As per the Income-Tax Appellate Tribunal (ITAT), NRIs are not obliged
to provide details in relation to their foreign assets and bank
accounts held outside of the country.Nonetheless, also when there
arises
some discrepancy, the onus lies with the department of tax in India to
prove otherwise i.e. whether or not the assessee has held undeclared
income due from Indian shore in foreign accounts.
NRIs Not To Disclose Foreign Assets, Bank A/cs: Income Tax Tribunal
The
judgment has been passed in case of a recent case that involved Japan
based NRI who maintains an account in Geneva with HSBC Bank. A resident
of Japan since the year 1990 received the country's residency in 2001
and is a non-resident Indian taxpayer from 1995-96.
"The
assessing officer erred in making additions towards deposits found in
HSBC Bank account, Geneva under Section 69 of the Income Tax Act," said
the Mumbai Bench of the ITAT.
Also, it was approved that the
foreign bank account is not illegal and the provision of Black Money
(undisclosed foreign income and assets) and Imposition of Tax Act, 2015,
apply only to Indian residents.
It was also conferred that it
does not necessarily imply that Indians who maintain bank account
outside of their native country do it only to stash black money and
evade tax.
The case came into light after the French government
as part of the DTAA (double taxation avoidance agreement) revealed his
name in the list of account holders of India with HSBC Bank, Geneva. And
based on the details, his assessment was reopened in the year 2014.
Japan based Pandya filed ITR for the assessment year 2006-07 with a
declared income of Rs. 5.51 lakh.