2023 (8) TMI 1493

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....nt allowance received by the assessee for the services rendered outside India could be taxed in India? 2. Brief facts are that the assessee is an employee of IBM India Private Limited, which is an Indian company. The said company sent the assessee on long term assignment to Abu Dhabi, UAE. During the year, the assessee received salary which includes the component of the foreign allowance received outside India. The employee transferred the foreign assignment allowance from the bank accounts held in India to the nostro accounts to top it up to the Travel Currency Card (TCC), which the assessee can use only abroad, but not in India, and it is a foreign currency denominated account. Assessee offered such portion of the salary which was receiv....

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....that TDS made by the employer is the primary evidence to show that the situs of employment is in India and the entire salary is accrued to the assessee in India. Learned CIT (A) accordingly dismissed the appeals preferred by the assessee. 5. Assessee is, therefore, aggrieved and filed this appeal contending that it is incorrect to say that the foreign assignment allowance for the services rendered outside India and received outside India to be taxed in India. The assessee is being a non-resident would not be liable to tax under the Act as the foreign assignment allowance was not received nor accrued nor deemed to be received/accrued in India during the year for services rendered in India. 6. Learned AR submitted that this issue is no long....

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....d governed by the parent company in India and also because the parent company deducted TDS on the entire remuneration received by the assessee, this conclusively proves that the situs of employment is in India. According to him, merely because the assessee was directed to perform duties on foreign soil for a temporary period of time, it does not take away the right of the Revenue to collect tax on such amount, which was accrued/received by the assessee in India. According to him, the reasoning given by the learned Assessing Officer to come to the conclusion that all through this period, the situs of employment is in India is impeccable and does not require any interference. 8. Further contention of the learned DR is that the income was rec....

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....tva Chattopadhyay vs. CIT (supra), Sri Ranjit Kumar Vuppu vs. ITO (supra), DCIT vs. Sudipta Maity (supra), Sri Srinivas Mahesh Laxman vs. ITO (supra), Shri Venkata Rama Rao vs. ITO (supra) and Shri Tadimarri Prasanth and others (supra). 10. While reaching the conclusion that such an amount of foreign assignment allowance received for the services rendered outside India by way of TCC abroad is not taxable in India, reliance was placed by the co-ordinate Benches of the Tribunal on the decisions of CIT vs. Avtar Singh Wadhwan (supra), DIT vs. Prahlad Vijendra Rao (supra) and Utanka Roy vs. DIT (supra). In the case of Bodhisattva Chattopadhyay vs. CIT (supra), the facts are identical. In that case also the assessee was found to be a nonresiden....