Law:

Section:

(a) Wealth tax--- ----Exemption---Moneys and assets brought by Indian citizen ordinarily residing abroad who returns with intention of residing in India permanently--­Law applicable---Effect of amendment of S.5(1)(xxxiii) w.e.f. 1-4-1987-­Remittances made prior to return---Not entitled to exemption in assessment year 1985-86---Indian Wealth Tax Act, 1957, S.5---[V.P. Gopinathan (Dr. v. CWT (1996) 221 ITR 401 (Ker.) overruled]. Section 5(1)(xxxiii) of the Wealth Tax Act, 1957, inserted by the Finance Act, 1976, with effect from April 1, 1977, grants exemption, for and from the assessment year 1977-78, to an assessee, being a person o Indian origin (as defined in Explanation 1) or a citizen of India, who was ordinarily residing in a foreign country and who, leaving such country, ha returned to India with the intention of permanently residing in India. In the assessment years 1977-78 to 1986-87, the exemption was in respect o moneys and the value of assets brought by him to India and the value o assets acquired by him out of such moneys. However, for and from the assessment year 1987-88, the scope of such exemption has been broadened also in respect of moneys and the value of assets brought by the eligibly assessee to India and the value of assets acquired by him out of such moneys within one year immediately preceding the date of his return Explanation 2 to section 5(1)(xxxiii) (which has been inserted by the Finance Act, 1986 with retrospective effect from April 1, 1977) clarifies that money standing to the credit of an eligible assessee' in a non-resident (external; account in any bank in India in accordance with the Foreign Exchange Regulation Act, 1973, and any rules made thereunder on the date of hi; return to India, shall be deemed to be moneys brought by him into India or that date. Earlier, a Department Circular No. 411, dated February 25, 1985 had clarified the same position in the absence of a statutory provision in that regard. Such exemption is available only for a period of seven successive assessment years commencing with the assessment year next following the date on which such eligible assessee returned to India'. Thus, where an eligible assessee…

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