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Nri taxation

Ravi (Chief Engineer) (24 Points)

03 June 2016

Is a person who has worked outside of India for 4 months on a Merchant Navy ship of a foreign company (received payments in USD outside of India), and stayed with a relative abroad on holiday, to complete 190 days out of India liable to tax during that financial year?

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mukul jaiswal (Description ) (91 Points)
Replied 03 June 2016

1. Resident (Ordinary Resident) [Section 6(1)]

To determine the residential status of an individual, section 6(1) prescribes two tests. An individual who fulfils any one of the following two tests is called Resident under the provisions of this Act. These tests are :

(a) If he is in India during the relevant previous year for a period amounting in all to 182 days or more.

(b) If he was in India for a period or periods amounting in all to 365 days or more during the four years preceding the relevant previous year and he was in India for a period or periods amounting in all to 60 days or more in that relevant previous year.

The Section also says,

(a) In case of individual being a citizen of India who leaves India in any previous year as a member of the crew of an Indian ship as defined i.n 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 (b) as given above shall apply in relation to that year as if the words “sixty days” have been Substituted by “182 days “.

(b) In case of an individual being a citizen of India, or a person of Indian origin within the meaning of explanation to clause (e) of section 115 C, who being outside India, comes on a visit to India in any previous year, the provisions of sub-clause (b) shall apply in relation to that year as if for he words. ‘Sixty days occurring therein the words One hundred and eighty two days had been substituted.

So the mere fact that you stayed outside india for 190 days does not makes you NRI and does not gives you any relief from taxability in India.

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