TMI Blog2020 (4) TMI 226X X X X Extracts X X X X X X X X Extracts X X X X ..... and the salary income received by him in India for employment exercised in UK has been offered by him for taxation in UK in pursuance of Article 16 of DTAA with UK. Hence, the salary received by the assessee was not taxable in India in pursuance of DTAA between India and UK. In the case of DIT Vs. Prahlad Vijendra Rao [ 2010 (11) TMI 803 - KARNATAKA HIGH COURT] on which reliance placed by the assessee, held that under section 15 of the Act even on accrual basis salary income is taxable i.e. it becomes taxable irrespective of the fact whether it is actually received or not; only when services are rendered in India it becomes taxable by implication. However, if services are rendered outside India such income would not be taxable in India. Other objections raised by the Ld. AO that evidence was not produced for receiving the foreign allowance outside India and the bank account of the assessee maintained abroad was not produced is not relevant because the facts of the case establishes that the salary and the foreign allowance was received in India for the services rendered abroad and by virtue of DTAA and the Act, there is no bar in law for receiving the money in India. Here ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account of Austria to verify the receipts in abroad or any other documentary evidences for any other mode of payment in abroad. d) Copy of Assignment letter between Employer and employee. 6. In response, the Ld.AR submitted his reply vide his letter on 09.09.2016 which is reproduced here as under for reference: As the assessee has spent less than 60 days in India during the FY 2013-14. he qualifies as a Non-resident under section 6(1) of the Act. Therefore, the foreign allowance of ₹ 26,93,062/- was not offered to tax in India in the return of income as the same was received by him outside India for the services rendered outside India and shall not form part of total income under section 5(2) of the Income tax Act, 1961. Also, as the assessee qualifies as a tax resident of Austria, exemption under Article 15(1) of the India- Austria Double taxation Avoidance Agreement (DTAA) has been claimed in the return of income for the employment income. Based on the above, any salary income earned by a tax resident of Austria for services rendered in Austria is taxable only in Austria. In case services have been rendered in India the income for workdays spent in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e order of Ld. AO, the assessee preferred an appeal before the CIT(A). However, the Ld. CIT (A) dismissed the appeal of the assessee by agreeing with the view of the Ld. AO. Hence the assessee is in appeal before the Tribunal. 9. The ld. AR of the assessee submitted before me that the assessee had been taxed in Austria in respect of the salary income and allowances paid to him by IBM on account of employment rendered in Austria. It was further submitted that the entire salary income of the assessee has been taxed in India as well and taxes at source have been deducted u/s 192(1) of the Act, which has resulted in double taxation. It was therefore clarified that since there is an incidence of double taxation on the same income the assessee had claimed exemption u/s 90 of the Act read with Article 15(1) of the India-Austria DTAA in respect of the doubly taxed income which is appropriate. 10. The ld. AR further argued that since the assessee qualifies as tax resident of Austria for the period April 01, 2013 to March 31, 2014, the salary income amounting to INR 36,63,763/- earned for the said period has been claimed as not taxable in India as per the provisions of Article 15(1) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Secro BPO (P.) Ltd vs. Authority for Advance Ruling reported in 379 ITR 256 had held that Whatever may have been the intention of the lawmakers and whatever the words employed in Section 90(4) may prima facie suggest, the ground reality is that as the things stand now, this provision cannot be construed as a limitation to the superiority of treaty over the domestic law. It can only be pressed into service as a provision beneficial to the assessee .. . Therefore, the stand of the Ld. Revenue Authorities on this issue is devoid of merits. 12. As per Article 15(1) of the India-Austria DTAA, salaries, wages and other similar remuneration derived by a resident of a contracting state in respect of an employment shall be taxable only in that state unless the employment is exercised in the other contracting state. If the employment is so exercised, such remuneration as is derived therefore may be taxed in that other state. Further, Article 4(1) the India-Austria DTAA defines the term resident as under: For the purposes of this convention, the term resident of a contracting state means any person who, under the laws of that state, is liable to tax therein by reason of h ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
