Arpit Gupta Vs DDIT/ADIT (ITAT Jaipur)
The Income Tax Appellate Tribunal (ITAT), Jaipur, allowed the assessee’s appeal against the order of the Commissioner of Income Tax (Appeals), which had confirmed a penalty of Rs.10 lakh imposed under Section 42 read with Section 46 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.
The penalty was levied by the Assessing Officer on the ground that during the financial year relevant to Assessment Year 2019-20, an amount of Rs.7,86,852 was credited to the assessee’s account from a source outside India. According to the Assessing Officer, the assessee neither filed a return of income for the relevant year nor disclosed the said amount. The Commissioner of Income Tax (Appeals) upheld the penalty.
Before the Tribunal, the assessee explained that he had worked as an employee of an offshore company in Dubai from 2016 to April 2018. During that period, he was neither a resident nor taxable in India. After returning to India, he did not earn any income in India and therefore did not file a return of income.
The assessee submitted that the amount of Rs.7,86,852 credited to his account was not income earned during the relevant financial year. Instead, it represented the maturity proceeds of a retirement plan funded through deductions made from his salary by his foreign employer during his employment in Dubai. According to the assessee, the amount was remitted by the foreign employer after he had left the job, and he was not aware of the remittance. He stated that he was under the bona fide belief that since he had not earned any income during the financial year 2018-19, he was not required to file a return of income.
