Taxontips
No Result
View All Result
Tuesday, June 3, 2025
Login/ Register
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Talk to an Expert
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
No Result
View All Result
Taxontips
No Result
View All Result

Rent earned from property situated outside India by assessee resident in India cannot be taxed in India – Delhi ITAT

Income tax Expert by Income tax Expert
July 25, 2022
in Case Laws, Income Tax News
0
Income tax Appellate Tribunal (ITAT) to not function from 17.03.2020 to 27.03.2020
120
SHARES
1.5k
VIEWS
image_pdfPDFimage_printPrint

The above judgement has been passed by Hon’ble Delhi ITAT in case of Natasha Chopra Vs. DCIT, Circle-17(2), New Delhi ITA No. 6121/Del/2018.

 

Facts of the case:

Assessee is a Director in N&N Chopra Consultants Private limited and has derived salary and rental income from this company

Apart from the Indian Income, the assessee had also earned income from house property situated in Australia and United Kingdom. However, it had shown such foreign Income as not taxable in India

 

Assessee’s contention:

The assessee is a tax resident of India received rental income from the properties outside India held by her in England and Australia and declared the rental income received by her in her return of income filed in Australia and United Kingdom.

Since the income has already been offered to tax in UK and Australia and as per DTAA income cannot be taxed in India again.

 

Revenue’s contention:

The Assessing Officer contended that the amount of the rental income to tax notwithstanding the fact that the assessee has declared rental income from properties situated in England and Australia.

AO relied on the Article 6(1) of DTAA with UK which reads “income from immovable property may be taxed in contracting state in which such property situated”. The AO referred to the Notification No. 91/2008 dated 28.08.2008 and construed the words “may be taxed” as “shall be taxed” and hence assessed that such rent “should only be” charged to tax in India only.

 

Ruling: 

Thus, we find that in the absence of an express provision, the right of the resident country to tax its residents cannot be taken away under the DTAA. Therefore, the expression “may be taxed” cannot be construed to mean “shall be taxable only in the resident state”, unless it is expressly stated. Provisions of Section 90(1)(a)(i) is clearly applicable to the facts of the case.

In the result, both the appeals of the assessee are allowed.

 

Author’s comments on the judgement:

In our humble opinion and with due respect to Hon’ble ITAT we believe that as per the Income Tax Act of India, the resident country has full right to tax the global income of a tax resident, after taking into consideration relevant article of DTAA i.e. Article 6.

 

The judgement/ ruling passed in the above case is incomprehensible as no clear guidance has been provided as to why the Income cannot be taxed in resident country and why appeal of the assessee is allowed.

 

Hon’ble ITAT has mentioned that the word “may” cannot be considered as “shall”, and hence passed on a judgement that if tax has been paid in foreign country no tax needs to be paid in resident country which in our humble opinion is not a correct interpretation of DTAA. Also, the word “may” in any DTAA gives right to both the country to tax the income in their respective country and not just one country and the correct interpretation would be to ask assessee to tax the income in India and allow her the credit of tax paid in foreign country in India, if available.

 

The notification referred to above i.e. Notification No. 91/2008 does not states that the word “may” should be considered as “shall” rather it states that for the purpose of DTAA where the word “may” is used such income “shall be taxed in India” and necessary relief shall be granted and it nowhere states that the income shall be only taxed in India.

 

Hence, in our humble opinion the judgement passed should not be used as a precedent for claiming exemption of any foreign income by tax resident in India if no specific relief is available in Income tax Act or DTAA.

 

Section Article 6 and section 90
DTAA/Country India- UK and Australia
Court ITAT-Delhi
Date of Decision 30.06.2022

 

To download the judgement CLICK ME.

 

Article authored by:

 

 

 

 

 

CA Naman Maloo (C.A., B.Com)
He is currently working as Partner – Direct Tax with a renowned firm in Jaipur having experience in dealing Assessments, Tax Audit, International Taxation, Tax planning for NRI, Business planning and consultation.
E-mail: naman.maloo@jainshrimal.in | LinkedIn: Naman Maloo

 

Disclaimer: The views presented in the above article are personal views of the author and has no legal binding. For any legal opinion consult a tax professional.

 

Connect with us on: LinkedIn, Telegram, Instagram, Facebook, Twitter and Youtube for regular Updates.

image_pdfPDFimage_printPrint
Tags: income tax case lawIncome tax updatesITAT judgementlatest income tax case lawtaxontips
Previous Post

Simplified regulatory framework for e-commerce exports of jewellery through courier mode

Next Post

Time limit for verification of ITR reduced from within 120 days to 30 days of filing of ITR electronically

Related Posts

Tatva Chintan Pharma Chem Limited IPO details and capital gain tax on selling IPO allotment | Capital gain on IPO
Case Laws

ITAT Mumbai: Capital Gains on Indian Mutual Funds Not Taxable in India for Non-Residents under DTAA [Case law]

May 2, 2025
Guidelines for manual selection of returns for Complete Scrutiny during the financial-year 2019-20-
Income Tax News

No relief under section 87A for capital gain even after date extended to file revised return for AY 2024-25?

April 1, 2025
Received mail from GSTN “Aggregate turnover being more than Rs. 5 Cr during FY 2019-20” What does this mean?
Income Tax News

Assessee receiving message for 80GGC donation for AY 2022-23 from Income tax department

January 29, 2025
Guidelines for manual selection of returns for Complete Scrutiny during the financial-year 2019-20-
Income Tax News

Guidance note 2 issued for Vivad se vishwas Scheme, 2024 [Read circular]

January 1, 2025
Guidelines for manual selection of returns for Complete Scrutiny during the financial-year 2019-20-
Income Tax News

Due date extended for filing belated, revised return and Vivad se vishwas declaration

December 31, 2024
Due date for Tax audit for A.Y. 2019-20 extended from 30th September to 31st October
Income Tax News

Extension of due date for furnishing return of income from 30.11.2024 to 15.12.2024

November 30, 2024
Next Post
Who can sign/ e verify your Income tax return?

Time limit for verification of ITR reduced from within 120 days to 30 days of filing of ITR electronically

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Google Custom search

Recent Posts

  • Statutory Compliance Calendar for May 2025 | Income tax, GST and various other laws
  • ITAT Mumbai: Capital Gains on Indian Mutual Funds Not Taxable in India for Non-Residents under DTAA [Case law]
  • Statutory Compliance Calendar for April 2025 | Income tax, GST and various other laws
  • No relief under section 87A for capital gain even after date extended to file revised return for AY 2024-25?
  • Statutory Audit of Cash and Cash Equivalents in Indian Companies [Company Law]

Recent Comments

  • k.salam on Statutory Compliance Calendar for May 2025 | Income tax, GST and various other laws
  • Brendan Gleeson on Clarification for the purposes of Section 269ST of the I.T. Act in respect of dealership/distributorship contract in case of Co-operative Societies
  • Kovac Ryker on Clarification for the purposes of Section 269ST of the I.T. Act in respect of dealership/distributorship contract in case of Co-operative Societies
  • Hailey Bradwell on Clarification for the purposes of Section 269ST of the I.T. Act in respect of dealership/distributorship contract in case of Co-operative Societies
  • ADMIN on Submit response to confirm/ revise the refund claim – Why are you getting this mail and how to get refund

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Browse Topics by Date

June 2025
M T W T F S S
 1
2345678
9101112131415
16171819202122
23242526272829
30  
« May    
  • GSTR 9/ 9C extended : AGAIN

    GSTR 9/ 9C due date to be extended to 31.10.2020 | E-invoicing will be voluntary in the beginning

    6537 shares
    Share 2615 Tweet 1634
  • How to pay Membership and COP fees of ICAI for 2020-21 |

    6444 shares
    Share 2578 Tweet 1611
  • Code/ Nature of payment 6CR updated by NSDL in challan 281 for paying TCS on sale of goods

    5902 shares
    Share 2361 Tweet 1476
  • Are all the due dates of tax audit and Income tax return for FY 2019-20 extended to 31.03.2021 by the bill presented in Lok sabha Dt. 18.09.2020

    4855 shares
    Share 1942 Tweet 1214
  • SFT transaction mentioned in Form 26AS | What does it mean? | Who reports it? | SFT codes transaction type

    4083 shares
    Share 1633 Tweet 1021

Recent Notification

Compliance due dates for June, 2020 | Compliance calendar for June, 2020 | 20+ compliances

Statutory Compliance Calendar for May 2025 | Income tax, GST and various other laws

May 8, 2025
Tatva Chintan Pharma Chem Limited IPO details and capital gain tax on selling IPO allotment | Capital gain on IPO

ITAT Mumbai: Capital Gains on Indian Mutual Funds Not Taxable in India for Non-Residents under DTAA [Case law]

May 2, 2025

RSS Taxontips

  • Statutory Compliance Calendar for May 2025 | Income tax, GST and various other laws
  • ITAT Mumbai: Capital Gains on Indian Mutual Funds Not Taxable in India for Non-Residents under DTAA [Case law]
  • Statutory Compliance Calendar for April 2025 | Income tax, GST and various other laws
  • No relief under section 87A for capital gain even after date extended to file revised return for AY 2024-25?
  • Statutory Audit of Cash and Cash Equivalents in Indian Companies [Company Law]
  • Statutory Audit of Trade Receivables in Indian Companies [Company law]
  • Statutory Compliance Calendar for February 2025 | Income tax, GST and various other laws
  • Budget 2025 updates | Income tax and GST updates
  • Assessee receiving message for 80GGC donation for AY 2022-23 from Income tax department
  • Statutory Audit of Inventories for Indian Companies [Company Law]

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Site menu

  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Taxontips

TaxOnTips provides you all tax related solutions in easy way and update you with its regular updates & notifications Visit us for details.
We are based in Jaipur, India

© 2019-2023 Taxontips.com - Tax assistance at your Fingertips

No Result
View All Result
  • Login/Signup
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • About us
  • Contact us
  • Ask an expert/ Talk to an expert
  • Q & A
  • Privacy Policy
  • Terms of use

© 2019-2023 Taxontips.com - Tax assistance at your Fingertips

Book Phone consultation with expert

Sitting home or at your office and don't have time to visit CA's office or don't know where to consult CA. Book your consultation with an expert practicing Chartered Accountant and get your query solved.

Book a phone consultation for 30 minutes with our expert at a very basic cost.

Book consultation

No thanks, I'm not interested!