Case Law Details
ITO (International Taxation) Ward -1(3), Bangalore v. Lohitakshan Nambiar (Bangalore ITA T) (ITA No. 1045/ Bang /2009)[2010-TII-201-ITA T-BANG-NRI]
Facts: – Lohitakshan Nambiar (‘tax payer’) was employed by a Malaysian Company – Barber Ship (‘employer / company’) and was working on board an ocean liner owned by the company. During the tax year 2005-06, the tax payer had stayed outside India for 222 days. Hence, he was a non-resident for Indian tax purposes.
The employer had paid the salary to the tax payer, on board the ocean liner and at his request credited a portion of the salary to the tax payer’s NRE bank account in India. Assessing Officer (AO) held that the amount of Rs. 944,450/- credited to the bank account in India was taxable u/s 5(2) of the Income-tax Act („Act?) since it was received in India. The AO also that since the tax payer was not a resident of any country in the said tax year, he could not avail any relief either under a Double Tax Avoidance Agreement (‘DTAA’) or the Act. The Commissioner of Income-tax (Appeals) ruled in favour of the taxpayer citing that services were rendered outside India and income accruing outside India was not taxable in India.
Aggrieved by the above order, the revenue preferred an appeal before the Tribunal.
Issue before the Tribunal :- Whether salary credited to a bank account in India for services rendered there by a non-resident was taxable in India?
Please become a Premium member. If you are already a Premium member, login here to access the full content.
