exemption to Non-Resident, Foreign Company from furnishing Income Tax Return

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The Central Board of Direct Taxes (CBDT) exempts Non-resident and foreign companies from furnishing Income Tax returns subject to some conditions.

In exercise of the powers conferred by sub-section (1C) of section 139 of the Income-tax Act, 1961, the Central Government exempted the class of persons namely a non-resident, not being a company; or a foreign company and non-resident, being an eligible foreign investor subject to the conditions. The non-resident, not being a company; or a foreign company is exempted on the condition that the said class of persons does not earn any income in India, during the previous year, other than the income from investment in the specified fund referred to in sub-clause (i) of clause (c) of Explanation to clause (4D) of section 10 of the said Act; and the provisions of section 139A of the said Act are not applicable to the said class of persons subject to fulfillment of the conditions mentioned in sub-rule (1) of rule 114AAB of the Income-tax Rules, 1962.

The non-resident, being an eligible foreign investor is exempted on the condition that the said class of persons, during the previous year, has made transaction only in capital asset referred to in clause (viiab) of section 47 of the said Act, which is listed on a recognized stock exchange located in any International Financial Services Centre and the consideration on transfer of such capital asset is paid or payable in foreign currency.

The said class of persons does not earn any income in India, during the previous year, other than the income from transfer of capital asset referred to in clause (viiab) of section 47 of the said Act. The provisions of section 139A of the said Act are not applicable to the said class of persons subject to fulfillment of the conditions mentioned in sub-rule (2A) of rule 114AAB of the said rules.

Akshit Gadhia

Author of Tax Concept. Also, he is the Owner of Gadhia  Associate. The author is an avid reader and the author likes to write on various regulatory compliances. Currently, the Author Is pursuing CS, LLB, and ACCA. He has vast experience in Company Law and Roc Filings, Direct and Indirect Tax, Accounts, and Audits, and many other regulatory forms filings.

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