Section 115C of Income Tax Act "Definitions"
115C. In this Chapter, unless the context otherwise
requires,-
(a) "convertible foreign exchange" means foreign exchange
which is for the time being treated by the Reserve Bank of
India as convertible foreign exchange for the purposes of
the Foreign Exchange Management Act, 1999 (42 of 1999), and
any rules made thereunder;
(b) "foreign exchange asset" means any specified asset which
the assessee has acquired or purchased with, or subscribed
to in, convertible foreign exchange;
(c) "investment income" means any income derived 83[other
than dividends referred to in section 115-O] from a foreign
exchange asset;
(d) "long-term capital gains" means income chargeable
under the head "Capital gains" relating to a capital asset,
being a foreign exchange asset which is not a short-term
capital asset;
(e) "non-resident Indian" means an individual, being a
citizen of India or a person of Indian origin who is not a
"resident".
Explanation.-A person shall be deemed to be of Indian origin
if he, or either of his parents or any of his grand-parents,
was born in undivided India;
(f) "specified asset" means any of the following assets,
namely :-
(i) shares in an Indian company;
(ii) debentures issued by an Indian company which is not a
private company as defined in the Companies Act, 1956 (1 of
1956);
(iii) deposits with an Indian company which is not a private
company as defined in the Companies Act, 1956 (1 of 1956);
(iv) any security of the Central Government as defined in
clause (2) of section 2 of the Public Debt Act, 1944 (18 of
1944);
(v) such other assets as the Central Government may specify
in this behalf by notification in the Official Gazette.
115D. (1) No deduction in respect of any expenditure or
allowance shall be allowed under any provision of this Act
in computing the investment income of a non-resident Indian.
(2) Where in the case of an assessee, being a non-resident
Indian,-
(a) the gross total income consists only of investment
income or income by way of long-term capital gains or both,
no deduction shall be allowed to the assessee under Chapter
VI-A and nothing contained in the provisions of the second
proviso to section 48 shall apply to income chargeable under
the head "Capital gains";
(b) the gross total income includes any income referred to
in clause (a), the gross total income shall be reduced by
the amount of such income and the deductions under Chapter
VI-A shall be allowed as if the gross total income as so
reduced were the gross total income of the assessee.