Income Tax Appellate Tribunal (ITAT) recently allowed non -resident Indian (NRI) vto rectify Income Tax Return after seven years as tax benefit was not claimed by mistake.
P.R.Mohanty who had appeared for the assessee and Charan Dass who had appeared for revenue.
Assessee Prasanta Kumar Mishra, who was deriving income from salary rendering services outside India in UAE. M/s. D.M.Associates, a Chartered Accountant Firm at Bhubaneswar was the authorized representative of the assessee and when they filing the return of income on behalf of the assessee mistakenly did not claimed the non resident exemption under section 5 (1) (c) read with section 6 of the Income Tax Act 1961.after the scrutiny assessment as per section 143(1) of Income Tax Act 1961. the assessee came to know the mistake then filed a rectification petition after the delay of seven years. Assessing officer rejected the petition by reason of time bar. Against this assessee filed an appeal before ITAT.
Assessee representatives submitted that the Central Board of Direct Tax (CBDT) on their circular issued on 20.6.2012 directed that if the claim was genuine the issue could be decided on merits beyond four years.
Counsel for revenue submits that the issue could not be decided in favor of the assessee without going into the merits and also mention that as per the circular issued by the CBDT the period of limitation was four years but it was beyond four years.
After considering contentions of the both side the ITAT bench allowed the appeal filed by the assessee and held that the “Assessing Officer is at liberty to examine whether the assessee was NRI during the relevant point of time and whether he is entitled to the benefit of exemption under section 5 (1) (c) read with section 6 of the Income Tax Act 1961”.
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