TaxTMI 
TaxTMI 
2006 (8) TMI 449
X X X X Extracts X X X X
X X X X Extracts X X X X
....and continuous discharge certificate for the previous years it was found by the Assessing Officer that during the last 10 years the assessee's status in India is as under : Assessment year 1998-99 Financial year No. of days stayed Status 88-89 365 Resident 89-90 365 Resident 90-91 186 Resident 91-92 289 Resident 92-93 73 Non-resident 93-94 96 Non-resident 94-95 104 Non-resident 95-96 257 Resident 96-97 165 Non-resident 97-98 267 Resident Assessment year 1999-2000 89-90 365 Resident 90-91 186 Resident 91-92 289 Resident 92-93 73 Non-resident 93-94 96 Non-resident 94-95 104 Non-resident....
X X X X Extracts X X X X
X X X X Extracts X X X X
....led and the Assessing Officer was directed to adopt the status of not ordinarily resident. 7. During the course of proceedings before us the Ld. D.R. pointed out that one has to see as whether the assessee has been a resident in 9 out of 10 previous years. The Act has not given any definition of ordinarily resident. For ascertaining the status of not ordinarily resident, one has to verify as to whether the assessee has been a resident or not in 9 out of 10 previous years. It was further stated that the second condition mentioned in section 6(6) is also relevant and it also suggests that one should first ascertain the residential status. The Ld. D.R. relied on the decision of the Gujarat High Court in the case of Pradip J. Mehta v. CIT [2....
X X X X Extracts X X X X
X X X X Extracts X X X X
....en though he has been resident in India within the meaning of section 6(1) of the Act. If the assessee has been resident in India for 9 out of 10 years, he will be ordinarily resident in India otherwise he will be not ordinarily resident in India. This contention appears to be attractive but the interpretation of section 6(6)(a) does not support such view. Section 6(6) does not define ordinarily resident in India. It describes not ordinarily resident in India. It means one has to take the concept of resident in India for which the criteria is laid down in section 6(1) of the Act. An individual who has not been a resident in India within the meaning of section 6(1) for less than 9 out of 10 previous years does not satisfy the statutory crite....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Sastri, J. vividly illustrated the matter by observed as under (page 425) : 'A person by adopting the simple expedient of being absent, say, in a neighbouring India State for 3½ months every year during the seven years period referred to in the section, could relieve himself of his status as an 'ordinarily resident', however close in quality and preponderating in duration his connection with British India may be. This, it seems to me, could not have been intended by the Legislature, and a construction which would lead to such repugnant results should not be readily accepted'." 11. Section 6(1) of the Income-tax Act, specifies the requirements for treating an individual to be resident in India in any previous year. For ready ref....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ition is obviously not satisfied because the assessee has been in India for more than 730 days during the seven previous years preceding the year for which status is to be determined. For arriving at the above conclusion in respect of status of the assessee, we also rely on the decision of the Debapriya Guha v. Asstt. CIT [2004] 88 ITD 404 (Kol.). 12. The Ld. Gujarat High Court in the case of Pradip J. Mehta (supra) has discussed all the case laws on which the reliance was placed by the assessee before the Ld. CIT(A). It will be relevant to note that section 6(6) has been amended by the Finance Act, 2003. The amended section is as under : "[(6) A person is said to be "not ordinarily resident" in India in any previous year if such pers....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the ten previous years preceding that year, or has not during the seven previous years preceding that year been in India for a period of, or period amounting in all to, seven hundred and thirty days or more. This definition has been subject to differing legal interpretations. In order to remove any doubts in this regard, it is proposed to substitute the existing definition with a new one to provide that a person would be "not ordinarily resident" in India in any previous year if such person is an individual who has been a non-resident in India in nine out of the ten previous years preceding that year, or has during the seven previous years preceding that year been in India for a period of, or period amounting in all to, seven hundred an....