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TMI Blog2021 (6) TMI 706X X X X Extracts X X X X X X X X Extracts X X X X ..... tayed outside India for more than 182 days and had received salary from a foreign employer outside India for services rendered outside India, therefore, respectfully following the decision of VDESH KUMAR VERSUS DCIT, CIRCLE-1, GHAZIABAD [ 2018 (8) TMI 58 - ITAT DELHI] set aside the order of the CIT(A) and direct the AO to delete the addition. Addition on account of stamp duty - The same also is liable to be deleted under the facts and circumstances of the case. Admittedly, the AO has not made any addition on account of purchase of immovable property meaning thereby he has accepted the source of that huge amount. Amount towards the stamp duty is concerned, a perusal of the assessment order shows that the amount was paid by Mrs. Vandana Bhardwaj as per the ledger account of M/s Landcraft Developers Pvt. Ltd. which was reproduced by the AO in the body of the assessment order. Therefore, when the money was paid by Mrs. Vandana Bhardwaj, there was no reason for making the addition in the hands of the assessee. CIT(A) had not given any cogent reason as to why 50% shall be added in the hands of the assessee when the payment was admittedly made by Mrs. Vandana Bhardwaj, a fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 6 of the IT Act and held that the assessee was resident in India and salary income earned by him was taxable in India. He also referred to the definition of non-resident u/s 2(30) of the IT Act and noted that the assessee had spent more than 60 days in India and fulfilled the conditions envisaged under Clause (c) of section 6(1) of the IT Act, 1961. He rejected the explanation of the assessee that his income was not taxable in India by virtue of clause (a) of section 6(1). Rejecting the various explanations, the AO made addition of ₹ 19,25,067/- under the head Income from salary. 2.1 Further, the AO noted that an amount of ₹ 3,50,000/- has been spent towards the stamp duty for purchase of the property. On being questioned by the AO, it was explained that an amount of ₹ 3,66,700/- was debited by M/s Landcraft Developers Pvt. Ltd., against purchase of stamp papers. However, in absence of any satisfactory explanation given by the assessee, the AO made addition of ₹ 3,50,000/- as unexplained investment u/s 69A of the IT Act. The AO accordingly determined the total income of the assessee at ₹ 22,77,980/-. 3. Before the CIT(A), the assessee, apart ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India or not for bringing the salary income earned from a foreign entity during the year under consideration. To be a resident in India either of the conditions given below are to be satisfied : 6. For the purposes of this Act, - (1)An individual is said to be resident in India in any previous year, if he- (a) is in India in that year for a period or periods amounting in all to one hundred and eighty-two days or more; or (b) . (c) having within the four years preceding that year been in India for a period or periods amounting in all to three hundred and sixty-five days or more, is in India for a period or periods amounting in all to sixty days or more in that year. 10.3 The Appellant had to satisfy with the facts that if by virtue of clause (a) of section 6(1) of the IT Act he was not resident in India, whether he had been in India within the four years preceding that year for a period or periods amounting in all to three hundred and sixty five days or more and was in India for a period or periods amounting in all to sixty days or more in the year under consideration. In the absence of any such facts submitted by the Appellant, he would be treated resident in In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of purchase of immovable property amounting to ₹ 49,97,152/-. However, no such addition has been made on account of reasons for which the case was reopened. Relying on various decisions, he submitted that where there is no addition on the basis of reasons recorded, the AO loses jurisdiction to assess income under other heads or under other issue. For the above proposition, he relied on the decision of the Hon ble Delhi High Court in the case of Ranbaxy Laboratories Ltd. vs. CIT 12 taxman.com 74, the decision of the Hon ble Delhi High Court in the case of Tikaula Sugar Mills Ltd. vs. DCIT, ITA No.86/2006, order dated 21.01.2016, the decision of the Hon ble Delhi High Court in the case of Oriental Bank of Commerce vs. Addl.CIT, 49 taxman.com 485 and various other decisions. 5.1 Referring to the following decisions, he submitted that the reasons based on patently incorrect facts do not clothe the AO to issue a valid notice u/s 148 being without application of mind and without foundation:- i) Kolahai Infotech P. Ltd. vs. (2018) 409 ITR 595 (Del); ii) Shamshad Khan vs. ACIT [2017] 395 ITR 265: 82 taxmann.com 35 (Delhi); iii)Mumtaz Hazi Mohamad Memon (2018) 408 ITR 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 49,97,152/-, however, it is a fact that the AO has made addition of ₹ 3,50,000/- on account of stamp duty for purchase of the property. Therefore, the argument of the ld. Counsel that the addition has not been made on account of the reasons for which the case was reopened and, therefore, the AO cannot make any other addition is without any basis and misplaced and cannot be accepted. The ld. CIT(A) has given justifiable reasons while upholding the validity of the reassessment proceedings. So far as the merit of the case is concerned, the ld. DR heavily relied on the order of the CIT(A). 9. I have considered the rival arguments made by both the sides, perused the orders of the Assessing Officer and CIT(A) and the paper book filed on behalf of the assessee. I have also considered the various decisions cited before me. I find, the AO reopened the assessment of the assessee on the basis of information available on record that the assessee has purchased an immovable property amounting to ₹ 49,97,152/- during the F.Y. 2010-11 relevant to A.Y. 2011-12. However, he completed the assessment determining the total income of the assessee at ₹ 22,77,980/- wherein he mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I find, identical issue had come up before the coordinate Benches of the Tribunal in the case of Avdesh Kumar (supra). In that case, the AO, during the course of assessment proceedings had observed from the bank extract furnished by the assessee that it had received salary outside India (Korea) which had not been declared in the return of income and the assessee had also not claimed any relief u/s 90. The amount of such salary in Korean currency was converted into Indian currency. Keeping in view of 26AS wherein it was found that employer had deducted TDS on the entire income i.e., salary received in India as well as in Korea, the AO added back the salary income earned in Korea as income of the assessee. The ld.CIT(A) upheld the order of the AO. On further appeal by the assessee, the Tribunal set aside the order of the CIT(A) and directed the AO to delete the addition by observing as under:- 9. I have considered the rival arguments made by both the sides and perused the material available on record. I find on the basis of the Form 26AS the Assessing Officer made addition of ₹ 17,09,702/- which is the income earned by the assessee from his foreign employer received outside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), the period of stay of an individual should be 180 days for being a resident in India. Thus, the status of the assessee was a nonresident. In view of this fact, the income can be taxed only with the provisions of section 5(2)(a) of the Income-tax Act, 1961. The assessee has rendered services outside India and the income has accrued outside India. The only issue is that whether the amount credited in the NRI account of the assessee located in India as per his instructions to the employer can be taxed as per provisions of section 5(1 )(a) and (b) of the Income-tax Act, 1961 with regard to scope of income. We have considered all the facts of the case and we find that this issue is covered in favour of the assessee by the decision of Hon'ble ITAT in the case of Ranjit Kumar Bose vs. ITO reported in 18 ITD 230 (ITAT - Calcutta) where it is held as under :- 14. True, in this case, salary income accrued outside India, but was received in India in the same accounting year. It is clear that salary income could not have been brought to tax on accrual basis for the simple reason that it accrued outside India. The provisions of section 5(2)(a) are subject to section 15 which, inter a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y amounting to ₹ 49,97,152/- meaning thereby he has accepted the source of that huge amount. So far as the amount of ₹ 3,50,000/- towards the stamp duty is concerned, a perusal of the assessment order shows that the amount was paid by Mrs. Vandana Bhardwaj as per the ledger account of M/s Landcraft Developers Pvt. Ltd. which was reproduced by the AO in the body of the assessment order. Therefore, when the money was paid by Mrs. Vandana Bhardwaj, there was no reason for making the addition in the hands of the assessee. The ld. CIT(A) had not given any cogent reason as to why 50% shall be added in the hands of the assessee when the payment was admittedly made by Mrs. Vandana Bhardwaj, a fact brought on record by the AO himself. In any case, if the order of the CIT(A) is accepted, then, 50% of the investment in the property also should be borne by the wife of the assessee, Mrs. Vandna Bhardwaj. Thus, the finding of the CIT(A) becomes contradictory. Since the AO himself has given a finding that Mrs. Vandana Bhardwaj had made the cash payment on 03.12.2010 as per the records maintained by M/s Landcraft Developers Pvt. Ltd., therefore, I do not find any reason to sustain 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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