Burden of proof on residence status and capital remittance upheld where taxpayer failed to substantiate exceptions and capital character.

Where the statutory conditions for residence under section 4A(a)(iii) were otherwise satisfied, the taxpayer bore the burden of proving that presence in India during the relevant year was only occasional or casual; on the record, no such evidence was produced, so resident-but-not-ordinarily-resident status was not established. The taxpayer also had the burden of proving that a remittance from Burma represented capital and not accrued profits; in the absence of account books, satisfactory explanation, or reliable supporting material, the remittance was not shown to be capital in nature. The assessment was therefore sustained on both issues.

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Issues: (i) Whether the assessee was a resident but not ordinarily resident in India during the relevant previous year within the meaning of section 4A(a)(iii) of the Indian Income-tax Act, 1922. (ii) Whether the sum of Rs. 2 lakhs remitted from Burma to India in 1947 was proved to be the assessee's capital asset and not remitted out of accrued profits.

Issue (i): Whether the assessee was a resident but not ordinarily resident in India during the relevant previous year within the meaning of section 4A(a)(iii) of the Indian Income-tax Act, 1922.

Analysis: The provision applied because the assessee had been in India for more than 365 days during the preceding four years and was in India during the relevant year. In such a case, the remaining question was whether the stay in the relevant year was only occasional or casual. The burden of proving that exception lay on the assessee. No evidence was produced to show that the visit in 1947 was occasional or casual, and the affidavit also did not state any reason for the visit or assert that it was casual. The finding that the assessee failed to discharge the burden was therefore supported by evidence and was a finding of fact.

Conclusion: The answer to this issue was against the assessee and in favour of the Revenue.

Issue (ii): Whether the sum of Rs. 2 lakhs remitted from Burma to India in 1947 was proved to be the assessee's capital asset and not remitted out of accrued profits.

Analysis: The assessee had the burden of proving that the remittance represented capital and not business profits. He did not produce the account books before the tax authorities despite opportunity, and the photostat copies relied upon were not shown to have been properly relied on below or raised in the reference. There was no satisfactory explanation for the remittance, and the surrounding circumstances did not establish that it was capital in nature. The Tribunal's conclusion that the remittance had not been proved to be capital was supported by the record.

Conclusion: The answer to this issue was against the assessee and in favour of the Revenue.

Final Conclusion: The assessments were upheld, and no interference was called for with the concurrent finding that the assessee's status and the character of the remittance were correctly determined against him.

Ratio Decidendi: Once the statutory conditions for residence are shown or admitted, the assessee bears the burden of proving that the stay was merely occasional or casual; similarly, a taxpayer who asserts that a remittance is capital rather than income must prove that assertion with satisfactory evidence.

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