TaxTMI 
TaxTMI 
2010 (12) TMI 940
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....ammed Kutty appearing for the respondent-assessee. 3. The assessee's residential status for assessment arose for the assessment year 1989-90 in the course of completion of block assessment for the period 1989-90 to 1999-2000. While filing the return, the assessee claimed his residential status as "non-resident" for the assessment years 1989-90 and 1990-91, and for all the remaining years, he mentioned his status as "not ordinarily resident". The assessee admitted in the course of enquiry that he had gone abroad and took up business there, or in other words, he had not gone there to take up employment under any employer. The Assessing Officer, therefore, held that since the assessee went abroad for the first time on September 24, 1988, and ....
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....ear 1989-90 assigning the status of "resident" to the respondent-assessee bringing into tax in India his global income, in the appeal filed by the assessee, the Commissioner of Income-tax (Appeals) held that going abroad for doing business also is covered by Explanation (a) to section 6(1)(c) of the Act inasmuch as employment referred to the above Explanation takes him self-employment also. On second appeals filed by the respondent-assessee and the Revenue, the Tribunal confirmed the order of the Commissioner of Income-tax (Appeals), against which this appeal is filed. 4. In order to decide the question, the scope of Explanation (a) to section 6(1)(c) of the Act has to be examined, which reads as follows : "6. For the purpos....
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....(c) of the Act, under which 60 days residence referred to in clause (c) is substituted to 182 days if the assessee went abroad in the previous year for the purpose of employment. Admittedly, the assessee went abroad on September 24, 1988, only to take up business there. If the business undertaken and carried on by the assessee in the previous year abroad amounts to employment within the meaning of Explanation (a) to section 6(1)(c) of the Act, then the assessee is entitled to the status of non-resident declared by the Commissioner of Income-tax (Appeals), which is confirmed by the Tribunal. 6. The contention of the learned senior counsel appearing for the Revenue is that employment necessarily involves employer-employee relationship....
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....s, who are employed or engaged in other avocations outside India, the Finance Act has made the following modifications in the tests of residence in India : . . . (iii) Where an individual who is a citizen of India leaves India in any year for the purposes of employment outside India, he will not be treated as resident in India in that year unless he has been in India in that year for 182 days ore more. The effect of this amendment will be that the test of residence in (c) above will stand modified to that extent in such cases." 9. What is clear from the above is that no technical meaning is intended for the word "employment" used in the Explanation. In our view, going abroad for the purpose of employment only means that the visit a....