TMI Blog1996 (2) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... e status of non-resident. It was also claimed on behalf of the assessee that interest income in respect of the amount lying on the non-resident external account of an non-resident Indian was exempt from tax under section 10(4A). 2.1 The Assessing Officer observed that the assessee was admittedly in India for 48 days and was also maintaining a dwelling place in India known as ' Alankar Building '. The residential status of the assessee will therefore be that of " resident but not ordinarily resident, (NOR). The provisions of section 10(4A) of IT Act in the relevant year, namely, 1981-82 provided for grant of exemption in respect of interest on NRE A/c. only in the case on Non-resident (NR) and such an exemption was not available to NOR. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntitled to grant of exemption under section 10(4A). He also placed reliance on judgments reported in Orissa Weavers Co-operative Spinning Mills Ltd. v. CIT [1991] 187 ITR 646 (Ori.) and Govinddas v. ITO [1976] 103 ITR 123 (SC) to support his contention that the amendment made with effect from 1-4-1982 (applicable from assessment year 1982-83) cannot be made effective with retrospective effect. He, therefore, submitted that the view taken by the Assessing Officer should be confirmed and the order of the Dy. CIT (Appeals) should be set-aside. 5. The learned counsel for the assessee submitted that the decision of ITAT, Jaipur Bench in the case of D.M. Bohra squarely supports the assessee's case. The amendment made in section 10(4A) is merel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on moneys standing to their credit in a ' non-residents account ' in any bank in India in accordance with the Foreign Exchange Regulation Act, 1947 and rules made thereunder. 7.1 The Finance Act, 1968 amended and altered the exemption originally granted with effect from 1-4-1969. The effect of this amendment was explained in Board's Circular dated 6-7-1968. It was explained that the intention underlying this provision was to provide the exemption in respect of interest only on funds which are repatriable outside India. In order to bring out this intention, section 10(4A) of the IT Act was amended by the Finance Act, 1968. Under the amended provision, the exemption will be available only in respect of interest on moneys standing to the cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt clause (4A) by a new clause to provide that exemption from income-tax in respect of interest on non-resident (external) account shall be available in the case of a ' person resident outside India ' as defined in section 2(q) of the Foreign Exchange Regulation Act, 1973." 7.3 It is clear from the aforesaid Circular that this amendment was made with a view to removing this anomaly by which it was provided that exemption from income-tax in respect of interest on non-resident (external) account shall be available in the case of a ' person resident outside in India ' as defined in section 2(q) of the Foreign Exchange Regulation Act, 1973. The amendment so made with the object of removing the existing anomaly should be held to be clarificato ..... X X X X Extracts X X X X X X X X Extracts X X X X
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