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TMI Blog2024 (11) TMI 1316X X X X Extracts X X X X X X X X Extracts X X X X ..... esident u/s 5(2) of the Act and only income received or deemed to have accrued or arisen in India, is taxable for a non-resident. We undisputedly note that the assessee is a non-resident employee in IBM India Pvt. Ltd. (an Indian Company) and was sent to abroad to Indonesia for rendering services there. We find no dispute that the services were rendered in Indonesia and the foreign assignment allowances received by the assessee for services rendered in Indonesia and no evidence suggests that income accrued or arose in India. We note that the assessee failed to produce the TRC before the AO which is a procedural lapse and does not negate the substantive compliance. After considering the facts and circumstances of the case and following the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... educted as tax at source as per Form No.16 filed by the assessee. During the relevant assessment year, the assessee also received remuneration and other allowances from the foreign assignment amounting to Rs. 62,10,499/- in Indonesia. The details of breakup of such allowances are as under: i. Rs. 40,40,749/- received from Axis travel currency card; ii. Rs. 21,20,960/- as remuneration deposited in ICICI bank a/c iii. Rs. 48,790/- related to stock options for service rendered outside India. 2.1 The assessee filed his return of income declaring total taxable income of Rs. 49,590/- claiming that the income received and accrued in Indonesia for rendering service outside India, was not taxable u/s 5(2) of the Act. The assessee also claimed a refu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome earned or accrued in India is taxable u/s 5(2) of the Act; c) the allowances received from foreign assignment for rendering service in Indonesia, was not taxable in India; d) the addition of Rs. 21,20,960/- claimed as exempt under Article 15(1) of the India Indonesia DTAA, is unwarranted; e) the failure to produce TRC should not be invalidate the exemption since substantive compliance was achieved by proving the employment and residential details in India; f) further, the addition of Rs. 40,89,539/- as income accrued in India is erroneous as this amount was received for services rendered entirely outside India. 4.1 The ld. AR stated that the foreign allowances of Rs. 62,10,499/- received by the assessee outside India for services render ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Company) and was sent to abroad to Indonesia for rendering services there. We find no dispute that the services were rendered in Indonesia and the foreign assignment allowances received by the assessee for services rendered in Indonesia and no evidence suggests that income accrued or arose in India. We note that the assessee failed to produce the TRC before the Assessing Officer, which is a procedural lapse and does not negate the substantive compliance. After considering the facts and circumstances of the case and following the decision in the case of DCIT vs. Sudipta Maity (supra), we find it necessary to delete the addition made by the Assessing Officer of Rs. 21,20,960/-, Rs. 40,40,749/- and Rs. 48,790/- respectively (totalling to Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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