TaxTMI 
TaxTMI 
2015 (10) TMI 233
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....rds are : The assessee is working with Cognizant Technology Solutions as Sr.Software professional. The assessee filed his return of income for the AY.2009-10 on 30-07-2009 declaring total income of Rs. 2,07,00,360/-. During the course of scrutiny assessment, the Assessing Officer observed from the details furnished by the assessee that the assessee had opened a bank account in ICICI Bank and transferred a sum of Rs. 1,68,95,344/- from NRE Fixed Deposit account. The said sum represents maturity of Fixed Deposits of Rs. 87,56,634/- and interest element of Rs. 81,38,700/-. The Fixed Deposits in NRE account were made in the year 2002 that had matured in the year 2009. The interest received by the assessee was not offered to tax in the return of....
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....submitted that the assessee had opened NRE A/c when he was sent on foreign assignment by the company. Thereafter, the amounts in NRE Savings A/c were transferred to NRE Fixed Deposits account in the year 2002 on various dates. The Fixed Deposit accounts matured in January, 2009 and March, 2009. The assessee was under bonafide impression that since the investment has been made from NRE A/c, the interest income thereon is exempt from tax u/s.10(4) of the Act. The belief of the assessee was further fortified by the fact when the bank also did not deduct tax at source on the maturity value of the Fixed Deposits. However, the explanation furnished by the assessee was not accepted by the Assessing Officer. It is not a case where the assessee has ....
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....s in his return of income for the AY under consideration. The assessee had made investment in NRE Fixed Deposits from his NRE SB A/c in the year 2002. During that period, the assessee was sent on a particular assignment by the employer company to US. The assessee was allegedly under bonafide impression that since the deposits are made from NRE A/c, the interest income there from is exempt u/s.10(4), even though the assessee had returned to India and was a resident in India. The FERA, 1973 has been repealed and has been replaced with FEMA, 1999. The corresponding provisions contain in section 2(q) defining 'person resident outside India' in FERA, 1973 are contained in section 2(w) of FEMA, 1999. The 'person resident outside India....
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....India" means a person who is not resident in India;" 6. As per the contentions of ld.Counsel for the assessee, after returning back from USA, the assessee was not sure, whether he would stay in India or would be sent to another assignment abroad. Therefore, the assessee was allowed to retain NRE A/c till maturity. It is an admitted fact that the assessee was in the status of non-resident as per the provisions of FEMA (erstwhile FERA) during the years 2000-01, 2001-02 & 2002-03. The assessee returned to India in April, 2003. The investment was made by the assessee in NRE Fixed Deposit A/c during January, February & March, 2002. The bank also did not deduct tax at source on such interest income. This further gave impetus to the belief of the....