19 August 2016
The assessee is a Officer in Merchant Navy. For certain years he filed his return claiming NRI status. The income he earned was exempt for Non Residents. He invested the income in Mutual Funds and earned return on that. Tax on investment income was duly paid. Now to buy peace of mind he wants to make use of Income Declaration Scheme. According to the Scheme he has to pay the tax on value of investment as on 01-06-2016. But that means he has to pay double tax on investment income the one he has already paid and the other one as per Income declaration scheme.. My query is should he pay tax on Income earned or value of investment as he has already suffered tax on gains on investments? Secondly can he use Income declaration scheme as his income was earned in Foreign currency? Would he not fall in ambit of Black money Act?
19 August 2016
Dear Sanjeev,
I feel the reason why your client is feeling this way is because of the recent decision given by the high court( I think Kerala or Bombay high court not sure) that the income earned by merchant Navy officers is Taxable in India.
Tel him he is not required to declare in the given scheme as he does not fall in its ambit.
CAclubindia
