TaxTMI 
TaxTMI 
2024 (6) TMI 815
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....ort), dated 23-12-2022 in the matter of an assessment framed by Ld. Assessing Officer [AO] under Section 143(3) r.w. Section 144C(13) of the Income Tax Act, 1961 ('the Act' in short) on 29-12-2017. 02. The grounds taken by the assessee namely 'Nanthakumar Murugesan' in IT(TP)A No.12/Chny/2023, read as under: ''1. The learned AO has in pursuance of the Directions of the Hon'ble DRP erred in the facts and circumstances of the case and in law in issuing the impugned order dated 23 December 2022 issued under Section 143(3) read with Section 144C(13) of the Act against the Appellant for AY 2020-21 disallowing the exemption of INR 1,22,09,830 claimed under Article 15(1) of India- China Double Taxation Avoidance Agreement ('DTAA') read with Section 90 of the Act in respect of the salary income received in India for services rendered in China to BMW Brilliance Automotive Limited (BMW China) in ignorance of the facts, statutory provisions, documentary evidence and judicial precedents cited. 2. The learned AO has in pursuance of the Directions of the Hon'ble DRP erred in the facts and circumstances of the case and in law in disallowing the exemption claim....
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....e decisions of Hon'ble ITAT "C" bench, Chennai, vide its judgment in ITA No.298/Mds/2016 in the case of Shri Dennis Victor Rozaria and ignoring the recent favourable decision dated 28 February 2020 of the Chennai Tribunal in the case of Paul Xavier Samy (ITA 2233/Chny/2018) on identical issue. 7. The learned AO has in the facts and circumstances of the case and in the law erred in seeking to initiate penalty proceedings under section 270A of the Act for under-reporting of income. Any consequential relief, to which the Appellant may be entitled under the law in pursuance of the aforesaid grounds of appeal, or otherwise, may be thus granted. The Appellant may kindly be given an opportunity of being heard as per the principles of natural justice''. 03. The grounds taken by the assessee 'Sivakarthick Raman' in IT(TP)A No.13/Chny/2023 read as under: '1. The learned AO has in pursuance of the Directions of the Hon'ble DRP erred in the facts and circumstances of the case and in law in issuing the impugned order dated 21 December 2022 issued under Section 143(3) read with Section 144C(13) of the Act against the Appellant for AY 2020-21 disallowing the ....
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....luded that no tax was paid in China contrary to evidence filed i.e China tax returns 3. The learned AO has in the facts and circumstances of the case and in law erred in holding that the tax residency certificate was not filed by the Appellant while ignoring that the China Tax Return was alternate and sufficient evidence of Residency in China. 4. Without prejudice, the learned AO has in the facts and circumstances of the case and in law erred in ignoring that salary received in India by the Appellant is not taxable in India under Section 5(2) read with Section 9(1)(ii) and Section 15(1)(a) of the Act as the services have been rendered to BMW China in China by the Appellant. 5. The learned AO has in the facts and circumstances of the case and in law erred in levying interest under Section 234B of the Act amounting to INR 4,092. Any consequential relief, to which the Appellant may be entitled under the law in pursuance of the aforesaid grounds of appeal, or otherwise, may be thus granted. The Appellant may kindly be given an opportunity of being heard as per the principles of natural justice. All of the above grounds of appeal are without ....
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....icle 15(1) of DTAA between India and China. 7.1 The assessee filed return of income on 24.11.2020 admitting income of Rs. 1,85,353/. The assessee in return of income for AY 2020-21 claimed salary of Rs. 1,22,09,830/- as reflected in Form 16, 26AS related to period 01.04.2019 till 31.03.2020 and claimed exemption under Article 15(1). The assessee claimed refund of Rs. 41,72,850/- arising out of excess TDS in comparison to tax. However, Ld. AO treated the gross salary received by assessee in India of Rs. 1,22,09,830/- from 'BMW-India' as taxable in India and held that the assessee is not eligible for exemption under the provisions of Article 15 of DTAA between India and China being non-resident in India. 7.2 It transpired that the assessee was employed with 'BMW-India'. He was sent to China on International assignment to 'BMW China' by the employer company 'BMW-India'. The salary continued to be paid in India by the employer 'BMW-India'. The assessee submitted before AO that assessee being tax resident of China, the salary income was taxable in China only and the same has been offered to tax in China. It was further contended before AO that assessee being non-resident, the sala....
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....dia for 63 days during this year and his status, as per law, is non-resident. The assessee has worked in India for 21 days and offered proportionate salary to that extent to tax. For remaining period, the work has been performed in UK 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 bench of Chennai Tribunal in Shri Paul Xavier Antonysamy V/s ITO (ITA No.2233/Chny/2018 dated 28.02.2020). In this decision, the bench has held that the provisions of Sec.5(2) are subjected to other provis....
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....is of the above, it could be seen that separate tax payment has been made by OFSSL to UK revenue authorities to discharge the tax liability of the assessee in that country. 8. The assessee has also placed on record Tax Residency Certificate (Page nos. 192-193 of paper book). As per this certificate, the assessee has claimed relief for foreign earning not taxable in UK for GBP7952. The same shall be considered by Ld. AO while computing the quantum of income taxable in India as directed by us in preceding para-7. 9. The appeal stands partly allowed in terms of our above order." In the above decision, we have held that salary income as accrued to the assessee for work performed in a foreign jurisdiction would not be taxable in India whereas the salary received for work performed in India would be taxable in India. The benefit of DTAA would be available to the assessee as per the decision of coordinate bench of Chennai Tribunal in Shri Paul Xavier Antonysamy V/s ITO (ITA No.2233/Chny/2018 dated 28.02.2020) wherein it was held by the bench that the provisions of Sec.5(2) are subjected to other provisions of the Act. The regular salary accrued to any assessee i....