Section 6 of Income Tax Act "Residence in India"
6. For the purposes of this Act,-
(1) An individual is said to be resident in India in any
previous year, if he-
(a) is in India in that year for a period or periods
amounting in all to one hundred and eighty-two days or more
; or
(b) [***]
(c) having within the four years preceding that year been in
India for a period or periods amounting in all to three
hundred and sixty-five days or more, is in India for a
period or periods amounting in all to sixty days or more in
that year.
Explanation 1.-
In the case of an individual,-
(a) being a citizen of India, who leaves India in any
previous year as a member of the crew of an Indian ship as
defined in clause (18) of section 3 of the Merchant Shipping
Act, 1958 (44 of 1958), or for the purposes of employment
outside India, the provisions of sub-clause (c) shall apply
in relation to that year as if for the words "sixty days",
occurring therein, the words "one hundred and eighty-two
days" had been substituted ;
(b) being a citizen of India, or a person of Indian
origin within the meaning of Explanation to clause (e)
of section 115C, who, being outside India, comes on a
visit to India in any previous year, the provisions of
sub-clause (c) shall apply in relation to that year as
if for the words "sixty days", occurring therein, the
words "one hundred and eighty-two days" had been
substituted 6[and in case of 6a[the citizen or person of
Indian origin] the citizen or person of Indian origin
having total income, other than the income from foreign
sources, exceeding fifteen lakh rupees during the
previous year, for the words "sixty days" occurring
therein, the words "one hundred and twenty days" had
been substituted].
Explanation 2.-
For the purposes of this clause, in the case of an
individual, being a citizen of India and a member of the
crew of a foreign bound ship leaving India, the period
or periods of stay in India shall, in respect of such
voyage, be determined in the manner and subject to such
conditions as may be prescribed.
Following clause (1A) shall be inserted after clause (1)
of section 6 by the Finance Act, 2020, w.e.f. 1-4-2021 :
(1A) Notwithstanding anything contained in clause (1),
an individual, being a citizen of India, having total
income, other than the income from foreign sources,
exceeding fifteen lakh rupees during the previous year
shall be deemed to be resident in India in that previous
year, if he is not liable to tax in any other country or
territory by reason of his domicile or residence or any
other criteria of similar nature.
Following Explanation shall be inserted after clause
(1A) of section 6 by the Taxation and Other Laws
(Relaxation and Amendment of Certain Provisions) Act,
2020, w.e.f. 1-4-2021 :
Explanation.-
For the removal of doubts, it is hereby declared that
this clause shall not apply in case of an individual who
is said to be resident in India in the previous year
under clause (1).
(2) A Hindu undivided family, firm or other association
of persons is said to be resident in India in any
previous year in every case except where during that
year the control and management of its affairs is
situated wholly outside India.
(3) A company is said to be a resident in India in any
previous year, if-
(i) it is an Indian company; or
(ii) its place of effective management, in that year, is
in India.
Explanation.-
For the purposes of this clause "place of effective
management" means a place where key management and
commercial decisions that are necessary for the conduct
of business of an entity as a whole are, in substance
made.
(4) Every other person is said to be resident in India
in any previous year in every case, except where during
that year the control and management of his affairs is
situated wholly outside India.
(5) If a person is resident in India in a previous year
relevant to an assessment year in respect of any source
of income, he shall be deemed to be resident in India in
the previous year relevant to the assessment year in
respect of each of his other sources of income.
(6) A person is said to be "not ordinarily resident" in
India in any previous year if such person is-
(a) an individual who has been a non-resident in India
in nine out of the ten previous years preceding that
year, or has during the seven previous years preceding
that year been in India for a period of, or periods
amounting in all to, seven hundred and twenty-nine days
or less; or
(b) a Hindu undivided family whose manager has been a
non-resident in India in nine out of the ten previous
years preceding that year, or has during the seven
previous years preceding that year been in India for a
period of, or periods amounting in all to, seven hundred
and twenty-nine days or less 7[; or
(c) a citizen of India, or a person of Indian origin,
having total income, other than the income from foreign
sources, exceeding fifteen lakh rupees during the
previous year, as referred to in clause (b) of
Explanation 1 to clause (1), who has been in India for a
period or periods amounting in all to one hundred and
twenty days or more but less than one hundred and
eighty-two days; or
(d) a citizen of India who is deemed to be resident in
India under clause (1A).
Explanation.-
For the purposes of this section, the expression "income
from foreign sources" means income which accrues or
arises outside India (except income derived from a
business controlled in or a profession set up in India)
7a[and which is not deemed to accrue or arise in
India]].
Section 7 of Income Tax Act "Income deemed to be received"
7. The following incomes shall be deemed to be received
in the previous year :-
(i) the annual accretion in the previous year to the balance
at the credit of an employee participating in a recognised
provident fund, to the extent provided in rule 6 of Part A
of the Fourth Schedule ;
(ii) the transferred balance in a recognised provident fund,
to the extent provided in sub-rule (4) of rule 11 of Part A
of the Fourth Schedule ;
(iii) the contribution made, by the Central Government or
any other employer in the previous year, to the account of
an employee under a pension scheme referred to in section
80CCD.
What are the Definitions under Income Tax 1961? Section 2 of Income Tax Act 1961
What is Previous Year? What is Charge of Income tax? Section 3 and 4 of Income Tax Act 1961
What is Dividend income? Section 8 of Income Tax Act 1961
What is Income deemed to accrue or arise in India? Section 9 of Income Tax Act 1961
What are the Incomes not included in total income? Section 10 of Income Tax Act 1961
What is Meaning of computer programmes in certain cases? Section 10BB of Income Tax Act 1961