Foreign salary in NRE account not taxable for NRIs, ITAT quashes ₹12 lakh tax demand

ITAT Ahmedabad ruled foreign salary earned outside India is not taxable merely because credited to NRE account or TDS deducted using Indian TAN.

The Tribunal quashed a ₹12 lakh tax demand against NRI Pralay Pradyotkanti Ghosh for Assessment Year 2016-17.

The Assessing Officer had conducted detailed verification including employment contract, passport, travel records, bank statements, Form 26AS, and residential proof.

ITAT held that the tax department cannot reopen a completed assessment under Section 263 solely based on a different view, if proper enquiries were done.

The salary from Oceaneering International GmbH for work in international waters was exempt as it was earned while the taxpayer was a non-resident.