INCOME EARNED IN DUBAI AND INVESTED IN INDIA BY UAE RESIDENTS IS NOT TAXABLE AS VAGUE INVESTMENT: ITAT MUMBAI

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INCOME EARNED IN DUBAI AND INVESTED IN INDIA BY UAE RESIDENTS IS NOT TAXABLE AS VAGUE INVESTMENT: ITAT MUMBAI

19/02/2023

INCOME EARNED IN DUBAI AND INVESTED IN INDIA BY UAE RESIDENTS IS NOT TAXABLE AS VAGUE INVESTMENT: ITAT MUMBAI

The brief facts of the case, as emanating from the record, are: The assessee is an Indian National, fiscally domiciled in and tax resident of UAE for over three decades and therefore he is eligible for benefit of India UAE Double Taxation Avoidance Agreement.

As per information received from the DDIT Investigation, Mumbai it was noticed that the assessee has paid cash amounting to Rs. 3,65,00,000/- as loan during the year under consideration to M/s Ahuja Group. Since, the assessee has not filed his return of income within the time of prescribe u/s 139 of the Act, the case of the assessee was reopened u/s 147 of the Act.

In pursuance of the notice u/s 148 of the Act, return of income was filed by the assessee on 13-04-2018 declaring miniscule amount of Rs. 1,11,368/-. During the course of assessment proceedings, the assessee submitted that only -payment made by him was towards properties purchases and/or advances against such purchases. Further, the assessee denied, to have made undisclosed investment in India.

The Assessing Officer vide order dated 29-12-2018 passed u/s 143(3) r.w.s. 147 of the Act did not agree with the submissions of the assessee and treated the amount of Rs. 3,65,00,000/- as unexplained investment of the assessee made from the undisclosed sources and added the same to the total income of the assessee u/s 69 of the Act. In the result, appeal by the Revenue is dismissed.

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