Case nº AAR No. 725 of 2006 of Authority for Advance Rulings, July 31, 2006 (case In Re: British Gas India (P) Ltd. Vs)
| Judge | For Appellant: M.S. Syali, Adv. |
| President | Syed Shah Mohammed Quadri, J. (Chairmain) and A.S. Narang, Member |
| Resolution Date | July 31, 2006 |
Order:
Syed Shah Mohammed Quadri, J. (Chairmain)
-
In this application under Section 245Q(1) of the IT Act, 1961 (for short the "Act"), the applicant, British Gas India (P) Ltd., an Indian company seeks advance ruling of the Authority on the following questions:
-
Whether in the facts and circumstances of the case and in law, salary income received in India by Mr. Manish Gupta from British Gas India (P) Ltd. for rendering services outside India is taxable in India?
-
Whether in the facts and circumstances of the case and in law, British Gas India (P) Ltd. is required to withhold taxes on salary paid in India to Mr. Nipun Pradhan and Mr. Manish Gupta for rendering services outside India?
-
The applicant is a part of a BG group, leading international energy company that has expertise across spectrum of the natural gas chain. The applicant has assigned certain individuals including Mr. Manish Gupta to BG group entities outside India. It is stated that Mr. Manish Gupta commenced employment with the Indian company in February/March, 2002 and that w.e.f. 1st July, 2005, he was deputed to BG UK vide assignment letter dt. 25th May, 2005 for two years and has since been working in UK. It is asserted that he would be spending less than 182 days in India in financial year 2005-06, therefore, he is a non-resident under Expln. (a) to Section 6(1) of the Act.
-
The CIT in his remarks stated that in view of the stay of 88 days in India in the financial year 2005-06, the status of Mr. Gupta is that of resident in India.
-
In view of the comments of the CIT, the applicant was given a notice to show cause to explain as to how Mr. Gupta could be considered a non-resident in the light of Expln. (a) to Section 6(1) of the Act; the case was directed to be listed for hearing. The applicant submitted his explanation stating that since Mr. Gupta is a citizen of India and left India for the purpose of employment outside the State, he would be a non-resident if his stay is less than 182 days in that year and as Mr. Gupta's residence in the year in question was only 88 days, he would be a non-resident.
-
Mr. Syali, learned Counsel appearing for the applicant, in response to the show-cause notice submitted that the stay of Mr. Gupta in the financial year 2005-06 is 88 days and as by Expln. (a) to Section 6(1) of the Act, the period of 60 days in Clause (c) has been substituted by 182 days, he would be a non-resident.
It would be useful to refer to Section 6(1) and...
To continue reading
Request your trial