Articles 4, 16 of India-USA DTAA; section 6 of the Act – in case of dual residency, residential status shall be determined by applying tie-breaker test under the DTAA
Geeta Jani | Dhishat B. Mehta Chartered Accountants
5. (2019) 104 taxmann.com 183 (Bangalore –
Trib) DCIT vs. Shri Kumar Sanjeev Ranjan ITA No.: 1665 (Bang.) of 2017 A.Y.: 2013-14 Dated: 15th March, 2019
Articles 4, 16 of India-USA DTAA; section 6
of the Act – in case of dual residency, residential status shall be determined
by applying tie-breaker test under the DTAA
The assessee, a US citizen,was working in the USA since 1986. His spouse
and two children were all US citizens. The assessee was deputed to India by his
employer from June, 2006 to August, 2012. Upon completion of his assignment in
India, the assessee left India on 10.08.2012 and resumed his employment in the
USA. Since then he was residing with his family in the USA.
Prior to 1986, the assessee had lived in
India for 21 years. He relocated to the USA in 1986 and became a permanent
resident in 1992. After marriage, his spouse was also residing in the USA.
Their two children were born there. When he was on assignment to India, the
assessee was taking his vacations in the USA.
The assessee had a house in India as well as
in the USA. He had let out his house in the USA while he was on assignment to
On the basis of his physical presence in
India, the assessee was a tax resident of India for FY 2012-13. The assessee
also qualified as a tax resident of the USA for FY 2012-13. During the period
11.08.2012 to 31.03.2013 the assessee earned a salary in the USA. According to
the AO, since the assessee was a tax resident in India during the relevant AY,
his entire global income, including salary earned in the USA, was liable to tax
in India. Hence, the AO sought to tax his salary in the USA for the period
11.08.2012 to 31.03 2013.
contended before the AO that he should be considered a tax resident of the USA
under the tie-breaker rule of the India-USA DTAA on the basis