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get completed and do not remain pending for This remains exempt until he reaches a
long. certain age, say 66 years or so, from the US
FACELESS APPEALS BEFORE point of view. If he were to withdraw the
THE TRIBUNAL The concept of faceless funds before that date he would be taxable
assessments has already been introduced a in the US, but if he does not withdraw till the
couple of years ago. An assessee would file specified age then the income in his hands is
a return but the notice for enquiry could exempt from US tax.
come from any Officer in the country and However, if a person had opened a 401(K)
not necessarily an Officer from the same Account while he was in the USA and then
city. Accordingly the queries have to be has come back to India and continues to
communicated well by the Officers and a retain his funds in the US, and the fund
proper reply is to be given by the assessee. earns income by way of Dividend or Capital
There are certain circumstances in which a Gain, while it is exempt in the US it would be
hearing could be useful but on the whole this taxable in India, even if the assessee has not
is an effective process. actually drawn out any money from the fund.
The first appeal before the CIT(A) is also A new provision is proposed to be
now being taken up on a faceless basis, to introduced to say that the money will not
some extent. be taxable in India and India will follow the
It is now proposed to do this even for appeals Overseas Rules for taxation in the case of a
to the Tribunal. Rules will be formulated in retirement fund.
the next 2 years, i.e. by 31.3.2023. The merits
of this system will have to be considered. In Conclusion
fact the right to a hearing is considered as one In this year of the lockdown it was expected
of the cardinal principles of law and is termed that the Government may want to levy a
as a rule of “Natural Justice”. Therefore, Covid tax or may reintroduce Wealth tax and
if hearings are not provided for and there Estate Duty.
is only the submission of documents, it Luckily this has not happened.
may happen that the nuances of the issues There was need, however, for some relief to
are missed out and this can lead to wrong other sectors such as, tourism, because hotels
judgments. and restaurants have suffered tremendously.
So this matter should be carefully This could have been in the form of a
considered and while the concept of Faceless reduction in GST.
Appeals may be implemented on a trial basis We do have to be grateful for the fact
it should be optional for an assessee to have that taxes have not been increased, but
an oral hearing or just to submit documents. on the other hand taxes have not been
OVERSEAS RETIREMENT FUNDS This reduced either. So we have to approach this
amendment may be useful for some persons philosophically and take it as it comes!
who have come back from overseas and have
retirement funds outside India. For example, Disclaimer:
in the USA, a person may have a Retirement The material contained here is brief and
fund. This is known as a 401(K) Fund. When contains generalisations, and is only
an assessee is earning substantial amounts, illustrative. Legal opinion and tax advice
he can deposit money into the 401(K) Fund. must be taken.
SENIORS TODAY | ISSUE #20 | FEBRUARY 2021 17
