TaxTMI 
TaxTMI 
2005 (5) TMI 13
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....ng applicable only in a case where the person was assessed earlier as a non-resident, the Tribunal is right in law and fact in relying on the order of the Tribunal for a subsequent year (1992-93) for which year there was no adjudication of the issue by the Tribunal? 3. Whether, on the facts and in the circumstances of the case, should not the Tribunal have considered the issue on the merits for the assessment year without relying on an order for the subsequent year?" The assessment year is 1991-92. The assessee was a non-resident and he had deposited money in non-resident accounts with various branches of State Bank of Travancore, Central Bank of India, Indian Bank, etc. When he came back to India, he claimed concessional rate of tax ....
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....rovided that such individual is a person resident outside India as defined in clause (q) of section 2 of the said Act or is a person who has been permitted by the Reserve Bank of India to maintain the aforesaid account:" But, that benefit is applicable only so long as a person is completely a non-resident. But, normally, he will be liable to tax when he comes to India and becomes a resident. Section 115H as existed during the relevant time is as follows: "115H. Benefit under Chapter to be available in certain cases even after the assessee becomes resident.- Where a person, who is a nonresident Indian in any previous year, becomes assessable as resident in India in respect of the total income of any subsequent year, he may furnish to t....
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....uced (see : [1983] 140 ITR (St.) 27) as well as the object of incorporating section 115. The Budget speech reads as follows: "As I indicated earlier, I have decided to liberalise further the tax incentives in respect of non-resident Indians investing in India. I propose to levy a flat rate of tax of 20 per cent, plus surcharge on incomes derived by such persons from their specified investments in India made through foreign exchange remittances." The object as stated in the Finance Bill is as follows (see [1983] 140 ITR (St.) 132): "New section 115E seeks to provide that income-tax on any investment income or income by way of long-term capital gain of a nonresident Indian will be calculated at the rate of twenty per cent, plus surch....
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....f the assessee has to be accepted as held by the apex court in CIT v. Kulu Valley Transport Co. (P.) Ltd. [1970] 77 ITR 518. A taxing statute has to be interpreted strictly. The Supreme Court in A.V. Fernandez v. State of Kerala [1957] 8 STC 561; AIR 1957 SC 657, at page 661 observed as follows: "In construing fiscal statutes and in determining the liability of a subject to tax one must have regard to the strict letter of the law and not merely to the spirit of the statute or the substance of the law. If the revenue satisfies the court that the case falls strictly within the provisions of the law, the subject can be taxed. If, on the other hand, the case is not covered within the four corners of the provisions of the taxing statute, no t....
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....ange and there is no room for doubt that the subject-matter is clearly covered by section 115H. When words are clear and directly conveying the meaning, there is no need for any interpreting process as held by the apex court in Mangalore Chemicals and Fertilisers Ltd. v. Deputy CCT [1991] 83 STC 234 ; [1992] Suppl. 1 SCC 21. There is no other view possible than in favour of the assessee. Further, we also notice that the Authority for Advance Rulings, considered the same point and it was answered like this as can be seen from the decision reported in [1997] 223 ITR 379 (Advance Ruling Application No. P-5 of 1995): "Question No. 4: (a) No income-tax will be payable in India on the interest from the fixed deposits with the State Bank of Ind....