Dear Sir,

A person who is NRI has sold a property in India and earned LTCG. He is non resident as per Residential status provisions. He wants to file his return before going back to USA. I can understand that he is very well covered under section 174 but only if AO issues notice

I want to know is it possible to file the return now. If yes, what is the method for same.

Thanks 

CA Ashish Sharma

Dear Ashish,

Although your client is not legally required to file his income tax return right now. And yes section 174 can be initiated by AO not by the assessee.

However if he still wishes to file his return before his departure from India, then you can voluntary invoke section 230 of the Act. Section 230 is for getting Income Tax Clearance Certificate for the Non Residents who are leaving India with no intention of coming back. With the application u/s 230, assessee is required to file his current year income tax return with till date income accrued and tax thereon in paper format. Although your client is not liable for this certificate u/s 230, But otherwise AO would not accept the income tax return in regular course of dealings.

PS: Pl note that the process of sec 230 is slightly cumbersome.

If you have any questions, Pl post the same.

Also you are requested to please post your opinion on the above.

Kind Regards
TaxReply.com