TMI Blog2014 (2) TMI 901X X X X Extracts X X X X X X X X Extracts X X X X ..... ies are not necessarily indicators of a visit - When the applicant resigns from her employment in China, the reason for return to India does not seem to be only for a visit – the contention that the applicant came to India only for a visit cannot be accepted – thus, Explanation (b) to section 6(1)(c) of the Act is also not applicable - the applicant's case does not fall under Explanation (a) or (b) to section 6(1)(c) of the Act and having fulfilled the requirements of section 6(1)(c) of the Act her status will be resident in India - the amount of proceeds received in India on conversion of ESOPs and RSUs awarded to her by her employer in China will be taxable in India – Decided against Assessee. - A.A.R. No. 1091 of 2011 - - - Dated:- 19-2-2014 - DR. ARIJIT PASAYAT AND T.B.C. ROZARA, JJ. For the Appellant : Ajay Vohra, Vishal Kalra and Anshul Sachar. For the Respondent : Rajeev P. Singh and Vikram S. Sharma. RULING The applicant Mrs.Smita Anand is an Indian citizen and a person of Indian origin. She was working with Hewitt Associates(India) Private Limited from April, 2002 till September, 2007. On September 22, 2007, the applicant left India for the purpose of e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lt of global merger of Hewitt with AON Corporation. 4. The application was admitted under section 245R(2) and while admitting the application the Authority left the question as to whether the applicant is a resident or a non-resident, to be considered while deciding the application under section 245R(4). 5. It was submitted that the applicant's stay in India for the financial year 2010-11 being less than 182 days and the applicant being on employment in China, her status continues to be non-resident during the financial year 2010-11 in terms of Explanation (a) to section 6 of the Income-tax Act, 1961(hereinafter referred to as the Act). The applicant has not returned to India with the intention to permanently stay or settle in India but on a visit to meet her family and friends. The residential house property owned by the applicant (jointly with her husband) has been let out till June,2011 and if the applicant's intention would have been to primarily reside in India, the applicant would have requested the tenants of such property to vacate the premises, close to the period of arrival to India. The applicant has been travelling to different locations for holiday and to meet with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tuted to 182 days. However, if in the previous year, the assessee has come to India permanently after leaving his employment outside India, then the Explanation (b) will not be applicable." 8. We have considered the rival contentions of the applicant and the Revenue. Though the question relates to taxability of the amount of proceeds received in India on conversion of ESOPs RSUs granted to the applicant during her employment in Hewitt China, the main issue is the residential status of the applicant as taxability of the receipt depends on the residential status of the applicant during the financial year 2010-11. The arguments of both the applicant and the Revenue are based on the provisions of section 6(1) of the Act which is reproduced as under:- Residence in India. Section 6. For the purposes of this Act,- (1) An individual is said to be resident in India in any previous year, if he- (a) is in India in that year for a period or periods amounting in all to one hundred and eighty-two days or more; or (b) .. (c) having within the four years preceding that year been in India for a period or periods amounting in all to three hundr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Non resident Stay in India during FY 2010-11 less than 182 days under Explanation (b) to section 6(1) of the Act It is seen from the tabulation that the total stay in India of the applicant for the preceding four years is 407 days which is more than 365 days. However, the total stay during the relevant assessment year 2011-12 is 119 days. Submission of the applicant is that in terms of Explanation (a) and/or (b) to section 6(1) of the Act, the period of stay in India should be 182 days or more and the applicant's total stay in India during the period is 119 days and therefore, her residential status is non-resident during the relevant previous year. The Revenue's contention is that Explanation (a) or (b) to section 6(1) of the Act is not applicable in the applicant's case and her total stay in India during the previous year being more than sixty days, the applicant's status is resident in India and the amount received during the previous year from any source is taxable in India. 10. We are of the view that Explanation (a) to section 6(1)(c) is applicable only in a particular year when a person leaves India. In the context of the application and the arguments made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unsel for the applicant argued that was so and the Revenue submitted that she did not come to India only for a visit as her return to India is after resigning from her employment in China. The facts and circumstances of the case make us to believe that the applicant did not come to India only for a visit. The learned counsel's argument that the applicant's employer card was valid upto 31.3.2012, the applicant was considerably exploring possibility of job outside India, the residential house property owned by the applicant jointly with her husband had been let out till June, 2011, the applicant visited her friends and relatives in different parts of India and also travelled different locations on holidays, the children of the applicant were staying abroad at the time when applicant came to India etc., are not sufficient to conclude that the applicant came to India on a visit only. The applicant could very well resign even during the validity period of the employer's card and that is what she has done. The activities mentioned by the learned counsel need not be necessarily proof of a visit, even a person staying permanently in India also does those activities. If a person returns to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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