CMA Intermediate · Direct and Indirect Taxation · Basic Concepts, Basis of Charge and Capital and Revenue Receipts
Bharat Global Pte Ltd is incorporated in Singapore. All its board meetings are held in Singapore, but its key commercial and strategic decisions are in substance taken by its managing director from Pune. What is its residential status in India for the tax year?
Bharat Global Pte Ltd is resident in India. A company is resident if it is an Indian company or its place of effective management is in India. That place is where key commercial and strategic decisions are in substance made, here Pune, regardless of foreign incorporation or board meeting location.
- ANon-resident, because it is not incorporated in India
- BNon-resident, because its board meetings are held outside India
- CResident, because its place of effective management is in IndiaCorrect
- DResident only if it has an Indian subsidiary
Explanation
A company is resident in India if it is an Indian company or if its place of effective management in the tax year is in India. This is the place where key management and commercial decisions necessary for conducting the business are in substance made. Here that place is Pune, so the company is resident despite foreign incorporation and Singapore board meetings.
Did you get it right without looking?
One question tells you little. A timed set on Basic Concepts, Basis of Charge and Capital and Revenue Receipts shows your real accuracy, how long you take and where you lose marks.
More Basic Concepts, Basis of Charge and Capital and Revenue Receipts questions
- Under section 57 of the Income-tax Act, 2025, the straight line method applies to a contract for providing services when:
- Which statement about section 57(3) of the Income-tax Act, 2025 is correct for computing profits under percentage of completion, project com…
- Ms. Kavita Rao is resident in India in the current tax year. She was resident in 3 of the 10 tax years preceding the current year and stayed…
- A non-resident's total income in a tax year consists only of dividend on GDRs covered by section 209(1) (Table: Sl. No. 2) and interest on n…
- Under section 57 of the Income-tax Act, 2025, how is profit determined on a contract for providing services whose duration is 60 days?
- Under section 209, a non-resident has long-term capital gains of ₹10,00,000 on transfer of notified bonds purchased in foreign currency, and…