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INCOME-TAX ACT, 1961

43 OF 1961

AS AMENDED BY FINANCE ACT, 2011

An Act to consolidate and amend the law relating to income-tax and super-tax

B E it enacted by Parliament in the Twelfth Year of the Republic of India as follows :

CHAPTER I

PRELIMINARY

Short tt!", "#t"$t %$& 'o(("$'"("$t)

1)(1 This !ct may be called the Income"ta# !ct$ 1%&1'

( It e#tends to the whole of India'

() *a+e as otherwise pro+ided in this !ct$ it shall come into force on the 1st day of !pril$ 1%&'

D"*$to$+)

2)In this !ct$ unless the conte#t otherwise re,uires$

(1 -ad+ance ta#. means the ad+ance ta# payable in accordance with the pro+isions of /hapter 0II"

/2

(1A -a3ricultural income. means

(a any rent or re+enue deri+ed from land which is situated in India and is used for a3ricultural

purposes2

(b any income deri+ed from such land by

(i a3riculture2 or

(ii the performance by a culti+ator or recei+er of rent"in"4ind of any process ordinarily

employed by a culti+ator or recei+er of rent"in"4ind to render the produce raised orrecei+ed by him fit to be ta4en to mar4et2 or

(iii the sale by a culti+ator or recei+er of rent"in"4ind of the produce raised or recei+ed by him$

in respect of which no process has been performed other than a process of the nature

described in para3raph (ii of this sub"clause 2

(c any income deri+ed from any buildin3 owned and occupied by the recei+er of the rent or

re+enue of any such land$ or occupied by the culti+ator or the recei+er of rent"in"4ind$ of any

land with respect to which$ or the produce of which$ any process mentioned in para3raphs ( ii

and (iii of sub"clause (b is carried on :

Pro&"&that

(i the buildin3 is on or in the immediate +icinity of the land$ and is a buildin3 which therecei+er of the rent or re+enue or the culti+ator$ or the recei+er of rent"in"4ind$ by reason of

his connection with the land$ re,uires as a dwellin3 house$ or as a store"house$ or other out"

buildin3$ and

(ii the land is either assessed to land re+enue in India or is sub5ect to a local rate assessed and

collected by officers of the 6o+ernment as such or where the land is not so assessed to land

re+enue or sub5ect to a local rate$ it is not situated

(A in any area which is comprised within the 5urisdiction of a municipality (whether

4nown as a municipality$ municipal corporation$ notified area committee$ town area

committee$ town committee or by any other name or a cantonment board and which

has a population of not less than ten thousand accordin3 to the last precedin3 census

of which the rele+ant fi3ures ha+e been published before the first day of the pre+iousyear 2 or

(B in any area within such distance$ not bein3 more than ei3ht 4ilometres$ from the local

limits of any municipality or cantonment board referred to in item (A$ as the /entral

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6o+ernment may$ ha+in3 re3ard to the e#tent of$ and scope for$ urbanisation of that

area and other rele+ant considerations$ specify in this behalf by notification in the

7fficial 6a8ette'

Explanation 1'9or the remo+al of doubts$ it is hereby declared that re+enue deri+ed from land

shall not include and shall be deemed ne+er to ha+e included any income arisin3 from the transfer

of any land referred to in item (a or item (b of sub"clause (iii of clause (14 of this section'

Explanation 2.9or the remo+al of doubts$ it is hereby declared that income deri+ed from any

buildin3 or land referred to in sub"clause (c arisin3 from the use of such buildin3 or land for any

purpose (includin3 lettin3 for residential purpose or for the purpose of any business or profession

other than a3riculture fallin3 under sub"clause (a or sub"clause (b shall not be a3ricultural

income'

Explanation 3.9or the purposes of this clause$ any income deri+ed from saplin3s or seedlin3s

3rown in a nursery shall be deemed to be a3ricultural income2

(1B -amal3amation.$ in relation to companies$ means the mer3er of one or more companies with

another company or the mer3er of two or more companies to form one company (the company or

companies which so mer3e bein3 referred to as the amal3amatin3 company or companies and the

company with which they mer3e or which is formed as a result of the mer3er$ as the amal3amated

company in such a manner that

(i all the property of the amal3amatin3 company or companies immediately before the

amal3amation becomes the property of the amal3amated company by +irtue of the

amal3amation 2

(ii all the liabilities of the amal3amatin3 company or companies immediately before the

amal3amation become the liabilities of the amal3amated company by +irtue of the

amal3amation 2

(iii shareholders holdin3 not less than three"fourths in +alue of the shares in the amal3amatin3

company or companies (other than shares already held therein immediately before the

amal3amation by$ or by a nominee for$ the amal3amated company or its subsidiary becomeshareholders of the amal3amated company by +irtue of the amal3amation$

otherwise than as a result of the ac,uisition of the property of one company by another company

pursuant to the purchase of such property by the other company or as a result of the distribution of

such property to the other company after the windin3 up of the first"mentioned company 2

(1C -!dditional /ommissioner. means a person appointed to be an !dditional /ommissioner of

Income"ta# under sub"section (1 of section 112

(1 -!dditional ;irector. means a person appointed to be an !dditional ;irector of Income"ta# under

sub"section (1 of section 11 2

(2 -annual +alue.$ in relation to any property$ means its annual +alue as determined under section )2

(4 -!ppellate Tribunal. means the !ppellate Tribunal constituted under section

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(c e+ery person who is deemed to be an assessee in default under any pro+ision of this !ct 2

(#A -!ssessin3 7fficer. means the !ssistant /ommissioner or ;eputy /ommissioner or !ssistant

;irector or ;eputy ;irector or the Income"ta# 7fficer who is +ested with the rele+ant 5urisdiction

by +irtue of directions or orders issued under sub"section (1 or sub"section ( of section 1= or

any other pro+ision of this !ct$ and the !dditional /ommissioner or !dditional ;irector or >oint

/ommissioner or >oint ;irector who is directed under clause (b of sub"section (? of that sectionto e#ercise or perform all or any of the powers and functions conferred on$ or assi3ned to$ an

!ssessin3 7fficer under this !ct 2

($ -assessment. includes reassessment 2

(% -assessment year. means the period of twel+e months commencin3 on the 1st day of !pril e+ery

year 2

(%A -!ssistant /ommissioner. means a person appointed to be an !ssistant /ommissioner of Income"

ta# or a ;eputy /ommissioner of Income"ta# under sub"section (1 of section 11 2

(%B -!ssistant ;irector. means a person appointed to be an !ssistant ;irector of Income"ta# under

sub"section (1 of section 112

(1& -a+era3e rate of income"ta#. means the rate arri+ed at by di+idin3 the amount of income"ta#calculated on the total income$ by such total income 2

(11 -bloc4 of assets. means a 3roup of assets fallin3 within a class of assets comprisin3

(a tan3ible assets$ bein3 buildin3s$ machinery$ plant or furniture2

(b intan3ible assets$ bein3 4now"how$ patents$ copyri3hts$ trade"mar4s$ licences$ franchises or

any other business or commercial ri3hts of similar nature$

in respect of which the same percenta3e of depreciation is prescribed 2

(12 -Board. means the /entral Board of ;irect Ta#es constituted under the /entral Boards of

Re+enue !ct$ 1%&) (

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(iii a3ricultural land in India$ not bein3 land situate

(a in any area which is comprised within the 5urisdiction of a municipality (whether 4nown as

a municipality$ municipal corporation$ notified area committee$ town area committee$ town

committee$ or by any other name or a cantonment board and which has a population of not

less than ten thousand accordin3 to the last precedin3 census of which the rele+ant fi3ures

ha+e been published before the first day of the pre+ious year 2 or(b in any area within such distance$ not bein3 more than ei3ht 4ilometres$ from the local

limits of any municipality or cantonment board referred to in item (a$ as the /entral

6o+ernment may$ ha+in3 re3ard to the e#tent of$ and scope for$ urbanisation of that area

and other rele+ant considerations$ specify in this behalf by notification in the 7fficial

6a8ette

(i( &@ per cent 6old Bonds$ 1%$or per cent 6old Bonds$ 1%A=$or ational ;efence 6old

Bonds$ 1%A=$issued by the /entral 6o+ernment 2

(( *pecial Bearer Bonds$ 1%%1$ issued by the /entral 6o+ernment 2

((i 6old ;eposit Bonds issued under the 6old ;eposit *cheme$ 1%%% notified by the /entral

6o+ernment 2E#planation')or the remo(al o' doubts* it is hereb+ clari'ied that ,propert+, includes and shall

be deemed to ha(e alwa+s included an+ rights in or in relation to an ndian compan+* including

rights o' management or control or an+ other rights whatsoe(er

(1! -charitable purpose. includes relief of the poor$ education$ medical relief$ preser+ation of

en+ironment (includin3 watersheds$ forests and wildlife and preser+ation of monuments or places

or ob5ects of artistic or historic interest$ and the ad+ancement of any other ob5ect of 3eneral public

utility:

Pro&"& that the ad+ancement of any other ob5ect of 3eneral public utility shall not be a

charitable purpose$ if it in+ol+es the carryin3 on of any acti+ity in the nature of trade$ commerce or

business$ or any acti+ity of renderin3 any ser+ice in relation to any trade$ commerce or business$

for a cess or fee or any other consideration$ irrespecti+e of the nature of use or application$ or

retention$ of the income from such acti+ity:

Pro&"& *rth"rthat the first pro+iso shall not apply if the a33re3ate +alue of the receipts from

the acti+ities referred to therein is twent+-'i(e la/h rupeesor less in the pre+ious year2

(1!A -/hief /ommissioner. means a person appointed to be a /hief /ommissioner of Income"ta#

under sub"section (1 of section 11 2

(1!B -child.$ in relation to an indi+idual$ includes a step"child and an adopted child of that indi+idual 2

(1" -/ommissioner. means a person appointed to be a /ommissioner of Income"ta# or a irector o'

ncome-tax under sub"section (1 of section 11 2

(1"A -/ommissioner (!ppeals. means a person appointed to be a /ommissioner of Income"ta#(!ppeals under sub"section (1 of section 11 2

(1# -company. means

(i any Indian company$ or

(ii any body corporate incorporated by or under the laws of a country outside India$ or

(iii any institution$ association or body which is or was assessable or was assessed as a company

for any assessment year under the Indian Income"ta# !ct$ 1% (11 of 1%$ or which is or

was assessable or was assessed under this !ct as a company for any assessment year

commencin3 on or before the 1st day of !pril$ 1%=$ or

(i( any institution$ association or body$ whether incorporated or not and whether Indian or non"

Indian$ which is declared by 3eneral or special order of the Board to be a company :Pro&"&that such institution$ association or body shall be deemed to be a company only for

such assessment year or assessment years (whether commencin3 before the 1st day of !pril$

1%1$ or on or after that date as may be specified in the declaration 2

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(1$ -company in which the public are substantially interested.a company is said to be a company in

which the public are substantially interested

(a if it is a company owned by the 6o+ernment or the Reser+e Ban4 of India or in which not less

than forty per cent of the shares are held (whether sin3ly or ta4en to3ether by the 6o+ernment

or the Reser+e Ban4 of India or a corporation owned by that ban4 2 or

(aa if it is a company which is re3istered under section < of the /ompanies !ct$ 1%

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(i all the property of the underta4in3$ bein3 transferred by the demer3ed company$ immediately

before the demer3er$ becomes the property of the resultin3 company by +irtue of the demer3er2

(ii all the liabilities relatable to the underta4in3$ bein3 transferred by the demer3ed company$

immediately before the demer3er$ become the liabilities of the resultin3 company by +irtue of

the demer3er2

(iii the property and the liabilities of the underta4in3 or underta4in3s bein3 transferred by thedemer3ed company are transferred at +alues appearin3 in its boo4s of account immediately

before the demer3er2

(i( the resultin3 company issues$ in consideration of the demer3er$ its shares to the shareholders of

the demer3ed company on a proportionate basis except where the resulting compan+ itsel' is a

shareholder o' the demerged compan+2

(( the shareholders holdin3 not less than three"fourths in +alue of the shares in the demer3ed

company (other than shares already held therein immediately before the demer3er$ or by a

nominee for$ the resultin3 company or$ its subsidiary become share"holders of the resultin3

company or companies by +irtue of the demer3er$

otherwise than as a result of the ac,uisition of the property or assets of the demer3ed companyor any underta4in3 thereof by the resultin3 company2

((i the transfer of the underta4in3 is on a 3oin3 concern basis2

((ii the demer3er is in accordance with the conditions$ if any$ notified under sub"section (

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(21 -;irector 6eneral or ;irector. means a person appointed to be a ;irector 6eneral of Income"ta#

or$ as the case may be$ a ;irector of Income"ta#$ under sub"section (1 of section 11$ and includes

a person appointed under that sub"section to be an !dditional ;irector of Income"ta# or a >oint

;irector of Income"ta# or an !ssistant ;irector or ;eputy ;irector of Income"ta# 2

(22 -di+idend. includes

(a any distribution by a company of accumulated profits$ whether capitalised or not$ if suchdistribution entails the release by the company to its shareholders of all or any part of the

assets of the company 2

(b any distribution to its shareholders by a company of debentures$ debenture"stoc4$ or deposit

certificates in any form$ whether with or without interest$ and any distribution to its preference

shareholders of shares by way of bonus$ to the e#tent to which the company possesses

accumulated profit$ whether capitalised or not 2

(c any distribution made to the shareholders of a company on its li,uidation$ to the e#tent to

which the distribution is attributable to the accumulated profits of the company immediately

before its li,uidation$ whether capitalised or not 2

(d any distribution to its shareholders by a company on the reduction of its capital$ to the e#tent towhich the company possesses accumulated profits which arose after the end of the pre+ious

year endin3 ne#t before the 1st day of !pril$ 1%))$ whether such accumulated profits ha+e

been capitalised or not 2

(e any payment by a company$ not bein3 a company in which the public are substantially

interested$ of any sum (whether as representin3 a part of the assets of the company or

otherwise made after the )1st day of Cay$ 1%A$ by way of ad+ance or loan to a shareholder$

bein3 a person who is the beneficial owner of shares (not bein3 shares entitled to a fi#ed rate

of di+idend whether with or without a ri3ht to participate in profits holdin3 not less than ten

per cent of the +otin3 power$ or to any concern in which such shareholder is a member or a

partner and in which he has a substantial interest (hereafter in this clause referred to as the said

concern or any payment by any such company on behalf$ or for the indi+idual benefit$ of anysuch shareholder$ to the e#tent to which the company in either case possesses accumulated

profits 2

but -di+idend. does not include

(i a distribution made in accordance with sub"clause (c or sub"clause (d in respect of any share

issued for full cash consideration$ where the holder of the share is not entitled in the e+ent of

li,uidation to participate in the surplus assets 2

(ia a distribution made in accordance with sub"clause (c or sub"clause (d in so far as such

distribution is attributable to the capitalised profits of the company representin3 bonus shares

allotted to its e,uity shareholders after the )1st day of Carch$ 1%&?$ and before the 1st day of

!pril$ 1%&oint ;irector. means a person appointed to be a >oint ;irector of Income"ta# or an !dditional

;irector of Income"ta# under sub"section (1 of section 112

(2% -le3al representati+e. has the meanin3 assi3ned to it in clause (11 of section of the /ode of/i+il Procedure$ 1%=A (< of 1%=A2

(2%A-lon3"term capital asset. means a capital asset which is not a short"term capital asset 2

(2%B -lon3"term capital 3ain. means capital 3ain arisin3 from the transfer of a lon3"term capital asset 2

(2%BA -manufacture.$ with its 3rammatical +ariations$ means a chan3e in a non"li+in3 physical ob5ect or

article or thin3$

(a resultin3 in transformation of the ob5ect or article or thin3 into a new and distinct ob5ect or

article or thin3 ha+in3 a different name$ character and use2 or

(b brin3in3 into e#istence of a new and distinct ob5ect or article or thin3 with a different chemical

composition or inte3ral structure2

(2%C -ma#imum mar3inal rate. means the rate of income"ta# (includin3 surchar3e on income"ta#$ ifany applicable in relation to the hi3hest slab of income in the case of an indi+idual $ association of

persons or$ as the case may be$ body of indi+iduals as specified in the 9inance !ct of the rele+ant

year 2

(2% -ational Ta# Tribunal. means the ational Ta# Tribunal established under section ) of the

ational Ta# Tribunal !ct$ ==

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with or without a ri3ht to participate in profits$ carryin3 not less than twenty per cent of the +otin3

power 2

(33 -prescribed. means prescribed by rules made under this !ct 2

(34 -pre+ious year. means the pre+ious year as defined in section ) 2

(3! -principal officer.$ used with reference to a local authority or a company or any other public body

or any association of persons or any body of indi+iduals$ means(a the secretary$ treasurer$ mana3er or a3ent of the authority$ company$ association or body$ or

(b any person connected with the mana3ement or administration of the local authority$ company$

association or body upon whom the !ssessin3 7fficer has ser+ed a notice of his intention of

treatin3 him as the principal officer thereof 2

(3" -profession. includes +ocation 2

(3"A -public sector company. means any corporation established by or under any /entral$ *tate or

Pro+incial !ct or a 6o+ernment company as defined in section &1 of the /ompanies !ct$ 1%section 11orsection 11

rates of income"ta# specified in this behalf in the 9inance !ct of the rele+ant year$ whiche+er

is applicable 2

(ii for the purposes of deduction of ta# under sections 1%)$ 1%?$ 1%?! $ 1%?B $ 1%?BB and

1%?;$ the rate or rates of income"ta# specified in this behalf in the 9inance !ct of the rele+ant

year 2

(iii for the purposes of deduction of ta# under section 1%

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company in consideration of such transfer of underta4in3$ issues shares to the shareholders of the

demer3ed company and includes any authority or body or local authority or public sector company

or a company established$ constituted or formed as a result of demer3er2

(42 -resident. means a person who is resident in India within the meanin3 of section &2

(42A -short"term capital asset. means a capital asset held by an assessee for not more than thirty"si#

months immediately precedin3 the date of its transfer :Pro&"&that in the case of a share held in a company or any other security listed in a reco3nised

stoc4 e#chan3e in India or a unit of the Jnit Trust of India established under the Jnit Trust of

India !ct$ 1%&) (

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(ii In respect of capital assets other than those mentioned in clause ( i$ the period for which any

capital asset is held by the assessee shall be determined sub5ect to any rules which the Board may

ma4e in this behalf'

Explanation 2.9or the purposes of this clause$ the e#pression -security. shall ha+e the meanin3

assi3ned to it in clause (h of section of the *ecurities /ontracts (Re3ulation !ct$ 1%

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E#planation ')or the remo(al o' doubts* it is hereb+ clari'ied that ,trans'er, includes and shall

be deemed to ha(e alwa+s included disposing o' or parting with an asset or an+ interest therein*

or creating an+ interest in an+ asset in an+ manner whatsoe(er* directl+ or indirectl+* absolutel+ or

conditionall+* (oluntaril+ or in(oluntaril+* b+ wa+ o' an agreement whether entered into in ndia

or outside ndia or otherwise* notwithstanding that such trans'er o' rights has been characterised

as being e''ected or dependent upon or 'lowing 'rom the trans'er o' a share or shares o' a

compan+ registered or incorporated outside ndia

(4$-8ero coupon bond. means a bond

(a issued by any infrastructure capital company or infrastructure capital fund or public sector

company or scheduled ban4 on or after the 1st day of >une$ ==

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(a is recei+ed or is deemed to be recei+ed in India in such year by or on behalf of such person 2 or

(b accrues or arises or is deemed to accrue or arise to him in India durin3 such year'

Explanation 1.Income accruin3 or arisin3 outside India shall not be deemed to be recei+ed in India within

the meanin3 of this section by reason only of the fact that it is ta4en into account in a balance sheet prepared

in India'

Explanation 2.9or the remo+al of doubts$ it is hereby declared that income which has been included in thetotal income of a person on the basis that it has accrued or arisen or is deemed to ha+e accrued or arisen to

him shall not a3ain be so included on the basis that it is recei+ed or deemed to be recei+ed by him in India'

A77orto$("$t o* $'o(" 8"t""$ +7o+"+ o"r$"& 8 Port"+" C! Co&"

.A)(1 Fhere the husband and wife are 3o+erned by the system of community of property (4nown under

the Portu3uese /i+il /ode of 1A&= as - /7CCJI!7 ;7* BE* . in force in the *tate of 6oa and in

the Jnion territories of ;adra and a3ar Da+eli and ;aman and ;iu$ the income of the husband and of the

wife under any head of income shall not be assessed as that of such community of property (whether treated

as an association of persons or a body of indi+iduals$ but such income of the husband and of the wife under

each head of income (other than under the head -*alaries. shall be apportioned e,ually between thehusband and the wife and the income so apportioned shall be included separately in the total income of the

husband and of the wife respecti+ely$ and the remainin3 pro+isions of this !ct shall apply accordin3ly'

( Fhere the husband or$ as the case may be$ the wife 3o+erned by the aforesaid system of community of

property has any income under the head -*alaries.$ such income shall be included in the total income of the

spouse who has actually earned it'

R"+&"$'" $ I$&%

6) 9or the purposes of this !ct$

(1 !n indi+idual is said to be resident in India in any pre+ious year$ if he

(a is in India in that year for a period or periods amountin3 in all to one hundred and ei3hty"two

days or more 2 or

(b

(c ha+in3 within the four years precedin3 that year been in India for a period or periods

amountin3 in all to three hundred and si#ty"fi+e days or more$ is in India for a period or

periods amountin3 in all to si#ty days or more in that year'

Explanation.In the case of an indi+idual$

(a bein3 a citi8en of India$ who lea+es India in any pre+ious year as a member of the crew of an

Indian ship as defined in clause (1$ of section ) of the Cerchant *hippin3 !ct$ 1%

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(4 E+ery other person is said to be resident in India in any pre+ious year in e+ery case$ e#cept where

durin3 that year the control and mana3ement of his affairs is situated wholly outside India'

(! If a person is resident in India in a pre+ious year rele+ant to an assessment year in respect of any

source of income$ he shall be deemed to be resident in India in the pre+ious year rele+ant to the

assessment year in respect of each of his other sources of income'

(" ! person is said to be -not ordinarily resident. in India in any pre+ious year if such person is(a an indi+idual who has been a non"resident in India in nine out of the ten pre+ious years

precedin3 that year$ or has durin3 the se+en pre+ious years precedin3 that year been in India

for a period of$ or periods amountin3 in all to$ se+en hundred and twenty"nine days or less2 or

(b a Dindu undi+ided family whose mana3er has been a non"resident in India in nine out of the

ten pre+ious years precedin3 that year$ or has durin3 the se+en pre+ious years precedin3 that

year been in India for a period of$ or periods amountin3 in all to$ se+en hundred and twenty"

nine days or less'

I$'o(" &""("& to 8" r"'""&)

/) The followin3 incomes shall be deemed to be recei+ed in the pre+ious year :

(i the annual accretion in the pre+ious year to the balance at the credit of an employee participatin3in a reco3nised pro+ident fund$ to the e#tent pro+ided in rule & of Part ! of the 9ourth *chedule 2

(ii the transferred balance in a reco3nised pro+ident fund$ to the e#tent pro+ided in sub"rule (? of

rule 11 of Part ! of the 9ourth *chedule 2

(iii the contribution made$ by the /entral 6o+ernment or any other employer in the pre+ious year$ to

the account of an employee under a pension scheme referred to in section A=//;'

D&"$& $'o(")

) 9or the purposes of inclusion in the total income of an assessee$

(a any di+idend declared by a company or distributed or paid by it within the meanin3 of sub"clause(a or sub"clause (b or sub"clause (c or sub"clause (d or sub"clause (e of clause (22 of section

shall be deemed to be the income of the pre+ious year in which it is so declared$ distributed or

paid$ as the case may be 2

(b any interim di+idend shall be deemed to be the income of the pre+ious year in which the amount

of such di+idend is unconditionally made a+ailable by the company to the member who is entitled

to it'

I$'o(" &""("& to %''r" or %r+" $ I$&%)

9) (1 The followin3 incomes shall be deemed to accrue or arise in India :

(i all income accruin3 or arisin3$ whether directly or indirectly$ throu3h or from any businessconnection in India$ or throu3h or from any property in India$ or throu3h or from any asset or

source of income in India$ or throu3h the transfer of a capital asset situate in India'

Explanation 1'9or the purposes of this clause

(a in the case of a business of which all the operationsare not carried out in India$ the income of

the business deemed under this clause to accrue or arise in India shall be only such part of the

income as is reasonably attributable to the operations carried out in India 2

(b in the case of a non"resident$ no income shall be deemed to accrue or arise in India to him

throu3h or from operations which are confined to the purchase of 3oods in India for the

purpose of e#port 2

(c in the case of a non"resident$ bein3 a person en3a3ed in the business of runnin3 a news a3ency

or of publishin3 newspapers$ ma3a8ines or 5ournals$ no income shall be deemed to accrue or

arise in India to him throu3h or from acti+ities which are confined to the collection of news

and +iews in India for transmission out of India 2

(d in the case of a non"resident$ bein3

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(1 an indi+idual who is not a citi8en of India 2 or

(2 a firm which does not ha+e any partner who is a citi8en of India or who is resident in

India 2 or

(3 a company which does not ha+e any shareholder who is a citi8en of India or who is

resident in India$

no income shall be deemed to accrue or arise in India to such indi+idual$ firm or companythrou3h or from operations which are confined to the shootin3 of any cinemato3raph film in

India'

Explanation 2.9or the remo+al of doubts$ it is hereby declared that -business connection. shall

include any business acti+ity carried out throu3h a person who$ actin3 on behalf of the non"

resident$

(a has and habitually e#ercises in India$ an authority to conclude contracts on behalf of the non"

resident$ unless his acti+ities are limited to the purchase of 3oods or merchandise for the non"

resident2 or

(b has no such authority$ but habitually maintains in India a stoc4 of 3oods or merchandise from

which he re3ularly deli+ers 3oods or merchandise on behalf of the non"resident2 or(c habitually secures orders in India$ mainly or wholly for the non"resident or for that non"

resident and other non"residents controllin3$ controlled by$ or sub5ect to the same common

control$ as that non"resident:

Pro&"& that such business connection shall not include any business acti+ity carried out throu3h

a bro4er$ 3eneral commission a3ent or any other a3ent ha+in3 an independent status$ if such

bro4er$ 3eneral commission a3ent or any other a3ent ha+in3 an independent status is actin3 in the

ordinary course of his business :

Pro&"& *rth"r that where such bro4er$ 3eneral commission a3ent or any other a3ent wor4s

mainly or wholly on behalf of a non"resident (hereafter in this pro+iso referred to as the principal

non"resident or on behalf of such non"resident and other non"residents which are controlled bythe principal non"resident or ha+e a controllin3 interest in the principal non"resident or are sub5ect

to the same common control as the principal non"resident$ he shall not be deemed to be a bro4er$

3eneral commission a3ent or an a3ent of an independent status'

Explanation 3.Fhere a business is carried on in India throu3h a person referred to in clause ( a

or clause (b or clause (c ofExplanation 2$ only so much of income as is attributable to the

operations carried out in India shall be deemed to accrue or arise in India2

E#planation ?')or the remo(al o' doubts* it is hereb+ clari'ied that the expression ,through,

shall mean and include and shall be deemed to ha(e alwa+s meant and included ,b+ means o',*

,in conseuence o', or ,b+ reason o',.

E#planation

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(i the transfer of all or any ri3hts (includin3 the 3rantin3 of a licence in respect of a patent$

in+ention$ model$ desi3n$ secret formula or process or trade mar4 or similar property 2

(ii the impartin3 of any information concernin3 the wor4in3 of$ or the use of$ a patent$ in+ention$

model$ desi3n$ secret formula or process or trade mar4 or similar property 2

(iii the use of any patent$ in+ention$ model$ desi3n$ secret formula or process or trade mar4 or

similar property 2(i( the impartin3 of any information concernin3 technical$ industrial$ commercial or scientific

4nowled3e$ e#perience or s4ill 2

(i(a the use or ri3ht to use any industrial$ commercial or scientific e,uipment but not includin3 the

amounts referred to in section ??BB2

(( the transfer of all or any ri3hts (includin3 the 3rantin3 of a licence in respect of any copyri3ht$

literary$ artistic or scientific wor4 includin3 films or +ideo tapes for use in connection with

tele+ision or tapes for use in connection with radio broadcastin3$ but not includin3

consideration for the sale$ distribution or e#hibition of cinemato3raphic films 2 or

((i the renderin3 of any ser+ices in connection with the acti+ities referred to in sub"clauses ( i to

(i($ (i(a and (('Explanation 3.9or the purposes of this clause$ -computer software. means any computer

pro3ramme recorded on any disc$ tape$ perforated media or other information stora3e de+ice and

includes any such pro3ramme or any customi8ed electronic data2

E#planation ?')or the remo(al o' doubts* it is hereb+ clari'ied that the trans'er o' all or an+

rights in respect o' an+ right* propert+ or in'ormation includes and has alwa+s included trans'er o'

all or an+ right 'or use or right to use a computer so'tware including granting o' a licence

irrespecti(e o' the medium through which such right is trans'erred.

E#planation

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Explanation 1.9or the purposes of the fore3oin3 pro+iso$ an a3reement made on or after the 1st

day of !pril$ 1%&$ shall be deemed to ha+e been made before that date if the a3reement is made in

accordance with proposals appro+ed by the /entral 6o+ernment before that date'

Explanation 2 .9or the purposes of this clause$ -fees for technical ser+ices. means any

consideration (includin3 any lump sum consi"deration for the renderin3 of any mana3erial$

technical or consultancy ser+ices (includin3 the pro+ision of ser+ices of technical or otherpersonnel but does not include consideration for any construction$ assembly$ minin3 or li4e

pro5ect underta4en by the recipient or consideration which would be income of the recipient

char3eable under the head -*alaries.'

( otwithstandin3 anythin3 contained in sub"section (1$ any pension payable outside India to a person

residin3 permanently outside India shall not be deemed to accrue or arise in India$ if the pension is payable

to a person referred to in article )1? of the /onstitution or to a person who$ ha+in3 been appointed before

the 1ud3e of the 9ederal /ourt or of a Di3h /ourt within the meanin3 of

the 6o+ernment of India !ct$ 1%)ud3e in India'

Explanation.9or the remo+al of doubts$ it is hereby declared that for the purposes of this section$ income

of a non"resident shall be deemed to accrue or arise in India under clause ( ( or clause ((i or clause ((ii ofsub"section (1 and shall be included in the total income of the non"resident$ whether or not$

(i the non"resident has a residence or place of business or business connection in India2 or

(ii the non"resident has rendered ser+ices in India'

CHAPTER III

INCOMES :IC DO NOT FORM PART OF TOTAL INCOME

I$'o("+ $ot $'!&"& $ tot%! $'o(")

10)In computin3 the total income of a pre+ious year of any person$ any income fallin3 within any of the

followin3 clauses shall not be included

(1 a3ricultural income 2

(2 sub5ect to the pro+isions of sub"section ( of section &?$ any sum recei+ed by an indi+idual as a

member of a Dindu undi+ided family$ where such sum has been paid out of the income of the

family$ or$ in the case of any impartible estate$ where such sum has been paid out of the income of

the estate belon3in3 to the family 2

(2A in the case of a person bein3 a partner of a firm which is separately assessed as such$ his share in

the total income of the firm'

Explanation.9or the purposes of this clause$ the share of a partner in the total income of a firm

separately assessed as such shall$ notwithstandin3 anythin3 contained in any other law$ be an

amount which bears to the total income of the firm the same proportion as the amount of his share

in the profits of the firm in accordance with the partnership deed bears to such profits 2

(4(i in the case of a non"resident$ any income by way of interest on such securities or bonds as the

/entral 6o+ernment may$ by notification in the 7fficial 6a8ette$ specify in this behalf$ includin3

income by way of premium on the redemption of such bonds :

Pro&"&that the /entral 6o+ernment shall not specify$ for the purposes of this sub"clause$ such

securities or bonds on or after the 1st day of >une$ ==2

(ii in the case of an indi+idual$ any income by way of interest on moneys standin3 to his credit in a

on"Resident (E#ternal !ccount in any ban4 in India in accordance with the 9orei3n E#chan3e

Re3ulation !ct$ 1%) (?& of 1%)$ and the rules made thereunder :

Pro&"&that such indi+idual is a person resident outside India as defined in clause ( of sectionof the said !ct or is a person who has been permitted by the Reser+e Ban4 of India to maintain the

aforesaid !ccount 2

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(4B in the case of an indi+idual$ bein3 a citi8en of India or a person of Indian ori3in$ who is a non"

resident$ any income from interest on such sa+in3s certificates issued before the 1st day of >une$

== by the /entral 6o+ernment as that 6o+ernment may$ by notification in the 7fficial 6a8ette$

specify in this behalf :

Pro&"&that the indi+idual has subscribed to such certificates in con+ertible forei3n e#chan3e

remitted from a country out"side India in accordance with the pro+isions of the 9orei3n E#chan3e

Re3ulation !ct$ 1%) (?& of 1%)$ and any rules made thereunder'

Explanation.9or the purposes of this clause$

(a a person shall be deemed to be of Indian ori3in if he$ or either of his parents or any of his

3randparents$ was born in undi+ided India 2

(b -con+ertible forei3n e#chan3e. means forei3n e#chan3e which is for the time bein3 treated by

the Reser+e Ban4 of India as con+ertible forei3n e#chan3e for the purposes of the 9orei3n

E#chan3e Re3ulation !ct$ 1%) (?& of 1%)$ and any rules made thereunder 2

(! in the case of an indi+idual$ the +alue of any tra+el concession or assistance recei+ed by$ or due to$

him$

(a from his employer for himself and his family$ in connection with his proceedin3 on lea+e to

any place in India 2

(b from his employer or former employer for himself and his family$ in connection with his

proceedin3 to any place in India after retirement from ser+ice or after the termination of his

ser+ice$

sub5ect to such conditions as may be prescribed (includin3 conditions as to number of 5ourneys

and the amount which shall be e#empt per head ha+in3 re3ard to the tra+el concession or

assistance 3ranted to the employees of the /entral 6o+ernment :

Pro&"&that the amount e#empt under this clause shall in no case e#ceed the amount of e#penses

actually incurred for the purpose of such tra+el'

Explanation.9or the purposes of this clause$ -family.$ in relation to an indi+idual$ means

(i the spouse and children of the indi+idual 2 and

(ii the parents$ brothers and sisters of the indi+idual or any of them$ wholly or mainly

dependent on the indi+idual2

(!A mitted b+ the )inance 0o. 2 Act* 1%%$* w.e.'. 1-4-1%%%

(!B mitted b+ the )inance Act* 2&&2* w.e.'. 1-4-2&&3

(" in the case of an indi+idual who is not a citi8en of India$

(ii the remuneration recei+ed by him as an official$ by whate+er name called$ of an embassy$ hi3h

commission$ le3ation$ commission$ consulate or the trade representation of a forei3n *tate$ or

as a member of the staff of any of these officials$ for ser+ice in such capacity :

Pro&"& that the remuneration recei+ed by him as a trade commissioner or other official

representati+e in India of the 6o+ernment of a forei3n *tate (not holdin3 office as such in an

honorary capacity$ or as a member of the staff of any of those officials$ shall be e#empt only

if the remuneration of the corres"pondin3 officials or$ as the case may be$ members of the staff$

if any$ of the 6o+ernment resident for similar purposes in the country concerned en5oys a

similar e#emption in that country :

Pro&"& *rth"rthat such members of the staff are sub5ects of the country represented and

are not en3a3ed in any business or profession or employment in India otherwise than as

members of such staff 2

(iii to (( 5ub-clause ii substituted 'or sub-clauses ii to + b+ the )inance Act* 1%$$* w.e.'. 1-4-1%$%

((i the remuneration recei+ed by him as an employee of a forei3n enterprise for ser+ices renderedby him durin3 his stay in India$ pro+ided the followin3 conditions are fulfilled

(a the forei3n enterprise is not en3a3ed in any trade or business in India 2

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(b his stay in India does not e#ceed in the a33re3ate a period of ninety days in such pre+ious

year 2 and

(c such remuneration is not liable to be deducted from the income of the employer char3eable

under this !ct 2

((ia mitted b+ the )inance 0o. 2 Act* 1%%$* w.e.'. 1-4-1%%%

((ii mitted b+ the )inance Act* 1%%3* w.e.'. 1-4-1%%3((iia mitted b+ the )inance 0o. 2 Act* 1%%$* w.e.'. 1-4-1%%%

((iii any income char3eable under the head -*alaries. recei+ed by or due to any such indi+idual

bein3 a non"resident as remuneration for ser+ices rendered in connection with his employment

on a forei3n ship where his total stay in India does not e#ceed in the a33re3ate a period of

ninety days in the pre+ious year 2

(ix mitted b+ the )inance 0o. 2 Act* 1%%$* w.e.'. 1-4-1%%%

(x mitted b+ the )inance 0o. 2 Act* 1%%$* w.e.'. 1-4-1%%%

(xi the remuneration recei+ed by him as an employee of the 6o+ernment of a forei3n *tate durin3

his stay in India in connection with his trainin3 in any establishment or office of$ or in any

underta4in3 owned by$

(i the 6o+ernment 2 or

(ii any company in which the entire paid"up share capital is held by the /entral 6o+ernment$

or any *tate 6o+ernment or 6o+ernments$ or partly by the /entral 6o+ernment and partly

by one or more *tate 6o+ernments 2 or

(iii any company which is a subsidiary of a company referred to in item (ii 2 or

(i( any corporation established by or under a /entral$ *tate or Pro+incial !ct 2 or

(( any society re3istered under the *ocieties Re3istration !ct$ 1A&= (1? of 1A&=$ or under

any other correspondin3 law for the time bein3 in force and wholly financed by the /entral

6o+ernment$ or any *tate 6o+ernment or *tate 6o+ernments$ or partly by the /entral6o+ernment and partly by one or more *tate 6o+ernments 2

("A where in the case of a forei3n company deri+in3 income by way of royalty or fees for technical

ser+ices recei+ed from 6o+ernment or an Indian concern in pursuance of an a3reement made by

the forei3n company with 6o+ernment or the Indian concern after the )1st day of Carch$ 1%& but

before the 1st day of >une$ == and$

(a where the a3reement relates to a matter included in the industrial policy$ for the time bein3 in

force$ of the 6o+ernment of India$ such a3reement is in accordance with that policy 2 and

(b in any other case$ the a3reement is appro+ed by the /entral 6o+ernment$

the ta# on such income is payable$ under the terms of the a3reement$ by 6o+ernment or the Indian

concern to the /entral 6o+ernment$ the ta# so paidExplanation.9or the purposes of this clause and clause ("B$

(a -fees for technical ser+ices. shall ha+e the same meanin3 as inExplanation 2to clause ((ii of

sub"section (1 of section % 2

(b -forei3n company. shall ha+e the same meanin3 as in section A=B 2

(c -royalty. shall ha+e the same meanin3 as inExplanation 2to clause ((i of sub"section (1 of

section %2

("B where in the case of a non"resident (not bein3 a company or of a forei3n company deri+in3

income (not bein3 salary$ royalty or fees for technical ser+ices from 6o+ernment or an Indian

concern in pur"suance of an a3reement entered into before the 1st day of >une$ == by the /entral

6o+ernment with the 6o+ernment of a forei3n *tate or an international or3anisation$ the ta# onsuch income is payable by 6o+ernment or the Indian concern to the /entral 6o+ernment under the

terms of that a3reement or any other related a3reement appro+ed before that date by the /entral

6o+ernment$ the ta# so paid 2

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("BB where in the case of the 6o+ernment of a forei3n *tate or a forei3n enterprise deri+in3 income

from an Indian company en3a3ed in the business of operation of aircraft$ as a consideration of

ac,uirin3 an aircraft or an aircraft en3ine (other than payment for pro+idin3 spares$ facilities or

ser+ices in connection with the operation of leased aircraft on lease under an a3reement entered

into after the )1st day of Carch$ 1%% but before the 1st day of !pril$ 1%%%$ or entered into after

the )1st day of Carch$ == and appro+ed by the /entral 6o+ernment in this behalf and the ta# on

such income is payable by such Indian company under the terms of that a3reement to the /entral

6o+ernment$ the ta# so paid'

Explanation'9or the purposes of this clause$ the e#pression -forei3n enterprise. means a person

who is a non"resident2

("C any income arisin3 to such forei3n company$ as the /entral 6o+ernment may$ by notification in

the 7fficial 6a8ette$ specify in this behalf$ by way of royalty or fees for technical ser+ices

recei+ed in pursuance of an a3reement entered into with that 6o+ernment for pro+idin3 ser+ices in

or outside India in pro5ects connected with security of India 2

(# any allowances or per,uisites paid or allowed as such outside India by the 6o+ernment to a citi8en

of India for renderin3 ser+ice outside India 2

($ in the case of an indi+idual who is assi3ned to duties in India in connection with any co"operati+e

technical assistance pro3rammes and pro5ects in accordance with an a3reement entered into by the

/entral 6o+ernment and the 6o+ernment of a forei3n *tate (the terms whereof pro+ide for the

e#emption 3i+en by this clause

(a the remuneration recei+ed by him directly or indirectly from the 6o+ernment of that forei3n

*tate for such duties$ and

(b any other income of such indi+idual which accrues or arises outside India$ and is not deemed

to accrue or arise in India$ in respect of which such indi+idual is re,uired to pay any income or

social security ta# to the 6o+ernment of that forei3n *tate 2

($A in the case of a consultant

(a any remuneration or fee recei+ed by him or it$ directly or indirectly$ out of the funds made

a+ailable to an international or3anisation hereafter referred to in this clause and clause ($B as

the a3ency under a technical assistance 3rant a3reement between the a3ency and the

6o+ernment of a forei3n *tate 2 and

(b any other income which accrues or arises to him or it outside India$ and is not deemed to

accrue or arise in India$ in respect of which such consultant is re,uired to pay any income or

social security ta# to the 6o+ernment of the country of his or its ori3in'

Explanation.In this clause$ -consultant. means

(i any indi+idual$ who is either not a citi8en of India or$ bein3 a citi8en of India$ is not ordinarily

resident in India 2 or

(ii any other person$ bein3 a non"resident$

en3a3ed by the a3ency for renderin3 technical ser+ices in India in connection with any technical

assistance pro3ramme or pro5ect$ pro+ided the followin3 conditions are fulfilled$ namely :

(1 the technical assistance is in accordance with an a3reement entered into by the /entral

6o+ernment and the a3ency 2 and

(2 the a3reement relatin3 to the en3a3ement of the consultant is appro+ed by the prescribed

authority for the purposes of this clause 2

($B in the case of an indi+idual who is assi3ned to duties in India in connection with any technical

assistance pro3ramme and pro5ect in accordance with an a3reement entered into by the /entral

6o+ernment and the a3ency(a the remuneration recei+ed by him$ directly or indirectly$ for such duties from any consultant

referred to in clause ($A 2 and

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(b any other income of such indi+idual which accrues or arises outside India$ and is not deemed

to accrue or arise in India$ in respect of which such indi+idual is re,uired to pay any income or

social security ta# to the country of his ori3in$ pro+ided the followin3 conditions are fulfilled$

namely :

(i the indi+idual is an employee of the consultant referred to in clause ($A and is either not a

citi8en of India or$ bein3 a citi8en of India$ is not ordinarily resident in India 2 and(ii the contract of ser+ice of such indi+idual is appro+ed by the prescribed authority before the

commencement of his ser+ice 2

(% the income of any member of the family of any such indi+idual as is referred to in clause ($ or

clause ($A or$ as the case may be$ clause ($B accompanyin3 him to India$ which accrues or arises

outside India$ and is not deemed to accrue or arise in India$ in respect of which such member is

re,uired to pay any income or social security ta# to the 6o+ernment of that forei3n *tate or$ as the

case may be$ country of ori3in of such member

(1& (i any death"cum"retirement 3ratuity recei+ed under the re+ised Pension Rules of the /entral

6o+ernment or$ as the case may be$ the /entral /i+il *er+ices (Pension Rules$ 1%$ or under any

similar scheme applicable to the members of the ci+il ser+ices of the Jnion or holders of posts

connected with defence or of ci+il posts under the Jnion (such members or holders bein3 persons

not 3o+erned by the said Rules or to the members of the all"India ser+ices or to the members of

the ci+il ser+ices of a *tate or holders of ci+il posts under a *tate or to the employees of a local

authority or any payment of retirin3 3ratuity recei+ed under the Pension /ode or Re3ulations

applicable to the members of the defence ser+ices 2

(ii any 3ratuity recei+ed under the Payment of 6ratuity !ct$ 1% ()% of 1%$ to the e#tent it

does not e#ceed an amount calculated in accordance with the pro+isions of sub"sections ( and

() of section ? of that !ct 2

(iii any other 3ratuity recei+ed by an employee on his retirement or on his becomin3 incapacitated

prior to such retirement or on termination of his employment$ or any 3ratuity recei+ed by his

widow$ children or dependants on his death$ to the e#tent it does not$ in either case$ e#ceed one"half monthGs salary for each year of completed ser+ice$ calculated on the basis of the a+era3e

salary for the ten months immediately precedin3 the month in which any such e+ent occurs$

sub5ect to such limit as the /entral 6o+ernment may$ by notification in the 7fficial 6a8ette$

specify in this behalf ha+in3 re3ard to the limit applicable in this behalf to the employees of that

6o+ernment :

Pro&"&that where any 3ratuities referred to in this clause are recei+ed by an employee from

more than one employer in the same pre+ious year$ the a33re3ate amount e#empt from income"ta#

under this clause shall not e#ceed the limit so specified:

Pro&"& *rth"rthat where any such 3ratuity or 3ratuities was or were recei+ed in any one or

more earlier pre+ious years also and the whole or any part of the amount of such 3ratuity or3ratuities was not included in the total income of the assessee of such pre+ious year or years$ the

amount e#empt from income"ta# under this clause shall not e#ceed the limit so specified as

reduced by the amount or$ as the case may be$ the a33re3ate amount not included in the total

income of any such pre+ious year or years'

Explanation.In this clause$ and in clause (1&AA$ -salary. shall ha+e the meanin3 assi3ned to it

in clause (h of rule of Part ! of the 9ourth *chedule 2

(1&A(i any payment in commutation of pension recei+ed under the /i+il Pensions (/ommutation Rules of

the /entral 6o+ernment or under any similar scheme applicable to the members of the ci+il

ser+ices of the Jnion or holders of posts connected with defence or of ci+il posts under the Jnion

(such members or holders bein3 persons not 3o+erned by the said Rules or to the members of the

all"India ser+ices or to the members of the defence ser+ices or to the members of the ci+il ser+ices

of a *tate or holders of ci+il posts under a *tate or to the employees of a local authority or a

corporation established by a /entral$ *tate or Pro+incial !ct 2

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(ii any payment in commutation of pension recei+ed under any scheme of any other employer$ to

the e#tent it does not e#ceed

(a in a case where the employee recei+es any 3ratuity$ the commuted +alue of one"third of the

pension which he is normally entitled to recei+e$ and

(b in any other case$ the commuted +alue of one"half of such pension$

such commuted +alue bein3 determined ha+in3 re3ard to the a3e of the recipient$ the state of hishealth$ the rate of interest and officially reco3nised tables of mortality 2

(iii any payment in commutation of pension recei+ed from a fund under clause (23AAB 2

(1&AA (i any payment recei+ed by an employee of the /entral 6o+ernment or a *tate 6o+ernment as the

cash e,ui+alent of the lea+e salary in respect of the period of earned lea+e at his credit at the time

of his retirement whether on superannuation or otherwise 2

(ii any payment of the nature referred to in sub"clause ( i recei+ed by an employee$ other than an

employee of the /entral 6o+ernment or a *tate 6o+ernment$ in respect of so much of the period

of earned lea+e at his credit at the time of his retirement whether on superannuation or otherwise

as does not e#ceed ten months$ calculated on the basis of the a+era3e salary drawn by the

employee durin3 the period of ten months immediately precedin3 his retirement whether on

superannuation or otherwise$ sub5ect to such limit as the /entral 6o+ernment may$ by notification

in the 7fficial 6a8ette$ specify in this behalf ha+in3 re3ard to the limit applicable in this behalf to

the employees of that 6o+ernment :

Pro&"& that where any such payments are recei+ed by an employee from more than one

employer in the same pre+ious year$ the a33re3ate amount e#empt from income"ta# under this

sub"clause shall not e#ceed the limit so specified :

Pro&"& *rth"rthat where any such payment or payments was or were recei+ed in any one or

more earlier pre+ious years also and the whole or any part of the amount of such payment or

payments was or were not included in the total income of the assessee of such pre+ious year or

years$ the amount e#empt from income"ta# under this sub"clause shall not e#ceed the limit so

specified$ as reduced by the amount or$ as the case may be$ the a33re3ate amount not included inthe total income of any such pre+ious year or years'

Explanation.9or the purposes of sub"clause (ii$

the entitlement to earned lea+e of an employee shall not e#ceed thirty days for e+ery year of actual

ser+ice rendered by him as an employee of the employer from whose ser+ice he has retired 2

(1&B any compensation recei+ed by a wor4man under the Industrial ;isputes !ct$ 1%? (1? of 1%?$ or

under any other !ct or Rules$ orders or notifications issued thereunder or under any standin3

orders or under any award$ contract of ser+ice or otherwise$ at the time of his retrenchment :

Pro&"&that the amount e#empt under this clause shall not e#ceed

(i an amount calculated in accordance with the pro+isions of clause (b of section

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termination of ser+ice or +oluntary separation$ no e#emption under this clause shall be allowed to

him in relation to such$ or any other$ assessment year2

(1&CC in the case of an employee$ bein3 an indi+idual deri+in3 income in the nature of a per,uisite$ not

pro+ided for by way of monetary payment$ within the meanin3 of clause (2 of section 1$ the ta#

on such income actually paid by his employer$ at the option of the employer$ on behalf of such

employee$ notwithstandin3 anythin3 contained in section == of the /ompanies !ct$ 1%

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(13Aany special allowance specifically 3ranted to an assessee by his employer to meet e#penditure actually

incurred on payment of rent (by whate+er name called in respect of residential accommodation

occupied by the assessee$ to such e#tent as may be prescribed ha+in3 re3ard to the area or place in

which such accommodation is situate and other rele+ant considerations'

Explanation.9or the remo+al of doubts$ it is hereby declared that nothin3 contained in this

clause shall apply in a case where(a the residential accommodation occupied by the assessee is owned by him 2 or

(b the assessee has not actually incurred e#penditure on payment of rent (by whate+er name

called in respect of the residential accommodation occupied by him 2

(14 (i any such special allowance or benefit$ not bein3 in the nature of a per,uisite within the meanin3

of clause (2 of section 1$ specifically 3ranted to meet e#penses wholly$ necessarily and

e#clusi+ely incurred in the performance of the duties of an office or employment of profit$ as may

be prescribed$ to the e#tent to which such e#penses are actually incurred for that purpose 2

(ii any such allowance 3ranted to the assessee either to meet his personal e#penses at the place

where the duties of his office or employment of profit are ordinarily performed by him or at the

place where he ordinarily resides$ or to compensate him for the increased cost of li+in3$ as may beprescribed and to the e#tent as may be prescribed:

Pro&"& that nothin3 in sub"clause (ii shall apply to any allowance in the nature of personal

allowance 3ranted to the assessee to remunerate or compensate him for performin3 duties of a

special nature relatin3 to his office or employment unless such allowance is related to the place of

his postin3 or residence 2

(1! (i income by way of interest$ premium on redemption or other payment on such securities$ bonds$

annuity certificates$ sa+in3s certificates$ other certificates issued by the /entral 6o+ernment and

deposits as the /entral 6o+ernment may$ by notification in the 7fficial 6a8ette$ specify in this

behalf$ sub5ect to such conditions and limits as may be specified in the said notification 2

(iib in the case of an indi+idual or a Dindu undi+ided family$ interest on such /apital In+estmentBonds as the /entral 6o+ernment may$ by notification in the 7fficial 6a8ette$ specify in this

behalf :

Pro&"&that the /entral 6o+ernment shall not specify$ for the purposes of this sub"clause$ such

/apital In+estment Bonds on or after the 1st day of >une$ ==2

(iic in the case of an indi+idual or a Dindu undi+ided family$ interest on such Relief Bondsas the

/entral 6o+ernment may$ by notification in the 7fficial 6a8ette$ specify in this behalf 2

(iid interest on such bonds$ as the /entral 6o+ernment may$ by notification in the 7fficial

6a8ette$ specify$ arisin3 to

(a a non"resident Indian$ bein3 an indi+idual ownin3 the bonds 2 or

(b any indi+idual ownin3 the bonds by +irtue of bein3 a nominee or sur+i+or of the non"residentIndian 2 or

(c any indi+idual to whom the bonds ha+e been 3ifted by the non"resident Indian :

Pro&"&that the aforesaid bonds are purchased by a non"resident Indian in forei3n e#chan3e and

the interest and principal recei+ed in respect of such bonds$ whether on their maturity or

otherwise$ is not allowable to be ta4en out of India :

Pro&"& *rth"rthat where an indi+idual$ who is a non"resident Indian in any pre+ious year in

which the bonds are ac,uired$ becomes a resident in India in any subse,uent year$ the pro+isions

of this sub"clause shall continue to apply in relation to such indi+idual :

Pro&"& %!+o that in a case where the bonds are encashed in a pre+ious year prior to their

maturity by an indi+idual who is so entitled$ the pro+isions of this sub"clause shall not apply tosuch indi+idual in relation to the assessment year rele+ant to such pre+ious year :

Pro&"& %!+othat the /entral 6o+ernment shall not specify$ for the purposes of this sub"clause$

such bonds on or after the 1st day of >une$ ==

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Explanation.9or the purposes of this sub"clause$ the e#pression -non"resident Indian. shall ha+e

the meanin3 assi3ned to it in clause (e of section 11

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(e by any other financial institution established in India or a ban4in3 company to which the

Ban4in3 Re3ulation !ct$ 1%?% (1= of 1%?%$ applies (includin3 any ban4 or ban4in3

institution referred to in section une$ ==1 under a loan a3reement appro+ed by

the /entral 6o+ernment where the moneys are borrowed either for the purpose of

ad+ancin3 loans to industrial underta4in3s in India for purchase outside India of raw

materials or capital plant and machinery or for the purpose of importin3 any 3oods which

the /entral 6o+ernment may consider necessary to import in the public interest$ to the

e#tent to which such interest does not e#ceed the amount of interest calculated at the rate

appro+ed by the /entral 6o+ernment in this behalf$ ha+in3 re3ard to the terms of the loan

and its repayment2

(' by an industrial underta4in3 in India on any moneys borrowed by it in forei3n currency

from sources outside India under a loan a3reement appro+ed by the /entral 6o+ernment

before the 1st day of >une$ ==1ha+in3 re3ard to the need for industrial de+elopment in

India$ to the e#tent to which such interest does not e#ceed the amount of interest calculated

at the rate appro+ed by the /entral 6o+ernment in this behalf$ ha+in3 re3ard to the terms

of the loan and its repayment2('a by a scheduled ban4 to a non"resident or to a person who is not ordinarily resident within

the meanin3 of sub"section (& of section & on deposits in forei3n currency where the

acceptance of such deposits by the ban4 is appro+ed by the Reser+e Ban4 of India'

Explanation.9or the purposes of this item$ the e#pression -scheduled ban4. means the

*tate Ban4 of India constituted under the *tate Ban4 of India !ct$ 1%

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(aa the manufacture of computer software or recordin3 of pro3ramme on any disc$ tape$ perforated

media or other information de+ice2 or

(b the business of 3eneration or distribution of electricity or any other form of power2 or

(ba the business of pro+idin3 telecommunication ser+ices2 or

(c minin32 or

(d the construction of ships2 or

(da the business of ship"brea4in32 or

(e the operation of ships or aircrafts or construction or operation of rail systems'

Explanation 1A.9or the purposes of this sub"clause$ the e#pression -interest. shall not include

interest paid on delayed payment of loan or on default if it is in e#cess of two per cent per annum

o+er the rate of interest payable in terms of such loan'

Explanation 2.9or the purposes of this clause$ the e#pression -interest. includes hed3in3

transaction char3es on account of currency fluctuation2

(( interest on

(a securities held by the Felfare /ommissioner$ Bhopal 6as ictims$ Bhopal$ in the Reser+eBan4Gs *6 !ccount o' *M;D =?A2

(b deposits for the benefit of the +ictims of the Bhopal 3as lea4 disaster held in such account$

with the Reser+e Ban4 of India or with a public sector ban4$ as the /entral 6o+ernment

may$ by notification in the 7fficial 6a8ette$ specify$ whether prospecti+ely or

retrospecti+ely but in no case earlier than the 1st day of !pril$ 1%%? in this behalf'

Explanation.9or the purposes of this sub"clause$ the e#pression -public sector ban4. shall ha+e

the meanin3 assi3ned to it in theExplanationto clause (232

((i interest on 6old ;eposit Bonds issued under the 6old ;eposit *cheme$ 1%%% notified by the

/entral 6o+ernment2

((ii interest on bonds

(a issued by a local authority or by a *tate Pooled 9inance Entity2 and

(b specified by the /entral 6o+ernment by notification in the 7fficial 6a8ette'

Explanation.9or the purposes of this sub"clause$ the e#pression -*tate Pooled 9inance Entity.

shall mean such entity which is set up in accordance with the 3uidelines for the Pooled 9inance

;e+elopment *cheme notified by the /entral 6o+ernment in the Cinistry of Jrban ;e+elopment2

((iii any income by way of interest recei+ed by a non"resident or a person who is not ordinarily

resident$ in India on a deposit made on or after the 1st day of !pril$ ==

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(iii any constituency allowance recei+ed by any person by reason of his membership of any *tate

e3islature under any !ct or rules made by that *tate e3islature2

(1#A any payment made$ whether in cash or in 4ind$

(i in pursuance of any award instituted in the public interest by the /entral 6o+ernment or any

*tate 6o+ernment or instituted by any other body and appro+ed by the /entral 6o+ernment in

this behalf2 or(ii as a reward by the /entral 6o+ernment or any *tate 6o+ernment for such purposes as may be

appro+ed by the /entral 6o+ernment in this behalf in the public interest2

(1$ any income by way of

(i pension recei+ed by an indi+idual who has been in the ser+ice of the /entral 6o+ernment or

*tate 6o+ernment and has been awarded -Param ir /ha4ra. or -Caha ir /ha4ra. or -ir

/ha4ra. or such other 3allantry award as the /entral 6o+ernment may$ by notification in the

7fficial 6a8ette$ specify in this behalf2

(ii family pension recei+ed by any member of the family of an indi+idual referred to in sub"clause

(i'

Explanation.9or the purposes of this clause$ the e#pression -family. shall ha+e the meanin3assi3ned to it in theExplanationto clause (!2

(1$A mitted b+ the )inance 0o. 2 Act* 1%%$* w.e.'. 1-4-1%%%

(1% family pension recei+ed by the widow or children or nominated heirs$ as the case may be$ of a

member of the armed forces (includin3 para"military forces of the Jnion$ where the death of such

member has occurred in the course of operational duties$ in such circumstances and sub5ect to such

conditions$ as may be prescribed2

(1%A the annual +alue of any one palace in the occupation of a Ruler$ bein3 a palace$ the annual +alue

whereof was e#empt from income"ta# before the commencement of the /onstitution (Twenty"

si#th !mendment !ct$ 1%1$ by +irtue of the pro+isions of the Cer3ed *tates (Ta#ation

/oncessions 7rder$ 1%?%$ or the Part B *tates (Ta#ation /oncessions 7rder$ 1%ammu and Hashmir (Ta#ation /oncessions 7rder$ 1%

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(1 the words$ brac4ets$ letters and fi3ure -referred to in clause (a or clause (b of sub"

section (1 read with theExplanationto that sub"section. shall be omitted2

(2 for the words -to charitable or reli3ious purposes.$ the words -for the purposes of

scienti'ic research or research in social science or statistical research . shall be

substituted2

(3 the reference to -!ssessin3 7fficer. in clause (a thereof shall be construed as areference to the -prescribed authority. referred to in clause ( ii or clause iii of sub"

section (1 of section )

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Pro&"& that the news a3ency applies its income or accumulates it for application solely for

collection and distribution of news and does not distribute its income in any manner to its

members:

Pro&"& *rth"rthat any notification issued by the /entral 6o+ernment under this clause shall$

at any one time$ ha+e effect for such assessment year or years$ not e#ceedin3 three assessment

years (includin3 an assessment year or years commencin3 before the date on which such

notification is issued as may be specified in the notification:

Pro&"& %!+o that where the news a3ency has been specified$ by notification$ by the /entral

6o+ernment and subse,uently that 6o+ernment is satisfied that such news a3ency has not applied

or accumulated or distributed its income in accordance with the pro+isions contained in the first

pro+iso$ it may$ at any time after 3i+in3 a reasonable opportunity of showin3 cause$ rescind the

notification and forward a copy of the order rescindin3 the notification to such a3ency and to the

!ssessin3 7fficer2

(23 mitted b+ the )inance Act* 2&&2* w.e.'. 1-4-2&&3

(23A any income (other than income char3eable under the head -Income from house property. or any

income recei+ed for renderin3 any specific ser+ices or income by way of interest or di+idends

deri+ed from its in+estments of an association or institution established in India ha+in3 as itsob5ect the control$ super+ision$ re3ulation or encoura3ement of the profession of law$ medicine$

accountancy$ en3ineerin3 or architecture or such other profession as the /entral 6o+ernment may

specify in this behalf$ from time to time$ by notification in the 7fficial 6a8ette:

Pro&"&that

(i the association or institution applies its income$ or accumulates it for application$ solely to the

ob5ects for which it is established2 and

(ii the association or institution is for the time bein3 appro+ed for the purpose of this clause by

the /entral 6o+ernment by 3eneral or special order:

Pro&"& *rth"r that where the association or institution has been appro+ed by the /entral

6o+ernment and subse,uently that 6o+ernment is satisfied that

(i such association or institution has not applied or accumulated its income in accordance with

the pro+isions contained in the first pro+iso2 or

(ii the acti+ities of the association or institution are not bein3 carried out in accordance with all or

any of the conditions sub5ect to which such association or institution was appro+ed$

it may$ at any time after 3i+in3 a reasonable opportunity of showin3 cause a3ainst the proposed

withdrawal to the concerned association or institution$ by order$ withdraw the appro+al and

forward a copy of the order withdrawin3 the appro+al to such association or institution and to the

!ssessin3 7fficer2

(23AA any income recei+ed by any person on behalf of any Re3imental 9und or on"Public 9undestablished by the armed forces of the Jnion for the welfare of the past and present members of

such forces or their dependants2

(23AAA any income recei+ed by any person on behalf of a fund established$ for such purposes as may be

notified by the Board in the 7fficial 6a8ette$ for the welfare of employees or their dependants and

of which fund such employees are members if such fund fulfils the followin3 conditions$ namely :

(a the fund

(i applies its income or accumulates it for application$ wholly and e#clusi+ely to the ob5ects

for which it is established2 and

(ii in+ests its funds and contributions and other sums recei+ed by it in the forms or modesspecified in sub"section (

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Pro&"&that any such appro+al shall at any one time ha+e effect for such assessment year or

years not e#ceedin3 three assessment years as may be specified in the order of appro+al2

(23AAB any income of a fund$ by whate+er name called$ set up by the ife Insurance /orporation of India

on or after the 1st day of !u3ust$ 1%%& or any other insurer under a pension scheme$

(i to which contribution is made by any person for the purpose of recei+in3 pension from such

fund2(ii which is appro+ed by the /ontroller of Insurance or the Insurance Re3ulatory and

;e+elopment !uthority established under sub"section (1 of section ) of the Insurance

Re3ulatory and ;e+elopment !uthority !ct$ 1%%% (?1 of 1%%%$ as the case may be

Explanation.9or the purposes of this clause$ the e#pression -/ontroller of Insurance. shall ha+e

the meanin3 assi3ned to it in clause (!B of section of the Insurance !ct$ 1%)A (? of 1%)A2

(23B any income of an institution constituted as a public charitable trust or re3istered under the

*ocieties Re3istration !ct$ 1A&= (1 of 1A&=$ or under any law correspondin3 to that !ct in force

in any part of India$ and e#istin3 solely for the de+elopment of 4hadi or +illa3e industries or both$

and not for purposes of profit$ to the e#tent such income is attributable to the business of

production$ sale$ or mar4etin3$ of 4hadi or products of +illa3e industries:Pro&"&that

(i the institution applies its income$ or accumulates it for application$ solely for the de+elopment

of 4hadi or +illa3e industries or both2 and

(ii the institution is$ for the time bein3$ appro+ed for the purpose of this clause by the Hhadi and

illa3e Industries /ommission:

Pro&"& *rth"rthat the /ommission shall not$ at any one time$ 3rant such appro+al for more

than three assessment years be3innin3 with the assessment year ne#t followin3 the financial year

in which it is 3ranted:

Pro&"& %!+o that where the institution has been appro+ed by the Hhadi and illa3e Industries

/ommission and subse,uently that /ommission is satisfied that(i the institution has not applied or accumulated its income in accordance with the pro+isions

contained in the first pro+iso2 or

(ii the acti+ities of the institution are not bein3 carried out in accordance with all or any of the

conditions sub5ect to which such institution was appro+ed$

it may$ at any time after 3i+in3 a reasonable opportunity of showin3 cause a3ainst the proposed

withdrawal to the concerned institution$ by order$ withdraw the appro+al and forward a copy of the

order withdrawin3 the appro+al to such institution and to the !ssessin3 7fficer'

Explanation.9or the purposes of this clause$

(i -Hhadi and illa3e Industries /ommission. means the Hhadi and illa3e Industries

/ommission established under the Hhadi and illa3e Industries /ommission !ct$ 1%

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charitable purposes re3istered as such under the *ocieties Re3istration !ct$ 1A&= (1 of 1A&=$ or

any other law for the time bein3 in force:

Pro&"&that nothin3 in this clause shall be construed to e#empt from ta# the income of any trust$

endowment or society referred to therein2

(23BBB any income of the European Economic /ommunity deri+ed in India by way of interest$ di+idends

or capital 3ains from in+estments made out of its funds under such scheme as the /entral6o+ernment may$ by notification in the 7fficial 6a8ette$ specify in this behalf'

Explanation.9or the purposes of this clause$ -European Economic /ommunity. means the

European Economic /ommunity established by the Treaty of Rome of

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(iiiad any uni+ersity or other educational institution e#istin3 solely for educational purposes and not

for purposes of profit if the a33re3ate annual receipts of such uni+ersity or educational

institution do not e#ceed the amount of annual receipts as may be prescribed2 or

(iiiae any hospital or other institution for the reception and treatment of persons sufferin3 from

illness or mental defecti+eness or for the reception and treatment of persons durin3

con+alescence or of persons re,uirin3 medical attention or rehabilitation$ e#istin3 solely for

philanthropic purposes and not for purposes of profit$ if the a33re3ate annual receipts of such

hospital or institution do not e#ceed the amount of annual receipts as may be prescribed2 or

(i( any other fund or institution established for charitable purposes which may be appro+ed by the

prescribed authority$ ha+in3 re3ard to the ob5ects of the fund or institution and its importance

throu3hout India or throu3hout any *tate or *tates2 or

(( any trust (includin3 any other le3al obli3ation or institution wholly for public reli3ious

purposes or wholly for public reli3ious and charitable purposes$ which may be appro+ed by the

prescribed authority$ ha+in3 re3ard to the manner in which the affairs of the trust or institution

are administered and super+ised for ensurin3 that the income accruin3 thereto is properly

applied for the ob5ects thereof2

((i any uni+ersity or other educational institution e#istin3 solely for educational purposes and notfor purposes of profit$ other than those mentioned in sub"clause ( iiiab or sub"clause (iiiad

and which may be appro+ed by the prescribed authority2 or

((ia any hospital or other institution for the reception and treatment of persons sufferin3 from

illness or mental defecti+eness or for the reception and treatment of persons durin3

con+alescence or of persons re,uirin3 medical attention or rehabilitation$ e#istin3 solely for

philanthropic purposes and not for purposes of profit$ other than those mentioned in sub"clause

(iiiac or sub"clause (iiiae and which may be appro+ed by the prescribed autho"rity :

Pro&"&that the fund or trust or institution or any uni+ersity or other educational institution or

any hospital or other medical institution referred to in sub"clause ( i( or sub"clause (( or sub"

clause ((i or sub"clause ((ia shall ma4e an application in the prescribed form and manner to theprescribed authority for the purpose of 3rant of the e#emption$ or continuance thereof$ under sub"

clause (i( or sub"clause (( or sub"clause ((i or sub"clause ((ia :

Pro&"& *rth"rthat the prescribed authority$ before appro+in3 any fund or trust or institution or

any uni+ersity or other educational institution or any hospital or other medical institution$ under

sub"clause (i( or sub"clause (( or sub"clause ((i or sub"clause ((ia$ may call for such

documents (includin3 audited annual accounts or information from the fund or trust or institution

or any uni+ersity or other educational institution or any hospital or other medical institution$ as the

case may be$ as it thin4s necessary in order to satisfy itself about the 3enuineness of the acti+ities

of such fund or trust or institution or any uni+ersity or other educational institution or any hospital

or other medical institution$ as the case may be$ and the prescribed authority may also ma4e such

in,uiries as it deems necessary in this behalf:

Pro&"& %!+othat the fund or trust or institution or any uni+ersity or other educational institution

or any hospital or other medical institution referred to in sub"clause (i( or sub"clause (( or sub"

clause ((i or sub"clause ((ia

(a applies its income$ or accumulates it for application$ wholly and e#clusi+ely to the ob5ects

for which it is established and in a case where more than fifteen per cent of its income is

accumulated on or after the 1st day of !pril$ ==$ the period of the accumulation of the

amount e#ceedin3 fifteen per cent of its income shall in no case e#ceed fi+e years2 and

(b does not in+est or deposit its funds$ other than

(i any assets held by the fund$ trust or institution or any uni+ersity or other educational

institution or any hospital or other medical institution where such assets form part of

the corpus of the fund$ trust or institution or any uni+ersity or other educational

institution or any hospital or other medical institution as on the 1st day of >une$ 1%)2

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(ia any asset$ bein3 e,uity shares of a public company$ held by any uni+ersity or other

educational institution or any hospital or other medical institution where such assets

form part of the corpus of any uni+ersity or other educational institution or any

hospital or other medical institution as on the 1st day of >une$ 1%%A2

(ii any assets (bein3 debentures issued by$ or on behalf of$ any company or corporation$

ac,uired by the fund$ trust or institution or any uni+ersity or other educationalinstitution or any hospital or other medical institution before the 1st day of Carch$

1%A)2

(iii any accretion to the shares$ formin3 part of the corpus mentioned in sub"clause (i

and sub"clause (ia $ by way of bonus shares allotted to the fund$ trust or institution or

any uni+ersity or other educational institution or any hospital or other medical

institution 2

(i( +oluntary contributions recei+ed and maintained in the form of 5ewellery$ furniture or

any other article as the Board may$ by notification in the 7fficial 6a8ette$ specify$

for any period durin3 the pre+ious year otherwise than in any one or more of the forms or

modes specified in sub"section (

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of the said sub"clauses$ e#ceeds the ma#imum amount which is not char3eable to ta# in any

pre+ious year$ such trust or institution or any uni+ersity or other educational institution or any

hospital or other medical institution shall 3et its accounts audited in respect of that year by an

accountant as defined in theExplanationbelow sub"section ( of section AA and furnish alon3

with the return of income for the rele+ant assessment year$ the report of such audit in the

prescribed form duly si3ned and +erified by such accountant and settin3 forth such particulars as

may be prescribed:

Pro&"& %!+o that any amount of donation recei+ed by the fund or institution in terms of clause

(d of sub"section ( of section A=6 in respect of which accounts of income and e#penditure ha+e

not been rendered to the authority prescribed under clause (( of sub"section (une$ ==& for the purposes of 3rant of e#emption or

continuance thereof$ such application shall be made on or before the )=th day of *eptember of the

rele+ant assessment year from which the e#emption is sou3ht :

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Pro&"& %!+o that any anonymous donation referred to in section 11

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e#chan3e$ the whole of the amount so shared shall be deemed to be the income of the pre+ious

year in which such amount is so shared and shall accordin3ly be char3eable to income"ta#'

Explanation.9or the purposes of this clause$ -commodity e#chan3e. shall mean a -re3istered

association. as defined in clause (:: of section of the 9orward /ontracts (Re3ulation !ct$ 1%

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(b -+enture capital company. means such company as has made in+estments by way of ac,uirin3

e,uity shares of +enture capital underta4in3s in accordance with the prescribed 3uidelines2 and

(c -+enture capital underta4in3. means such domestic company whose shares are not listed in a

reco3nised stoc4 e#chan3e in India and which is en3a3ed in the

(i business of

(A software2(B information technolo3y2

(C production of basic dru3s in the pharmaceutical sector2

( bio"technolo3y2

(E a3riculture and allied sectors2 or

() such other sectors as may be notified by the /entral 6o+ernment in this behalf2 or

(ii production or manufacture of any article or substance for which patent has been 3ranted to

the ational Research aboratory or any other scientific research institution appro+ed by

the ;epartment of *cience and Technolo3y2

(23)B any income of a +enture capital company or +enture capital fund from in+estment in a +enture

capital underta4in3'

Explanation 1.9or the purposes of this clause$

(a -+enture capital company. means such company

(i which has been 3ranted a certificate of re3istration under the *ecurities and E#chan3e

Board of India !ct$ 1%% (1< of 1%%$ and re3ulations made thereunder2

(ii which fulfils the conditions as may be specified$ with the appro+al of the /entral

6o+ernment$ by the *ecurities and E#chan3e Board of India$ by notification in the

7fficial 6a8ette$ in this behalf2

(b -+enture capital fund. means such fund

(i operatin3 under a trust deed re3istered under the pro+isions of the Re3istration !ct$

1%=A (1& of 1%=A or operatin3 as a +enture capital scheme made by the Jnit Trust of

India established under the Jnit Trust of India !ct$ 1%&) (

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c ,(enture capital underta/ing, means a (enture capital underta/ing re'erred to in the 5ecurities

and Exchange Board o' ndia

8/9/2019 1-Income Tax Act, 1961

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4.

Explanation 2.In this clause$ references to the district of ada4h shall be construed as references

to the areas comprised in the said district on the )=th day of >une$ 1%%2

(2"AAA in case of an indi+idual$ bein3 a *i44imese$ any income which accrues or arises to him

(a from any source in the *tate of *i44im2 or

(b by way of di+idend or interest on securities:

Pro&"&that nothin3 contained in this clause shall apply to a *i44imese woman who$ on or afterthe 1st day of !pril$ ==A$ marries an indi+idual who is not a *i44imese'

Explanation.9or the purposes of this clause$ -*i44imese. shall mean

(i an indi+idual$ whose name is recorded in the re3ister maintained under the *i4