TMI Blog2021 (4) TMI 951X X X X Extracts X X X X X X X X Extracts X X X X ..... had considered similar issue held 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 establish es 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. For the above-mentioned reasons, hereby direct the Ld.AO to delete the tax imposed on the assessee with respect to his salary income of ₹ 12,90,846/- and the foreign allowances Thus , the appeal of the assessee is allowed. The Assessing Officer is directed to allow exemption under DTAA. - ITA No.55/Hyd/202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tificate to claim the relief under section 90 for the salary received outside India with respect to the services rendered outside India, b) Reconciliation of salary income received by the assessee in India and in United Kingdom along with documentary evidence, c) Copy of bank account of Austria to verify the receipts in abroad or any other documentary evidence for any other mode of payment in abroad. d) Copy of Assignment letter between Employer and employee. 2.1 In response, the assessee submitted a reply dated 9.9.2016 given as under: As the assessee has spent less than 60 days in India during the FY 201314, he qualifies as a Non resident under section 6(1) of the Act. Therefore, the foreign allowance of ₹ 19, 79, 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the return of income filed by him. We shall not be able to produce Austrian TRC as issuance of the same is dependent on the Austria tax authorities. 2.2 The Assessing Officer, however, held that the claim of the assessee could not be allowed for the following reasons: I. The assessee could not produce the Tax Residency Certificate of Austria for claiming the Double Taxation relief under section 90 as it is statute U/S 90(4) of the Income tax Act, 1961 w.e.f. from A.Y. 2013-14. The assessee has failed to furnish the supporting evidences for receiving the foreign allowances outside India to come under purview of section 5(2) of the Income tax Act, 1961. Moreover, the assessee has neither produced any bank account outside India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the Orders of the Ld. Revenue Authorities , I find that the Ld. AO has disallowed the exemption claimed by the assessee under Article 15(1) of the India-Austria DTAA only for want of Tax Residence Certificate (TRC) from Austria. The submission of the assessee in this regard was that despite best possible efforts he was not able to procure TRC from country of residence and the situation may be treated as impossibility of performance . I find merits in the submission of the assessee. Normally it is a herculean task to obtain certificates from alien countries for compliance of domestic statutory obligations. In such circumstances the taxpayer cannot be obligated to do impossible task and penalized for the same. If the assessee provides ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e..... . 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 reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AA with UK. Hence, the salary received by the assessee was not taxable in India in pursuance of DTAA between India and UK. 16. In the case of DIT Vs. Prahlad Vijendra Rao (239 CTR 107), on which reliance placed by the assessee, the Hon'ble Karnataka High Court 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. 17. The other objections raised by the Ld. AO that evidence was not produced for receiving the foreign allowance outside India and the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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