S.ARUL MURUGAN,CHENNAI vs. ITO, CHENNAI

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ITA 1100/CHNY/2017Status: DisposedITAT Chennai11 July 2017AY 2009-104 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found mistakes apparent from the record in the intimation issued under Section 143(1). The issues were restored to the AO for verification of the assessee's non-resident status and the source of salary income.

What were the facts?

The assessee, a non-resident, claimed salary earned outside India as exempt in his return. The CPC processed the return, showing the assessee as non-resident but taxing the claimed exempt salary and not considering self-assessment tax paid.

What were the issues?

Whether the intimation under Section 143(1) contained mistakes apparent from the record that were rectifiable under Section 154, concerning the taxation of salary earned by a non-resident outside India.

Which sections of the Income-tax Act were involved?

Section 143(1),Section 154

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH: CHENNAI

Before: SHRI GEORGE MATHAN, & SHRI A. MOHAN ALANKAMONY

Hearing: 11.07.2017Pronounced: 11.07.2017

आदेश / O R D E R

PER GEORGE MATHAN, JUDICIAL MEMBER:

1.

the Order of Commissioner of Income Tax (Appeals)-16, Chennai, in dated 22.03.2017 for the AY 2009-10.

ITA No.1100/Mds/2017 :- 2 -:

2.

Smt. R. Rajeswari, JCIT, represented on behalf of the Revenue and Shri S.Sridhar, Adv., represented on behalf of the assessee.

3.

It was submitted by the Ld.AR that the assessee is an individual who is having a non-residence status for the AY 2009-10. The assessee had received salary of Rs.27,90,400/- from M/s.Gati Asia Pacific PTE Ltd. The assessee had filed his original return of income for the AY 2009-10 on 08.10.2009, wherein, the assessee had in Schedule-EI under the head exempt income specified the amount of Rs.27,90,400/- as exempt. The assessee had consequently claimed the refund of Rs.2,54,120/- paid as self-assessment tax. The return filed by the assessee came to be processed by the Central Processing Centre, Bangalore and an intimation u/s.143(1) came to be issued on the assessee wherein the status has been recorded as non-resident but tax has been computed on his salary which he has claimed as exempt. Aggrieved with the intimation u/s.143(1), the assessee has filed rectification application u/s.154 on 31.07.2010 intimating that he has filed the return of income admitting ‘Nil’ income by claiming exemption on the income of Rs.27,90,400/- since the same was earned outside India and also on the ground that the he was outside India for 288 days for the relevant AY. It was a submission that the rectification application filed by the assessee came to be disposed off vide order dated 26.05.2016 by the AO wherein it was mentioned that there is no mistake apparent from the record. Consequently, the rectification petition was rejected. It was a submission that on appeal, the ITA No.1100/Mds/2017 :- 3 -:

Ld.CIT(A) upheld the stand of the AO. It was a submission that the assessee being a non-resident and having filed return of income disclosing ‘Nil’ income and claiming the salary received by him from his employment outside India as exempt, the mistake committed by the CPC at Bangalore in respect of return of income filed by him, was a mistake which was rectifiable u/s.154. It was a submission that the orders of the AO & the Ld.CIT(A) may be reversed and the AO directed to rectify the mistake in respect of the intimation u/s.143(1).

4.

In reply, the Ld.DR vehemently supported the orders of the AO & the Ld.CIT(A).

5.

We have considered the rival submissions. A perusal of the return filed by the assessee clearly shows that the assessee has shown his status as non-resident. A perusal of the intimation u/s.143(1) also shows that the status of the assessee has been taken as non-resident. However, when entering the details of the salary, which has been claimed as exempt by the assessee in his return, the same has not been done correctly by the CPC. A perusal of the intimation issued also shows that even the self- assessment tax paid by the assessee has not been considered in the intimation. Thus, it clearly shows that there are mistakes apparent from the record which requires to be rectified in the intimation issued u/s.143(1). In these circumstances, in the interest of natural justice, the issues in this appeal restored to the file of the AO for verification as to ITA No.1100/Mds/2017 :- 4 -:

whether the assessee is a non-resident and as to whether the salary received by him is in fact from the employer outside India in respect of the employment outside India. If it is so, then the assessee’s salary income received by him is not liable to tax in India.

6.

In the result, the appeal filed by the assessee is partly allowed for statistical purposes.

Order pronounced in the Open Court on July 11, 2017, at Chennai.

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