Tribunal held that the AO having brought no material on record which can reasonably establish that the credit amount standing in the foreign bank account of the non-resident assessee represents income which has accreted or arisen in India or deemed to accrue or arise in India and there being no direct evidence of any business activity of the assessee in India, there is no justifiable basis for bringing to tax the amount standing credit in the name of the non-resident assessee in the foreign bank account; merely having a property in India or for that matter, an address in India is too simplistic a basis to hold that deposits placed outside India can be brought to tax. Addition was deleted. (AY. 2006-07 & 2007-08)
Pratab Gulabrai Tulsiani & ORS. v. ACIT (IT) (2025) 237 TTJ 388 / 177 taxmann.com 151 (Mum)(Trib)
S. 9(1)(i) : Income deemed to accrue or arise in India-Business connection-Non-resident-Accrual of income-Credit amount standing in foreign bank account of non-resident assessee-Bank accounts with HSBC, Geneva-Merely having a property in India or for that matter, an address in India is too simplistic a basis to hold that deposits placed outside India can be brought to tax in India-DRP acknowledges the fact that there is no direct evidence of any business activity in India-No justifiable basis for bringing to tax the amount standing credit in the name of the non-resident assessee in the foreign bank account-Addition was deleted. [S.5(2), 147, 148]
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