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2023 (5) TMI 209 - AT - Income TaxRectification of mistake u/s 154 - Income chargeable to tax in India - period of stay in India - entire income of the appellant accrued, earned and received outside India (i.e., Kenya) - whether appellant being a non-resident as per section 5 of the Act, is not liable to pay tax on income earned outside India? - Whether CIT (A) and Ld. AO has erred in not appreciating the undisputed fact that the Appellant was not required to pay taxes in India, and the income disclosed by the Appellant was clearly a mistake visible on the record, making it eligible for rectification? - Failure to file revised return - AO dismissed the rectification application filed by the assessee on ground that the assessee has not disputed that the adjustment made u/s 143(1) HELD THAT:- The Bench noted it would be two technical for non-resident Indian to go into the intricacy of Indian income tax once the assessee has fairly moved an application u/s 154 of the Act. The ld. AO should have guided the non-resident and have passed the order on merits. CIT(A) has dismissed the appeal of the assessee only on the reason that the scope of section 154 of the Act is very limited and have not entertained the appeal of the assessee on merits considering the oral all fact and peculiarity of the case. Considering the specific facts on record that the assessee is non resident the amount which the ld. AO has taxed is earned and sourced outside India does not confer the income tax on the said income which does not accrue or arise in India and levy of income tax on such income is does not arise. It is the duty of the ld. AO to guide the assessee who are complying voluntarily based on the email addressed to him and it should not be intention the ld. AO to tax the income which is not chargeable to tax in India. Since, we have considered the arguments of the ld. DR that the issue on merits that whether the income shown on head salary is in fact received outside India is not decided under the order in dispute before us i.e. u/s 154 of the Act. We direct the ld. AO to call for the details of the salary from the assessee and determined the fact as to whether considering the facts and circumstances of the case and salary income is chargeable to tax into or not. At the same time assessee is directed to place all the relevant material to decide about the taxability or otherwise of the income that he has earned. In terms of these observations, the appeal of the assessee is allowed for statistical purpose.
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