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TMI Blog2014 (6) TMI 601X X X X Extracts X X X X X X X X Extracts X X X X ..... nal Inc." 3. Brief facts of the case are that assessee is a non-resident and his main source of income is salary received from Thailand as well as General Electrical International Inc. On verification of the return, AO noticed that the main source of income i.e. salary was not shown in the return filed by the assessee and assessee has claimed refund of TDS made from the salary made by the employer. On further verification of From No. 16 issued by the employer i.e. General Electronic International INC, the gross salary was shown at Rs. 18,82,764/- and after allowing the deduction under the Act, the net taxable salary worked out at Rs. 17,76,310/- and TDS on it of Rs. 5,41,806/- has been made by the employer accordingly. It was seen from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otes on DTAA exemption claimed in return submitted during the assessment proceeding and submissions in notes enclosed with the return, copy of which is enclosed herewith. I am not liable to tax on my income in India which is taxed in Thailand. The salary as mentioned by the AO paid in India amounting to Rs. 18,82,764/- is included in return of income submitted in Thailand and Tax has been paid as per Thai Tax Laws. Copy of the Income-Tax certificate proves this beyond doubt. Copies of these documents are enclosed. These documents include copies of income tax return, tax calculation of return filed in Thailand etc. From this it is clear that AO has erred both on facts and in law while coming to the conclusion that your appellant has been pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (iii) A show cause notice No. BRD/ITO (Intl.Taxn,)/2009-10 dated 24- 12.2009, issued to the assessee asking as to why claim of salary and allowances exempted under article 15(1) of Thailand-India DTAA amounting to Rs.18,82,764/- should not be disallowed and added to his total Income. After carefully considering the explanation given by assessee's wife, the same was not found to be acceptable. The assessing officer finalized the assessment on the basis of details/documents/ materials available on record. (iv) In view of the above, the assessee is a resident of Thailand. As per Income tax Payment Certificate issued by the Director Planning and Evaluation Division Thailand He had earned 43,83,410.11 Baht during the year 2006; also earned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the assessee, further it is noticed that name and address of the employer shown is General Electric International Inc., branch office, Block 4A, Mehrauli- Gurgaon Road, Gurgaon, Haryana-122002 i.e. Indian Permanent Establishment (PE) situated in Haryana (India) and on the second page place shown is New Delhi. Thus, tax on salary has also been deducted under section 192 of the I. T. Act, 1961 by the employer and the same has also been deposited in India. (e). On perusal of Schedule TDS-1 in Return format lTR-2 filed by assesses for AY 2007-08, it is noticed that name and address of the employer mentioned is' General Electric International Inc. situated at Mehrauli-Gurgaon Road, Gurgaon, Haryana-122002 i.e. during the period under refe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion and had spent only 37 days in India. b) The salary was paid to him by an enterprise situated in India and was paid in India and TDS was deducted on it. c) the assessee worked during the year in Thailand as plant manager in Rayong town and was working under the direct supervision and control of the Thailand company. The assessing officer has relied heavily on the fact that the salary was paid in India, by Indian concern. There is no doubt that under the Income tax act 1961, without considering the DTAA, the salary would have been taxable in India. However the provisions of double taxation avoidance agreement supersede the provisions of the Act unless specifically provided to the contrary. Therefore we need to go through the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oubt that he exercised his employment in Thailand. In the circumstances the conditions of article 15 (1) are squarely applicable and therefore the salary is taxable in Thailand. The decision of Authority of Advance Rulings in case of British Gas India (P) Ltd 2B7 ITR 162 is squarely on the similar facts and salary was held not taxable in India. The conditions of article 15(2) too would not be met because the basic condition of exercise of employment in India is not there. He has already paid tax in Thailand. The deduction of TDS in India would not be overriding the provisions of the treaty and is not a material fact. Therefore it is held that the salary income in question of the appellant is taxable in Thailand." 7. After hearing both the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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