Concessional wealth-tax rate denied where a not ordinarily resident individual did not satisfy the not resident condition.

Rule 3 of Part II of Schedule I to the Wealth-tax Act grants the concessional rate only to an individual who is not a citizen of India and is also not resident in India. The Act treats residence as three mutually exclusive categories: resident, not resident, and not ordinarily resident. A person classified as not ordinarily resident cannot be treated as not resident for this concession. As the assessee was admittedly not ordinarily resident in India, the statutory condition of being not resident in India was not met, and the concessional rate was therefore unavailable.

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Issues: Whether the concessional rate of wealth-tax under Rule 3 of Part II of Schedule I to the Wealth-tax Act, 1957 applies to an individual who is not a citizen of India and is not ordinarily resident in India.

Analysis: The rule grants the concessional rate only to an individual who is not a citizen of India and who is also not a resident of India. The Act recognises three mutually exclusive categories of residence for an individual: resident in India, not resident in India, and not ordinarily resident in India. A person falling within the third category cannot be treated as belonging to the second category. Since the assessee was admittedly not ordinarily resident in India, the condition of being not resident in India was not satisfied.

Conclusion: The concession under Rule 3 was not applicable to the assessee.

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