1998 (6) TMI 38

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....) of the Wealth-tax Act ? (ii) Whether under the facts and circumstances of the case, the Tribunal was right in holding that the requirement of section 5(1)(xxxiii) of the Wealth-tax Act with section 6 of the Income-tax Act was not satisfied by the petitioner ?" The assessee is a karta of the Hindu undivided family and a resident of India. For a period of one year the karta of the Hindu undivided family went abroad for the purpose of taking possession of land which had been held by a company on the winding up of which the land was allotted to the Hindu undivided family. After that he sold the land abroad and returned to India after one year. These proceeds were invested in other properties in India. It was claimed by the assessee t....

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....he company. The assessee claimed the benefit of exemption for a period of seven years for the assets acquired in India out of the money realised by the sale of the lands abroad. The assessee's claim was negatived uniformly by all the authorities from the Income-tax Officer to the Tribunal. Learned counsel for the assessee contended that the assessee had resided abroad for a period of one year and, therefore, the residence of the karta abroad should be construed as the residence of the Hindu undivided family and such residence further regarded as "ordinarily resident" in a foreign country. It is also submitted that if so construed, on the return of the karta to India and reinvestment of those funds included, the assessee would be entitled....

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.... the other words used in the section. "Ordinarily resident" in a foreign country must be read along with the other words which require an intention to permanently reside in India after return. "Ordinarily" in this context refers to residence of long duration outside the country. The duration being long enough for the person to regard himself as being "ordinarily resident" of the country outside India and not to regard India as his permanent place of residence. A person who normally resides in India and for whom India is a permanent residence cannot claim the benefit of the section merely by travelling abroad and residing abroad for a period of one year and thereafter returning to his own country. The intention of such a person was always to....