9911796707
TMI Blog2003 (1) TMI 240X X X X Extracts X X X X X X X X Extracts X X X X ..... t assessment year being expired on 31-3-1991 for the year under consideration. It was further seen by the Assessing Officer that the assessee had earned from Univan Ship Management Ltd. US $ 11,071 equivalent to Indian currency for Rs. 1,60,384 as revealed from the computation of income filed by the assessee with time barred return of income. It was further noticed that the said amount was earned for his services with the shipping company from 19-7-1988 to 9-12-1988, that is, for his stay outside India for 143 days. It was also seen by the Assessing Officer that the assessee had been in India for 222 days and, therefore, he was definitely a resident in India for which his global income is taxable. Thus for the reasons (i) that his original return was not valid and (ii) that the claim of exemption of income earned from Univan Ship Management Ltd. was not proper and allowable the income had escaped assessment in the opinion of the Assessing Officer having obtained the previous approval of Addl. CIT, Range-6, Kolkata, notice under section 148 was issued by the Assessing Officer. On an appeal the CIT(A) confirmed the initiation of proceedings under section 147. Hence the assessee is in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the assessment year under consideration. It was contended by the Ld. counsel for the assessee that the correct interpretation of sub-section (6) of section 6 would be that a person, to be a "not ordinary resident", should not be a resident in nine out of the ten previous years preceding that year or in other words, the person should be a non-resident in at least two out of the 10 previous years preceding that year, to be a "not ordinarily resident" in India. The interpretation that a person, to be a not ordinarily resident, should be a non-resident in nine out of the ten previous years preceding that year or should have not been resident in India in all nine out of the ten previous years preceding that year is wrong interpretation of sub-section (6) of section 6 of the Act. In support of his contention the Ld. counsel has placed reliance on the commentaries of some learned authors and on an article written by Sri S.R. Das, Advocate and Sri Jitesh Sonee, Chartered Accountant, published in Bharat's Tax Corporate Referencer, Vol. 27 Part 3 dated 10th October, 2002. 6. The Ld. D.R., on the other hand, supported the orders of the authorities below and reiterated the reasons relie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dinarily residents; and (3) Non-residents. The provisions of section 5 are reproduced below for ready reference: "5. (1) Subject to the provisions of this Act, the total income of any previous year of a person who is a resident includes all income from whatever source derived which-- (a) is received or is deemed to be received in India in such year by or on behalf of such person; or (b) accrues or arises or is deemed to accrue or arise to him in India during such year; or (c) accrues or arises to him outside India during such year; Provided that, in the case of a person not ordinarily resident in India within the meaning of sub-section (6) of section 6, the income which accrues or arises to him outside India shall not be so included unless it is derived from a business controlled in or a profession set up in India. (2) Subject to the provisions of this Act, the total income of any previous year of a person who is a non-resident includes all income from whatever source derived which-- (a) is received or is deemed to be received in India in such year by or on behalf of such person; or (b) accrues or arises or is deemed to accrue or arise to him in India during such ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontrolled in or profession set up in India. The fact of giving similar benefit of the exemption of income which accrues or arises outside India to Non-Resident and as well as to "Resident but not ordinarily resident" unless the said income is derived by "resident but not ordinarily resident" from a business controlled in or a profession set up in India and at the same time not giving the same benefit to Resident clearly shows that a person to be a "Resident but not ordinarily resident" and then to get the benefit of exemption of income which accrues or arises to him outside India unless it is derived from a business controlled in or a profession set up in India, he should not be a resident in nine out of the ten previous years preceding that year, or, in other words, he should be a non-resident in nine out of the ten previous years preceding that year. The exemption of not including the income which accrues or arises to a person outside India is available to "not ordinarily resident" and not to "ordinarily resident" again goes to show that a person should not have been resident in India in all 9 out of ten previous years preceding that year to avail the benefit of exemption as prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ------------------------ Financial Year Stay in India Status -------------------------------------------------------------------- 1978-79 160 days N.R. 1979-80 365 " Resident 1980-81 365 " Resident 1981-82 117 " N.R. 1982-83 9 " N.R. 1983-84 220 " Resident 1984-85 365 " Resident 1985-86 365 " Resident 1986-87 365 " Resident 1987-88 365 " Resident -------------------------------------------------------------------- On perusal of the break-up submitted by the assessee it is clear that the assessee waS a resident in 7 out of 10 previous years though in order to be a non ordinarily resident he should not have been resident in 9 out of 10 previous years. In other words he should be a non-resident in 9 out of 10 previous years. In the instant case the condition or criteria a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
