CA Jasmeet Singh Arora 1.
RESIDENTIAL STATUS
Residential status of individuals Section 6(1) / 6(6)(a)
Section 6(1), an individual is said to be resident, if he satisfies any one of the
following two basic conditions:
(i) He stays in India for 182 days or more during the relevant previous year (RPY)
(ii) He stays in India for 60 days or more in RPY and also for 365 days or more during 4
years preceeding the RPY.
Note:
1. Period of stay may not be continuous.
2. Date of departure and arrival both shall be considered for stay in india.
Exceptions to the basic condition - Check only 182 days
1. If an Indian Citizen leaves India for the purpose of employment
2. If an Indian Citizen leaves India as a crew member of Indian Ship.
Note: Date of Joining and Date of Signing Off As per continuous discharge
certificate shall be considered as outside India in the case of crew member of
foreign going Ship.
* Indian Income includes Foreign business income whose control is in India or foreign
professional income whose setup is in India
Section 6(6), An individual is said to be a resident and ordinarily resident if he
satisfies both the following conditions:
(i) He is a resident in any 2 out of last 10 previous year, and
(ii) His total stay in India in the last 7 years is 730 days or more.
CA Jasmeet Singh Arora 1.2
Deemed Resident Section 6(1A)
Individual Shall be NOR if all of the following conditions are satisfied:-
a) Individual is Indian Citizen
b) Total income excluding income from foreign sources but including foreign business
income whose control is in India, exceeds 15 Lakh.
c) Such person is not paying Tax In any Country due to his domicile, residence or
similar nature
Residential status of HUF Section 6(2)/6(6)(b).
Section 6(2), an HUF would be resident in India if C&M of its affairs is situated
wholly or partly in India. Otherwise, Non- resident.
Section 6(6)(b), An HUF is said to be ROR if Karta satisfies both additional conditions,
Otherwise NOR
Residential status of partnership firm or BOI or AOP Section 6(2)
Resident → C&M is wholly or partially in India, other wide NR.
Residential Status Of Company Section 6(3)
Indian Co. → Always Resident.
Foreign company → Resident if POEM is in India
Scope of Total Income or Tax Incidence [Section 5]
Income Accrue or Arise / Income Received / Deemed To Be Income
Deemed To Accrue or Arise Received
India India Indian
India Outside India Indian
Outside India India Indian
Outside India Outside India Foreign
Income ROR NOR NR
Indian Taxable Taxable Taxable
Foreign Taxable Non – Taxable Non -
Exception : Following Foreign Incomes are Taxable. Taxable
1. Business Income – Business Controlled From
India.
2. Professional Income – Profession Set Up in india
CA Jasmeet Singh Arora 1.3
Income deemed to accrue or arise in India Section 9
1. Any income accruing or arising to an assessee in any place outside India whether
directly or indirectly
(a) through or from any business connection in India,
(b) through or from any property, any asset or source of income in India or
(c) through the transfer of a capital asset situated in India would be deemed to accrue
or arise in India.
Exception:
• Purchase for export.
• Collection of news.
• Shooting of film in India by foreign citizen.
2. Income, which falls under the head “Salaries”, deemed to accrue or arise in India, if it is
earned in India. Salary payable for service rendered in India would be treated as earned
in India.
3. Income from ‘Salaries’ which is payable by the Government to a citizen of India for
services rendered outside India would be deemed to accrue or arise in India. However,
allowances and perquisites paid or allowed outside India by the Government to an
Indian citizen for services rendered outside India is exempt, by virtue of section 10(7).
4. Interest On Loan
5. Royalty Or fees from technical services
