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Residential status determination - 'resident and ordinarily resident' vs. 'resident but not ordinarily resident' Detailed Analysis: 1. The appeal was filed against the order of the ld. CIT(A) for the assessment year 2001-02, focusing on the residential status of the assessee. The assessee claimed to be 'resident but not ordinarily resident,' but the Assessing Officer considered the assessee as 'resident and ordinarily resident' based on the days spent in India during the relevant assessment year. 2. The Assessing Officer noted that the assessee had been in India for more than 182 days during the assessment year, making him a resident as per section 6(1)(a) of the Act. Considering the assessee's presence in India in 5 out of the 10 previous years, the Assessing Officer treated the assessee as 'resident and ordinarily resident' under section 6(1) read with section 6(6) of the Act. 3. The ld. CIT(A) upheld the Assessing Officer's order, citing the amendment in the Act by the Finance Act, 2003, which clarified that a person would be 'not ordinarily resident' only if non-resident in at least 9 out of the 10 previous years preceding the relevant year. This amendment was deemed clarificatory in nature. 4. The assessee argued that based on various case laws, he should be considered 'resident but not ordinarily resident' since he was not resident in India for 9 out of the 10 years preceding the relevant year. The specific conditions for being 'not ordinarily resident' were discussed, emphasizing the importance of the number of years of residency. 5. The Tribunal analyzed the amendment brought by the Finance Act, 2003, which substituted the definition of 'not ordinarily resident' to include being non-resident in India in 9 out of the 10 previous years. The Tribunal considered the legislative intent and the impact of the amendment on the assessee's residential status. 6. The Tribunal rejected the ld. CIT(A)'s interpretation based on the Explanatory Note, emphasizing that the amendment had substantive implications on the assessee's tax liability and residential status. The Tribunal highlighted the principle of prospective application of statutes affecting vested rights and concluded that the assessee was rightly claiming the status of 'resident but not ordinarily resident' for the assessment year in question. 7. The Tribunal addressed the ld. CIT(A)'s concerns about potential anomalies in interpretation, emphasizing the strict interpretation of taxing statutes and the correction of casus omissus through legislative amendments. The Tribunal clarified that aid to Notes on clauses can only be sought in case of ambiguity in the section. 8. Ultimately, the Tribunal allowed the assessee's appeal, supporting the claim of 'resident but not ordinarily resident' status based on the specific conditions and the legislative amendments affecting residential status determination. This detailed analysis covers the issues related to the residential status determination in the judgment, providing a comprehensive understanding of the arguments presented and the Tribunal's decision based on legal principles and case laws.
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