to consider and, where appropriate, condone delay in filing Form No. 67 when exercising revisional jurisdiction under Section 264 and may invoke the powers available under Section 119; denial of foreign tax credit solely on account of such technical delay is not justified in the circumstances.

Issue (ii): Whether, having subsequently furnished Form No. 67, the Assessing Officer is required to allow foreign tax credit after verification, and what relief the writ court may grant.

Analysis: The Court noted that the petitioner furnished Form No. 67 after the due date and sought rectification under Section 154 and revision under Section 264; the AO had denied credit because Form No. 67 was not uploaded in time. Exercising writ jurisdiction, the Court directed the AO to verify the facts and allow the foreign tax credit if supported by the record, or else to pass a speaking order denying the credit, preserving the assessee's right to further remedies.

Conclusion: The AO is directed to verify the subsequently filed Form No. 67 and, if the facts warrant, to allow the foreign tax credit; if the credit is not allowed, a speaking order must be passed, preserving the assessee's rights.

Final Conclusion: The writ petitions are allowed on merits: the Commissioner's rejection of the revision application on the ground of inability to condone delay is not sustained, and the AO is directed to consider and decide allowance of foreign tax credit after verification within two months; related petitions are allowed for the same reasons.

Ratio Decidendi: A technical or venial failure to file Form No. 67 by the due date cannot, by itself, justify denial of an assessee's substantive right to foreign tax credit; revisional powers under Section 264 read with Section 119 permit condonation of such default and the AO must verify and allow credit where warranted or record reasons in a speaking order.

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