This discussion clarifies the taxability of interest earned on Foreign Currency Non-Resident (FCNR) deposits for individuals classified as Resident but Not Ordinarily Resident (RNOR) in India. While income earned outside India is generally not taxable for RNORs, interest on FCNR deposits held with scheduled banks approved by the RBI is indeed taxable. The provision cited, Section 10(15)(iv)(fa), applies to both non-residents and RNORs, confirming the taxability of this specific interest income.
05 February 2021
10(15) (iv)(fa) Interest payable by scheduled bank on deposits in foreign currency where bank accepting such deposits is duly approved by RBI. a) Non-resident b) Individual or HUF being a resident but not ordinary resident