S. 68 : Cash credits-Foreign bank deposits-HSBC account-Non-Resident-Merely on the basis of ‘base note’ addition cannot be made in the hands of non-Resident-Deletion of addition is affirmed. [S. 5(2), 6, 147, 148]
The assessee is a non-resident since AY. 2001-02. The assessee is working an employee in Belgium and has no business communication in India or outside India and source of income are only those which are disclosed to the tax authorities. The assessment of assessee was reopened on the basis of ‘base note’ of the assessee in HSBC account being USD 67421, translated to Rs. 30,33,945 added as income deemed to accrue or arise in India for which the assessee has not offered any explanation about the source and nature thereof . On appeal the CIT(A) deleted the addition following the judgement of the Tribunal in the case of Dy. CIT v. Hemant Mansuklal Pandya (ITA Nos. 4679 & 4680/M/2016, dt. 18-10-2018 (2018) 100 taxmann.com 280 / 68 ITR 345 (Mum.)(Trib.). On reassessment the order of the AO was affirmed. On appeal by the revenue dismissing the appeal the Tribunal held that ‘base note‘ could have been used for Income-tax in hands of the assessee only if he is resident in India. There is no deposit during the year. Accordingly the order of the CIT(A) is affirmed. The Cross objection of the assessee was dismissed as infructuous. (ITA No. 494/Mum/2021, ITA No. 493/Mum/2021, Co. No. 155/Mum/2021, CO No. 156/Mum/2021, dt. 31-10-2022) (AY. 2006-07, 2007 -08)
DCIT v. Manish Vijay Mehta (Mum.)(Trib.) www.itatonline.org
DCIT v. Urvi Manish Mehta (Mum.)(Trib.) www.itatonline.org
[Coram : Hon’ble Shri Prashant Maharishi, AM and Hon’ble Shri Sandeep Singh Karhail, JM]