TMI Blog2010 (9) TMI 160X X X X Extracts X X X X X X X X Extracts X X X X ..... BLE THE CHIEF JUSTICE HON'BLE MR. JUSTICE MANMOHAN Ms. Rashmi Chopra, Advocate Ms. Rashmi Chopra, Advocate MANMOHAN, J: 1. The present appeals have been filed under Section 260A of the Income Tax Act,1961 (hereinafter referred to as "Act") challenging the common order dated 30th June, 2009 passed by the Income Tax Appellate Tribunal (in short "Tribunal") in ITAs No. 2106 and 2107/Del/2008 for the Assessment Years 1998-1999 and 1999-2000. 2. The brief facts of the two cases are that the Assessing Officer (in short, "AO") during the course of assessment proceedings noticed that the respondent-assessee had not offered his income from abroad for the purposes of taxation for the assessment years 1998-1999 and 1999-2000. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on is (a) an individual who has not been resident in India in nine out of the ten previous years preceding that year, or has not during the seven previous years preceding that year been in India for a period of, or periods amounting in all to, seven hundred and thirty days or more; or (b) a Hindu Undivided family whose manager has not been resident in India in nine out of the ten previous years preceding that year, or has not during the seven previous years preceding that year been in India for a period of, or periods amounting in all to, seven hundred and thirty days or more" "Section 6(6) (Post-amendment): A person is said to "not ordinarily resident" in India in any previous year if such person is (a) an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o 730 days or more during the seven years preceding that year. (2) An individual, though resident, is not ordinarily resident; in any previous year- (a) Either where he has not been resident, ie., has been a non-resident in nine out of ten previous years preceding that previous year; (b) Or where he has not been in India (ie., has been absent from India) for 730 days or more during the seven previous years preceding that year. It will be seen that, if we apply the first of the above two interpretations, the applicant will be resident but not ordinarily resident for the assessment years 1996-97 to 2004-05 as he will have been a "resident" in eight and less number of preceding previous years although his physical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous years and that he will be treated as resident but not ordinarily resident if either of these conditions is not fulfilled. The applicant is therefore, right when he says that he will be having the status of a resident but not ordinarily resident for the assessment years 1996-97 to 2004-05. It is on this assumption that his questions have to be answered and the answers are restricted to the assessment years in respect of which he will be a resident but not ordinarily resident mentioned above."(emphasis supplied) 8. The above section was amended by the Finance, Act 2003, w.e.f 1st April , 2004. After the amendment, the first interpretation as given above by Authority for Advance Ruling has made way for the second interpretation in determ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t be said that it is clarificatory in nature. The scope of total income of an assessee is decided with reference to residential status. Consequently, the tax effect of the assessee's total income is decided with reference to the residential status. By virtue of this section the assessee acquired a vested right in the form of reduced total income. In regard to statutes dealing with substantive rights, I may refer to the decision of the Hon'ble Supreme Court in the case of Keshavan Madhava Menon vs. State of Bombay, AIR 1951 SC 128 wherein it has been held that a cardinal principle of construction of statutes is that every statute is prima facie prospective operation. This rule is applicable where the object of the statute is to affect vest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egislation. Courts are not to take into consideration the consequences that would follow. Courts are not to fill in the gaps in legislation. A matter which should have been, but has not been provided for in a statute cannot be supplied by courts, as to do so will be legislation and not construction. In the present case not mentioning of non resident in Section 6(6)(a) is a case of casus omissus which has been corrected by Finance Act, 2003. I may further observe that aid to Notes on clauses can be had only in case of some ambiguity in the section and not otherwise." xxxx xxxx xxxx xxxx 6. We have heard the rival contentions and perused the material on record. As the facts emerge, it has not been disputed that prior to 1.4.2004, there e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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