1995 (8) TMI 312 - AAR - Income Tax

Whether on the stated facts of the case, exemption under section 10(5B) of the Income-tax Act, 1961, would be available ? Whether on the stated facts, I would be considered as a technician for the purpose of section 10(5B) ?

Summary

Issues Involved:
1. Maintainability of the application under section 245Q(1) of the Income-tax Act, 1961.
2. Eligibility for exemption under section 10(5B) of the Income-tax Act, 1961.
3. Determination of the applicant as a "technician" for the purpose of section 10(5B).

Issue-wise Detailed Analysis:

1. Maintainability of the Application:
The first preliminary objection concerns whether the applicant qualifies as a "non-resident" under section 245Q(1) read with section 245N(b) of the Income-tax Act, 1961. The applicant was a non-resident in the financial years 1992-93 and 1993-94 but became a resident in the financial year 1994-95. The question is whether the residential status should be determined based on the financial year in which the application is made or the preceding financial year. The Authority concluded that for the purposes of section 245Q, the residential status should be determined with reference to the financial year immediately preceding the financial year in which the application is made. Since the applicant was a non-resident in the financial year 1993-94, the application is maintainable.

2. Eligibility for Exemption under Section 10(5B):
The second preliminary objection pertains to the proviso to section 245R(2), which restricts the Authority from allowing applications where the question is already pending before any income-tax authority, the Appellate Tribunal, or any court. The applicant filed a return of income for the assessment year 1995-96 after making the application under section 245Q, claiming exemption under section 10(5B). The Authority determined that the relevant date for considering whether the issue is "already pending" is the date of the application, not any future date. Since no return or claim was pending before the authorities when the application was filed, the application cannot be rejected under section 245R(2).

3. Determination as a "Technician":
The applicant's eligibility as a "technician" under section 10(5B) depends on whether his specialized knowledge and experience fall within the fields specified in the Explanation to section 10(5B). The applicant has extensive experience in software development and technical management, which aligns with the field of "Information technology including computer architecture systems, platforms and associated technology, software development process and tools" specified in Notification No. S.O. 569(E). Therefore, the applicant qualifies as a "technician" within the meaning of the Explanation to section 10(5B).

Ruling:
1. The applicant is entitled to exemption under section 10(5B) of the Income-tax Act, 1961.
2. The applicant is a technician within the meaning of the Explanation to section 10(5B) of the Act.