Advance ruling on taxability of salary of Indian working abroad

In Re Shri Anurag Chaudhary (Authority for Advance Rulings)

An individual who resides in India for a period of less than 182 days during the previous year and is residing outside India for the purpose of employment, then irrespective of the fact of his presence in India for the period of 365 days or more during the preceding 4 previous years, he cannot be treated as a resident of India for the purpose of taxing his salary income earned by virtue of employment outside India under section 5(1)(c) of the Income Tax Act, 1961 [Shri Anurag Chaudhary – AAR No. 839 of 2009(2010- TIOL-05-ARA-IT)]

Facts:

Shri Anurag Chaudhary (applicant), a software engineer, was an employee of NIIT Technologies Limited (NIIT – India). NIIT India assigned the applicant to work in its group company NIIT Technologies Inc. (NIIT USA) for a specific period. The applicant left India on 31 March 2008 for the purpose of employment with NIIT USA and returned to India on 29 November 2008. Accordingly, his stay in India was 123 days during the financial year 2008-09 (F.Y. 2008- 09).

In order to determine whether the income earned by the applicant by way of salary from his employment with NIIT USA during the F.Y. 2008- 09 was liable to tax under section 5(1)(c) or any other provision of the Income Tax Act, 1961 (Act), the applicant sought an advance ruling from the Authority for Advance Ruling (AAR).

Please become a Premium member. If you are already a Premium member, login here to access the full content.