TMI Blog2012 (4) TMI 205X X X X Extracts X X X X X X X X Extracts X X X X ..... dent" and the real status of the assessee cannot be denied merely the assessee made a wrong declaration when he satisfied all the conditions - is entitled to the benefit of Section 115 E - TAX CASE (A) NOS.1053 TO 1056 OF 2004 - - - Dated:- 7-2-2012 - D.MURUGESAN AND P.P.S.JANARTHANA RAJA, JJ. JUDGMENT D. Murugesan, J. The above Tax Case appeals have been preferred by the Revenue under Section 260-A of the Income Tax Act against the order dated 29.12.2003 passed by the Income Tax Appellate Tribunal, Chennai "A" Bench, in I.T.A.Nos.1379/Mds/2003 to 1382/Mds/2003 respectively, raising the following substantial questions of law:- "1. Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the assessments for the assessment years 1994-95 to 1996-97 have not been validly re-opened? 2. Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in holding that notices under section 143(2) were not issued within twelve months from the end of the month in which the return was filed in response to the notice under section 148, which finding is contrary to facts on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /115 H of the Income Tax Act, 1961. The same was processed under Section 143(1)(a) of the Act. Later, the Assessing Officer reopened the assessment on the ground that there is escapement of income tax. Therefore, on reopening the assessment under Section 147 of the Act, the assessing officer denied the exemption. Aggrieved by that order, the assessee filed appeal before the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) held that reopening is valid and accordingly, denied the benefit of tax payment at 20%. Aggrieved by that order, the assessee filed appeal before the Income Tax Appellate Tribunal. The Tribunal held that the Assessing Officer was not justified in reopening the assessment and considered the case on merits and allowed the case of the assessee. Aggrieved by that order, the Revenue has filed the present Tax Case Appeals raising the above questions of law. 4. The learned counsel appearing for the Revenue contended that the Tribunal was wrong in holding that there is no valid reason for reopening of the assessment and the same was bad in law. He further contended that the Tribunal ought to have seen that the assessee is a "Resident" and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondent/assessee had been a 'Non-Resident" for 12 years prior to his return to India. He has been in India only for 323 days during the previous seven years preceding the assessment year 1993-94. Therefore, the Tribunal was of the view that the respondent/assessee falls within the scope of Section 6(6)(a) of the Income Tax Act, 1961. So, the Tribunal held that the status of the assessee is "Not Ordinarily Resident". It is pertinent to note that the assessee in his original return declared his status as "Resident". Therefore, the Assessing Officer denied the benefit. The real status of the assessee cannot be denied merely the assessee made a wrong declaration when he satisfied all the conditions. Therefore, the Tribunal, applying the scope of the provisions of Section 6(6)(a) of the Act, given a categorical finding that the status of the assessee is "Not Ordinarily Resident" during the relevant assessment year and also upto the assessment year 2001-02. Because of the status of the assessee is 'Not ordinarily resident' during the year, the assessee is entitled to the benefit of Section 115 E of the Income Tax Act, 1961. In the present cases, the entire deposit held by the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal applied the above definition and has come to the conclusion that the assessee status is only "Not Ordinarily Resident". Therefore, the Tribunal held that the assessee is not a resident and entitled to the benefit of Section 115 E of the Act. In this case, there is no dispute regarding the interest earned on the various deposits in the Bank, which is specified under Section 115 E of the Act and the assessee is subject to 20% of taxation. So, the argument of the Revenue that requirement of filing of the declaration does not arise since that is not the condition for getting the benefit. Therefore, the Tribunal correctly held that the assessee had no obligation to file any declaration under Section 115 H or 115 E of the Act. Therefore, the Tribunal had correctly held that the assessee was not obligated to file any such declaration until the assessment year 2002-03. In respect of the nature of investment, the Tribunal also held in detail in paragraph 28 and has come to a conclusion that the subsequent redesignation of the NRE accounts into NRNR accounts have been made only from out of the convertible Foreign Exchange lying to the credit of the assessee in his various accounts whi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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