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TMI Blog2006 (5) TMI 79X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee left India in 1968 and was employed in Muscat and Dubai till the year 1992-93 and returned to India thereafter. A search was carried out under section 132 in the premises of the assessee at Bhopal for a period of 13 days from October 18, 1996, to October 30, 1996. On the basis of the said search, an assessment was made under section 158BC read with section 143(3) of the Act for the assessment years 1992-93 to 1997-98. In the said assessment, the Assessing Officer found that the assessee was a person not ordinarily resident in India and had made several deposits in foreign currency in his NRE accounts in different banks in India. The Assessing Officer excluded from the said deposits remittances of foreign currency directly rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gn currency brought by the assessee covered by declarations made under the Foreign Exchange Regulations Act and also by the foreign exchange vouchers showing conversion of foreign exchange represented income which had been earned by the assessee outside India and accordingly deleted the said addition of Rs. 1,03,50,020 in its order dated June 7, 2000. By the said order, the Tribunal also deleted the addition of interest of Rs. 1,45,000 on such unexplained deposits in the NRE accounts of the assessee from the income of the assessee. The Department filed M.A.I.T. No. 114 of 2000 under section 260A of the Act before this court and in the judgment dated January 25, 2006, (CIT v. Purshottam Khatri [2007] 290 ITR 260), we held that under the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat deleting of the addition of interest on foreign currency deposits which were not covered by declarations under the notifications issued under the Foreign Exchange Regulation Act but were covered by exchange vouchers issued by the foreign exchange centres outside the country was not correct in law as under section 10(4)(ii) of the Act, only income by way of interest standing to the credit of a person in an NRE account of the bank in accordance with the Foreign Exchange Rules and Regulations are only exempt from tax. Mr. A. P. Shrivastava, learned counsel for the assessee submitted that our judgment of the High Court raises substantial questions of law of general importance relating to taxability of income of a person who is not ordinar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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