G. Narayanan, CHENNAI V. ITO, CHENNAI

ITA 2381/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8026 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 03-10-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 18-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUPRIYO PAL
• Assessee Lawyers: S SUBRAMANIAM

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . !'# ! , % !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.2381/MDS/2016 ( )( / ASSESSMENT YEAR : 2010-11 SHRI G. NARAYANAN, NO.4, NATARAJ, NO.55, THIRD MAIN ROAD, RA PURAM, CHENNAI - 600 028. PAN : ADVPN 7038 B V. THE INCOME TAX OFFICER, NON-CORPORATE WARD 17(5), CHENNAI. (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SHRI S. SUBRAMANIAM, FCA -.+, / 0 / RESPONDENT BY : SHRI SUPRIYO PAL, JCIT 1 / 2% / DATE OF HEARING : 03.10.2016 3') / 2% / DATE OF PRONOUNCEMENT : 25.11.2016 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) 5, CHENN AI, DATED 26.07.2016 AND PERTAINS TO ASSESSMENT YEAR 2010-11. 2. SHRI S. SUBRAMANIAM, THE LD. REPRESENTATIVE FOR THE ASSESSEE, SUBMITTED THAT THE ASSESSEE IS AN EMPLOYE E OF INFOSYS 2 I.T.A. NO.2381/MDS/16 TECHNOLOGIES LIMITED. THE INFOSYS TECHNOLOGIES LIM ITED SENT THE ASSESSEE ON DEPUTATION TO SWITZERLAND FROM 01.03.20 09 TO 19.09.2009. DURING THIS PERIOD, THE ASSESSEE WAS P AID SALARY IN INDIA. HOWEVER, THE MAINTENANCE ALLOWANCE WAS PAID IN SWITZERLAND AND THE TAXES ON MAINTENANCE ALLOWANCE WAS PAID IN SWITZERLAND BY THE EMPLOYER HIMSELF. HOWEVER, THE OTHER STATUTORY DUES WERE PAID BY THE ASSESSEE IN TERMS OF DEPUTATI ON SCHEME. REFERRING TO THE DOUBLE TAXATION AVOIDANCE AGREEMEN T BETWEEN GOVERNMENT OF INDIA AND GOVERNMENT OF SWITZERLAND, THE LD. REPRESENTATIVE SUBMITTED THAT IN RESPECT OF SALARY, THE ASSESSEE WAS LIABLE TO PAY TAX ONLY IN SWITZERLAND AND NOT IN IN DIA. THEREFORE, THE MAINTENANCE ALLOWANCE RECEIVED BY THE ASSESSEE IN S WITZERLAND IS NOT TAXABLE IN INDIA. THE LD. REPRESENTATIVE FURTH ER SUBMITTED THAT EVEN OTHERWISE, THE TAX PAID BY THE ASSESSEE IN SWI TZERLAND HAS TO BE GIVEN CREDIT IN INDIA. 3. SHRI SUPRIYO PAL, THE LD. DEPARTMENTAL REPRESENT ATIVE, SUBMITTED THAT THE ASSESSEE CLAIMED BEFORE THE ASSE SSING OFFICER AS WELL AS THE CIT(APPEALS) THAT MAINTENANCE ALLOWA NCE RECEIVED IN SWITZERLAND WAS EXEMPT UNDER SECTION 10(14)(I) OF T HE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). CERTAIN ALLOWANCES RECEIVED BY THE 3 I.T.A. NO.2381/MDS/16 ASSESSEE WERE EXEMPTION UNDER SECTION 10(14)(I) OF THE ACT TO THE EXTENT TO WHICH IT WAS SPENT. IN THIS CASE, THE AS SESSEE HAS NOT FILED ANY EVIDENCE TO SUPPORT THE EXPENDITURE INCUR RED. THEREFORE, ACCORDING TO THE LD. D.R., THE CIT(APPEALS) HAS RIG HTLY CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICER. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THE ASSESSEE RECEIVED SALARY IN INDIA AND THE ASSESSEE CONTINUED TO BE EMPLOYEE OF INFOSYS TECHNOLOGIES LT D. IN INDIA. THE ASSESSEE WAS SENT ON DEPUTATION TO SWITZERLAND TO EXECUTE WORK OF INFOSYS LIMITED IN SWITZERLAND. THE DOUBLE TAXATION AVOIDANCE AGREEMENT BETWEEN GOVERNMENT OF INDIA AND GOVERNMENT OF SWITZERLAND, MORE PARTICULARLY ARTICL E 15, SAYS THAT SALARIES, WAGES AND OTHER SIMILAR REMUNERATION DERI VED BY A RESIDENT OF A CONTRACTING STATE IN RESPECT OF AN EM PLOYMENT SHALL BE TAXABLE ONLY IN THAT STATE UNLESS THE EMPLOYMENT IS EXERCISED IN THE OTHER CONTRACTING STATE. THIS PROVISION OF DOUBLE TAXATION AVOIDANCE AGREEMENT WAS NOT CONSIDERED BY BOTH THE AUTHORITIES BELOW. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDER ED OPINION THAT THE MATTER NEEDS TO BE RECONSIDERED BY THE ASSESSING OF FICER. 4 I.T.A. NO.2381/MDS/16 ACCORDINGLY, THE ORDERS OF THE AUTHORITIES BELOW AR E SET ASIDE AND THE ENTIRE ISSUE IS REMITTED BACK TO THE FILE OF TH E ASSESSING OFFICER. THE ASSESSING OFFICER SHALL RECONSIDER THE ISSUE IN THE LIGHT OF THE PROVISIONS OF DOUBLE TAXATION AVOIDANCE AGREEMENT B ETWEEN GOVERNMENT OF INDIA AND GOVERNMENT OF SWITZERLAND A ND THEREAFTER DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW, AFT ER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 25 TH NOVEMBER, 2016 AT CHENNAI. SD/- SD/- (. !'# ! ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 25 TH NOVEMBER, 2016. KRI. / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A) 5, CHENNAI-34 4. PRINCIPAL CIT-9, CHENNAI 5. 7: -2 /DR 6. ;( < /GF.