Income from mutual funds for non resident

This query is : Resolved

samir ghosh (Querist)
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05 September 2011 Sir,
A non resident has income from units of mutual fund (purchased in foreign currency)

Whether this income is exempted u/s 10(35)
OR
It is taxable u/s 115A(1)(a)(iii) ?

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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06 September 2011 Any income by way of dividends referred to in S. 115O received by a non-resident is exempt u/s 10(34).

Any income received in respect of units of a Mutual Fund specified u/s 10(23D), or the specified company or an Administrator of the specified undertaking as defined in Sec. 10(35) is exempt u/s 10(35).

Any income arising from the transfer of a long-term capital asset, being an eligible equity share in a company purchased on or after 1st day of March, 2003 and before 1st March, 2004 and held for a period of twelve months or more is exempt u/s 10(36).

Eligible equity share means: –
Any equity share in a company which is a constituent of BSE 500 Index of the Stock Exchange, Mumbai as on the 1st day of March, 2003 and the transaction of purchase and sale of such equity share are entered into on a recognised stock exchange in India;

Any equity share in a company allotted through a public issue on or after the 1st day of March, 2003 and listed in a recognised stock exchange in India before 1st March, 2004.

samir ghosh

samir ghosh (Querist)
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07 September 2011 Mr Agarwal .... my query is still not resolved. Do u mean income from units of mutual fund referred to u/s 10(23D) will be exempted in the hands of a non resident u/s 10(35) ??

Then what about the provisions of sec 115A(1)(a)(iii)??? according to that section the same income is taxable at special rates in the hands of non resident?

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