BHARAT BHUSHAN GUPTA,MUMBAI vs. ITO INTL TAX WARD 2(3)(1), MUMBAI

All the grounds raised by the assessee are inter-related and inter- connected and relate to challenging the additions made by the Ld. CIT(A). Therefore, we have decided to adjudicate these grounds for the purpose of a consolidated order.

The only dispute which requires adjudication at this stage is with regard to the residential status of the assessee.

After having gone through the facts of the present case and hearing the parties at length, we found that the case of the assessee was selected for scrutiny. Since the assessee had claimed income of Rs. 53,46,358 as exempt income from taxation, therefore, after providing an opportunity of hearing to the assessee, the AO observed that the exempt income of Rs. 53,46,358 comprised salary income of Rs. 52,56,706, NRE interest income of Rs. 86,576, and Rs. 3,076 credited in the NRE bank accounts of the assessee held with HDFC Bank and Oriental Bank of Commerce.

However, it was further noticed that the assessee left India during the year partly for the purpose of employment and partly for the purpose other than employment. Thus, it was held that the assessee, being a citizen of India, had left India for a period of 172 days only for the purpose of employment during the year under consideration, as against the minimum number of 184 days of stay outside India as required for the purpose of employment under the Income Tax Act, 1961. Accordingly, while passing the order under section 143(3) of the Income Tax Act, the AO held the assessee as a "resident" in India as per the provisions of section 6(1)(c) of the Income Tax Act. Although this order was challenged before the CIT(A), however, the order of the AO was upheld by dismissing the appeal of the assessee.

Now, before us also, it was submitted that the assessee had stayed outside India for a further period of 90 days on tourist visa in Singapore and Thailand for job search and business development activities, and that these 90 days should also have been considered as days of stay outside India for employment purposes. However, after considering the documents placed on record and the submissions of the assessee and the orders passed by the revenue authorities, we noticed that the said contention was not acceptable to the revenue authorities on the ground that the assessee had not submitted any details and evidence to substantiate these arguments.

Although the assessee submitted that the AO, during the course of assessment, had never asked for these documents, therefore, the assessee could not submit the documents with regard to the further stay of 90 days outside India.

Be that as it may, without going into the merits of the issue, we deem it appropriate to restore the matter back to the file of the AO for deciding the same afresh after providing an opportunity of hearing to the assessee, subject to a cost of Rs. 5,000/-, which shall be deposited by the assessee in the PM's Relief Fund and the receipt of the same be filed before the AO within 30 days from the date of receipt of the order. The assessee is also at liberty to file any other document to substantiate the claim

Before parting, we make it clear that our decision to restore the matter back to the file of the AO shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the AO independently in accordance with law.