TaxTMI 
TaxTMI 
2023 (8) TMI 817
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.... Assessment Year (AY) 2015-16 are quite identical. It is admitted fact that adjudication in any appeal would apply to the other appeals also. For the purpose of adjudication, IT(TP)A No.51/Chny/2018 in the case of Shri Ramesh Kumar AE has been taken as the lead appeal. This appeal arises out of the order of learned Commissioner of Income Tax (Appeals)-16, Chennai [CIT(A)] dated 26-07-2018 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) of the Act on 29-12-2017. The grounds taken by the assessee read as under: "1. The order of the Commissioner of Income Tax (Appeals) ['CIT(A)'] is contrary to law, facts and circumstances of the case. 2. Disallowance of claim of exemption under Article....
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....e CIT (A) failed to appreciate that under section 9(1)(ii) of the Act, income from salary is taxable in India if it is earned in India. It is submitted that if service is not rendered in India then income from salary is not subject to tax under the Act. 2.5 The learned CIT (A) ought to have appreciated that the employment cost reimbursement was on a cost to cost basis and as such there is no income taxable in India. 2.6 The learned CIT (A) failed to appreciate the fact that the appellant was working solely for Ford China, was economically associated with Ford China alone during the assignment. 3. The learned CIT (A) erred in concluding without any basis that Ford India will have a direct benefit in the form of ser....
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....e taxable instead of Rs. 69.69 Lacs as offered by the assessee. 3.2 It transpired that the assessee was employed with M/s Ford Motor Private Ltd. in India. He was sent to China on an assignment from August, 2014 onwards. The salary continued to be paid in India by the employer. The assessee submitted that he being tax resident of China, the salary income was taxable in China only and the same has been offered to tax in China. Further, he being non-resident, the salary received in India for work performed in China would be exempt in India as per Article 15(1) of DTAA between India and China. The assessee submitted that salary is taxable in India only if it accrues in India and salary is considered to be accrued where the employment is exe....
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....though the salary has been received in India from existing employer. It is also a fact on record that this salary, for work performed in UK, has been offered to tax in UK which is evident from Tax Returns filed in UK. The assessee submit the as per Article 16(1) of DTAA, this income would be taxable in UK only. Alternatively, the assessee relies on the provisions of Sec.15 read with Sec.5(2) and Sec.9(1)(ii) which provides for taxability of salary on accrual basis and not on receipt basis. However, Ld. CIT(A) has held that the assessee would not be eligible for the benefit of DTAA since DTAA relief is to be given by resident country which is UK in the present case. 6. We find that an identical issue has been addressed by coordinate....
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....gh Wadhawan (247 ITR 260); decision of Hon'ble Calcutta High Court in Sumanabandyopadhyay V/s DDIT (TS- 281-HC-2017) as well as CBDT Circular No.13/2017 dated 11/04/2017. 7. We find that facts are pari-materia the same before us and the ratio of this decision is squarely applicable to the present case. Therefore, we would hold that salary income as accrued to the assessee for work performed in UK would not be taxable in India. However, the salary received for work performed in India would be taxable in India. Accordingly, we direct Ld. AO to re-compute the income of the assessee. The above proposition is also supported by the fact that upon perusal of UK tax return, it could be seen that the assessee has offered earnings from emplo....
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....Act. The regular salary accrued to any assessee is chargeable to tax in terms of Sec.15(a). Even as per the provisions of Sec.9(1)(ii), salary income could be deemed to accrue or arise in India only if it is earned in India in respect of services rendered in India. The bench, reading down Article-1 and Article-15 of India-Australia DTAA, held that Treaty benefit shall be applicable to persons who are residents of both India as well as Australia. Therefore, the contention of the revenue that the assessee being a non-resident and hence treaty benefit cannot be extended to assessee, is incorrect. Accordingly, it was held by the bench that the salary so earned for work performed in Australia would be taxable in Australia. The case law of Swamin....