TaxTMI 
TaxTMI 
2024 (3) TMI 608
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....case wherein the assessee has stayed in India during the previous year for 166 days (which exceeds 60 days) and more than 365 days in preceding four years thereby completely becoming a resident in India as per the provisions of Section 6(1)(c) of the I.T. Act, 1961. 2. The learned CIT(A) has erred in law and on facts by accepting the claim of the assessee that he has left for employment outside India and therefore stay of 182 days in the previous year are required for becoming the resident by completely ignoring the fact that since the assessee has not left India for employment in the previous year relevant to the assessment, this exception is not applicable to the facts of the case. 3. The learned CIT(A) has erred in law and on facts in accepting the claim of the assessee that he has left for employment outside India and therefore, the threshold of 182 days is required to be applied, without calling for any documentary evidence in support of assessee's above mentioned claim which the assessee is duty bound to submit in order to fall in Explanation-1(a) to Section 6(1) of the I.T. Act, 1961. 4. The learned CIT(A) failed to examine the residential stat....
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....in not appreciating the fact that he was liable to pay tax in India, being a resident as mentioned in Ground No. 2 above, on his global income. 14. The Learned CIT(A) has erred in fact and in law that despite assessee being a resident the assessee failed to furnish his return of income in India as per the provisions of Section 139 of the IT Act and thus failed to offer to tax his global income. 15. Even if it is accepted for argument sake that the assessee was a non resident in relevant assessment year, the learned CIT(A) has failed to appreciate the following facts and legal issues: (i) Since the assessee was a resident till A.Y.2010-11 which is an admitted fact, huge investments have been made in Singapore in the immediately next year, the assessee is bound to explain the source of income, investments, expenses, cash/credit deposit etc., by providing credible documentary evidence in support of the above which the assessee has failed to submit and the learned CIT(A) has erred in law on this account. (ii) The learned CIT(A) has erred in law and on facts in accepting the claim of the assessee that that the source of investments/expenses of Rs. 1.6....
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....ssessee outside India have been met out from the income earned from the business sources/assets in India. Thus, the AO vide show cause notice dated 06th November 2017 proposed to treat the following expenses and investment by the assessee in Singapore as sourced from undisclosed/unexplained income from India: (1) Accommodation expenses Rs. 36,93,600/- (2) Tuition fee of the children's Rs. 44,85,773/- (3) Utility bill payment Rs. 1,09,777/- (4) Deposits in OCBC Bank Rs. 12,36,982/- (5) Investment in Global Impex Link Pvt Ltd USD 70,000 /- (6) Investment in Global Real Estate Solutions Pte USD 100,000/- 3.1 The assessee in response submitted that income on account of accommodation expenses, tuition fee of children, utility bill payment and investment in share has been covered and added to the income of his wife namely Smt. Mona Nilesh Patel, therefore, the same cannot be taxed in his hand. Regarding the deposit in bank accounts in OCBC Bank, it was submitted that the same was deposited out of withdrawal from the companies in which he and his wife are directors and shareholders. 3.2 The AO after considering the submission of the assessee found....
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....enses in Singapore were made out of the funds in Singapore and that the AO had brought no material on record that Smt. Mona Patel had remitted or diverted income earned in India to meet the expenses in Singapore, the AO had no basis to make the additions of those expenses to the assessed total income merely on the basis of TEP and the surmises that she did not have source of income in Singapore and she had used the undisclosed income in India for those expenses, those substantive additions were deleted. The operating paragraphs from the order for AY 2012-13 in the case of Smt. Mona Patel may be reproduced as under: 7.1 During the A.Y. 2012-13 the AO noted that assessee had taken loan of Rs. 1,46,41,606/- from various companies Impex Link Global Pte Ltd., Global Real Estate Solution Pte Ltd. and Global Impex Link Pte Ltd. in Singapore. It is the case of the AO that the onus was on the assessee to establish the genuineness of these sources of fund and the company had huge debt/liabilities and had no fund of own to lend to the assessee. The AO held that loan amount of Rs. 1,46,51,606/. was not explained and thus the amount was added as unaccounted cash credit in the hand of a....
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....t a request for copy of bank statements was also made since the same was not available with the appellant (as he had already re-located to Japan at that relevant point of time). It was explained and there is no dispute that the transactions in question related to operations in Singapore and the appellant being NRI, no adverse inference can be drawn. It is stated by the appellant that he had furnished the copies of the business activities at Singapore including the Balance sheet and business files of Global Impex Link PTE. Singapore and Global Real Estate Solution PTE as well as the bank book of OCBC i.e. all possible details available with the appellant had been furnished at the assessment stage. These companies have also been identified in the report of Inland Revenue Authority of Singapore. Therefore, the sources of deposits in the bank accounts stood explained and they have not been discredited by the AO. Thus it is apparent that the AO has made additions with respect to the deposits made in the bank accounts operated with OCBC Bank, Singapore which does not fall within his jurisdiction. Further, detailed information has been given which has not been discredited by the AO at any....
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....ndia for the year under consideration and therefore, global income of the assessee is subject tax in India. 7. On the other hand, the learned AR contended that the revenue itself has accepted that the assessee is a non-resident which can be verified from the assessment order available on record. Thus, in the case of non-resident, the income shall be taxable in India if it is accrued or arose in India or deemed to accrue or arise in India. But there was no such finding of the AO arising from the assessment order that income accrued/received or arose in India or deemed to accrue or arise in India. Accordingly, it was submitted by the learned AR that transactions in dispute were carried out in a country outside India which cannot be made subject to tax in India. 7.1 Both the learned DR and the AR before us vehemently supported the order of the authorities below as favourable to them. 8. We have heard the rival contentions of both the parties and perused the materials available on record. From the preceding discussion, we note that the assessee family is living in Singapore where huge expenses were incurred on accommodations and education. Besides, the deposits in bank account....
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....Mona Patel has admitted having incurred impugned expenses out of the loan taken from the companies incorporated in the Singapore in which the assessee and his wife are shareholders and directors. The AO, in the case of Smt. Mona Patel, has not accepted the explanation and added the loan amount to her total income by holding that the companies from which loan claimed to be taken are loss making. On appeal by Smt. Mona Patel to the first appellate authority, the learned CIT(A) accepted the source of the loan amount and deleted the addition on merit of case. Once the substantive addition deleted on merit of the case the consequent addition on protective does not hold ground. In holding, so we draw support and guidance from the judgment of Hon'ble Delhi High Court in case of PCIT vs. Panchmukhi Management Services (P.) Ltd. reported in 153 taxmann.com 297 where it was held as under: "Further, this Court by a separate order in a batch of appeals has upheld the order of the Tribunal deleting the substantive addition on merit made in different concerns of M Group. Consequently, the issue of protective addition in the hand of the respondent-assessee does not arise.[Para 9]" 8.3....
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.... Authority Singapore". The AO also made independent inquiry by referring to Competent Authority of India in Singapore. However, no adverse material resulted from such enquiry for holding the investment made by the assessee was sourced from the income accrued or arose in India. There was no material before us brought by the learned DR contrary to finding of the learned CIT(A). Therefore, considering categorical finding of the learned CIT(A) and the status of the assessee being non- resident the investment made outside India cannot be brought to tax in India for the reasoning discussed above. In view of the above discussion, we hereby confirm the finding of the learned CIT(A). Hence, the grounds of appeals raised by the Revenue are hereby dismissed. 9. In the result, the appeal of the revenue is hereby dismissed. Coming to the ITA No. 170/Ahd/2021, an appeal by the assessee for A.Y. 2012-13 10. The assessee has raised the following grounds of appeal: 1. The Ld. CIT(A) has erred in confirming the action of the Assessing Officer in issuing notice u/s. 148 of Income Tax act, 1961 which is illegal and bad in law hence the assessment so made requires to be quashed. ....
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....disallowed the claim of cost incurred on land leveling for Rs. 34.5 Lakh. 15. The aggrieved assessee preferred an appeal before the learned CIT(A). Before the learned CIT(A), it was contended that the necessary details of the work carried out by the party were furnished before the AO, the payment to party was made through banking channel and acknowledgement of receipt of payment by the party was also furnished. It was further contended that the individual assessee who is not subject to audit under section 44AB of the Act is not required to deduct TDS. The AO rejected the documentary evidence merely for the reason that the payment to contractor was made after execution of sale deed and on the date of payment assessee was not India which is nothing but surmises and presumption of the AO. The AO also did not make any cross verification or inquiry from the party. Accordingly, the assessee prayed to the learned CIT(A) that the disallowance made by the AO should be deleted. 16. The learned CIT(A) after considering the submission of the assessee held that the AO was not justified rejecting the documentary evidence merely on his premises and conjecture. However, the learned CIT(A) co....