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Report No. 12

9. Income deemed to accrue or arise in India.-

The following incomes shall be deemed to accrue or arise in India-

(i) all income accruing or arising, whether directly or indirectly, through or from any business connection in India, or through or from any property in India, or through or from any asset or source of income in India, or through or from any money lent at interest and brought into India in cash or in kind or through or from the sale, exchange transfer or relinquishment of a capital asset situate in India.

[Section 42(1), main para., earlier half]

Explanation.-In the case of a business of which all the operations are 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.

[Section 42(3)]

(ii) income which falls under the head "Salaries",if it is earned in India:

Provided that any pension payable outside India, to a person residing 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 314 of the Constitution or to a person who, having.been appointed before the 15th day of August, 1947, to be a Judge of the Federal Court or of a High Court within the meaning of the Government of India Act, 1935, continues to serve on or after the commencement of the Constitution as a Judge in India;

[Section 4(1), Expl. 2]

(iii) a dividend paid by an Indian company without India, to the extent to which it has been paid out of profits subjected to income-tax in India.

[Section 4(1), Expl. 3]



Income-Tax Act, 1922 Back




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