* The AAR has observed that for the income earned by the applicant on account of employment outside India to be taxable in India, the applicant should have been resident of India during the relevant previous year.
* Section 6(1) of the Act, which determines the status of an individual as resident in India, requires that either the applicant should have been in India for 182 days [vide clause (a)] or for 60 days or more, if he was in India for 365 days or more in four preceding years [vide clause (c)]. Further, explanation to Section 6(1) of the Act provides that a citizen of India who leaves India forthe purpose of employment outside India can be considered to be resident of India, if he has been in India for 182 days or more even though he may have been in India for more than 365 days in four preceding years.
* If the applicant has spent less than 182 days in India during a previous year and was outside India for the purposes of employment, then regardless of his being in India for 365 days or more during four preceding previous years, the applicant cannot be treated as a resident of India.
* If the applicant was not present in India for more than 365 days in 4 preceding years, then clause (a) of sub-section (1) of section 6 would apply and it requires stay of 182 days or morein India to be treated as resident. On the other hand, if the applicant was present in India for 365 days or more during four preceding years, then clause (c) of sub-section (1) to section 6 read with Explanation (a) would apply and it requires stay of 182 days or more in that previous year for a person who leaves India for employment outside, to be treated as resident of India.
* In the instant case, the applicant neither satisfies the condition of Section 6(1 )(a) nor satisfies the condition of Section (6)(1)(c) of the Act and accordingly he cannot he treated as the resident of India for the previous year under consideration. Thus, the salary earned by the applicant by virtue of t in India under section 5(1)(c) of the Act. Further, the department in its comment dated 28 th January 2010 also clarified that the applicant may be treated as Non Resident as he remained in India for a period of 123 days during F.Y. 2008-09.
