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2015 (9) TMI 273 - ITAT JAIPURNotice issued under section 143(2) by the ACIT Circle-2 Udaipur challenged - Held that:- The assessee as per section 124(3) had not challenged the jurisdiction before the AO within one month from the date on which he was served notice under section 143(2) of the IT Act as he challenged the jurisdiction of the ADIT (Intl. Taxation), Jaipur on 12.10.2010 whereas first notice under section 143(2) was issued on 22nd September, 2009. Further, even the objection regarding jurisdiction was raised before the AO which can be entertained by the Commissioner or Chief Commissioner from the date of Notification i.e. 1st September, 2008 as per section 124(2) of the IT Act. The case law cited by the assessee are not squarely applicable. The assessee’s status was non-resident but he filed the return before the ACIT Circle-2 Udaipur, PAN was lying with him as is evident from the processing made by the ACIT, Circle-2, Udaipur on 25.06.2009. The jurisdiction of nonresident was decided by the Addl. Director of Income-tax (International Taxation), Jaipur as per direction of the CBDT issued for non-resident assessee. Therefore, there is no need to pass order under section 127 of the IT Act as Additional DIT (International Taxation) Jaipur had passed the order in pursuance of direction of CBDT. The case laws referred by the assessee are not squarely applicable to the facts of this case. The ld. A/R had not controverted the findings given by ld. CIT (A). Therefore, we confirm the order of the ld. CIT (A). - Decided against assessee. Treatment to the over all income of the assessee as belonging to his wife, received in UK which was only remitted to India and clubbing these receipts in the hands of the assessee under section 64 - Held that:- As per Explanation-1, income accruing or arising outside India shall not be deemed to be received in India within the meaning of this section by reason only of the fact that it is taken into account in a balance sheet prepared in India. Therefore, it is clear from section that in case of assessee non-resident and income accrues or arises outside India shall not be included in the income of the assessee. The shares were held by the assessee. The employer company issued these shares on the basis of Scheme and performance of the assessee. There was a restriction on this Award which proved that these shares were allotted to the assessee but on request same were issued in the name of his wife Smt. Sunita Pathak. It is further held that section 64 is also not applicable on this transaction because assessee is a non-resident and even if it is presumed that these shares were transferred without any consideration to the wife of the assessee who is non-resident being a capital asset not taxable in India on account of status of the assessee. Therefore, same cannot be clubbed in the hands of the assessee as capital asset/capital gain arises/accrued outside India. Further, the case laws relied upon by the assessee are squarely applicable as real owner of the shares was assessee, not his wife. Therefore, same should be taxed in the hands of non-resident assessee but as per section 5(2), this income accrued or arise outside India. Thus there is no tax in the case of the assessee. We are of the considered view that the ld. CIT (A) was not right in upholding the share transaction as taxable in the hands of the assessee. Accordingly we reverse the order of ld. CIT (A). - Decided in favour of assessee.
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