Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, Hyderabad ‘A’ Bench, Hyderabad
Before: Shri S.S. GODARA & Shri L.P. SAHU
[PAN: AJNPR7153F] (Appellant) (Respondent) Assessee by: Sri Purushotham Anand, Adv. Revenue by: Sri Sunil Kumar Pandey, DR Date of hearing: 04/02/2021 Date of pronouncement: 25/02/2021 ORDER PER BENCH This assessee’s appeal for A.Y. 2014-15 is directed against the Commissioner of Income Tax (Appeals)–10 [‘CIT(A)’ for short], Hyderabad’s order dated 19.04.2018 in case no. 0202/2016-17, involving proceedings u/s 143(3) of the Income Tax Act, 1961 [ ‘the Act’ for short].
AY 2014-15 Sri Vekata Ramarao Telakalapalli , Hyd.
Heard both parties. Case file perused.
It transpired at the outset that the assessee’s sole substantive grievance challenges the correctness of both lower authorities’ action assessing him as a non-resident for the purpose of taxing Rs. 28,33,027/- representing foreign allowances received for services performed in the Netherlands by involving section 5(2) of the Act.
2.1. Relevant facts of the instant case indicate that we need not dig much deeper into the issue. This assessee had admittedly worked as an employee of M/s IBM India Pvt. Ltd. He had been deputed in lieu of service performed outside India which in turn led to the amount in issue received as foreign allowance(s).
2.3. The Revenue’s case in line with lower authorities action is that sec. 5(2) comes into play the moment impugned sum has been credited or received in India and any deviation thereof shall render the statutory provisions itself as redundant. We find no merit in Revenue’s foregoing stand. Various judicial precedents hon’ble Bombay high court in CIT vs. Avtar Singh Wadhwan reported in 247 ITR 260 (Bom.) ; DIT vs. Prahlad V Rao 198 taxman 551 (Kar) and Utanka Roy vs. DIT WP no.369/2014 dated 15.12.2016 (Calcutta HC) hold that such an income derived by a non- resident for performing service activities outside India, the accrual of income AY 2014-15 Sri Vekata Ramarao Telakalapalli , Hyd. thereon happens outside India could not be brought to tax in India as per s.5(2) of the Act. We thus delete the impugned addition for this precise reason alone.
This assessee’s appeal is allowed.
Order pronounced in the Open Court on 25th February, 2021.