Re : salary received by non residents

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This query is : Resolved

Pavel (Querist)

06 March 2018 Dear Experts,

My query is as follows :-

A person of Indian origin, is getting salary from Nepal and directly crediting the same into his Indian Bank Account. The salary is being received in USD. Hence, as per the current law, he is required to pay tax in India. Also,he is not paying taxes in Nepal for the same. Hence, accordingly, he has already paid Advance Tax in the previous quarters. But however, very recently, there is a ruling from Authority of Advanced Ruling (AAR) during Feb 2018 which claims that Non Residents are not required to pay tax in the money received in the Indian Bank Account since the income is not actually accrued in India.

My questions are :-
1. What will be the treatment if the person is Non Resident?
2. What should be followed ? The AAR ruling or Income Tax Act, 1961?
3. Can the judgement be used by any other person as it is actually binding on the applicant who sought Advanced Ruling?
4. What to be done for the already paid Advance Tax ( for the 3 quarters) incase the Authority of Advanced Ruling is followed? What should be followed - IT Act or AAR ruling?

Require your earnest help.
Thanks

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

06 March 2018 1 No tax payable in India on salary earned outside India by non resident.
2 AAR ruling to be followed.
3 Yes you are right obtaining similar ruling is possible
4 File ITR claim refund.

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