CBDT issues clarification on residency under Income Tax Act

New Delhi [India], March 4 : Central Board of Direct Taxes (CBDT) on Wednesday issued a clarification in respect of residency under the Income Tax Act, 1961 vide Circular No.2 of 2021 dated March 3. If any individual is facing double taxation even after taking into account the relief provided by the relevant Double Taxation Avoidance Agreement (DTAA), they now have a solution.
According to a statement issued by CBDT, "The Central Board of Direct Taxes has received various representations for relaxation in the determination of the residential status of previous year 2020-21 from individuals who have come on a visit to India during the previous year 2019-20 and intended to leave India but could not do so due to suspension of international flights. The matters have since been examined by CBDT."
In this context, Circular number 2 has been issued by CBDT which stated that if any individual is facing double taxation even after taking into account the relief provided by the relevant Double Taxation Avoidance Agreement (DTAA), he/she may furnish the specified information by March 31, 2021 in Form -NR annexed to the circular.
As per the CBDT, this form is to be submitted electronically to the Principal Chief Commissioner of Income-Tax (International Taxation). The circular can be accessed on the Income Tax Department official website.
Meanwhile, the re-appointment of Pramod Chandra Mody as Chairman of the CBDT has been extended for a further period of three months. Mody is a 1982-batch Indian Revenue Service officer, was appointed as the CBDT chief in February 2019.