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CA Intermediate · Taxation · Residential Status and Scope of Total Income

For tax year 2026-27, Arjun Kapoor is resident but not ordinarily resident in India. Which of the following incomes is taxable in India in his hands?

The profit from the German business controlled from Mumbai is taxable. An RNOR is taxed on Indian income and on foreign income only when it comes from a business controlled in India or a profession set up in India. The other incomes are purely foreign.

  1. AInterest earned and received outside India on a foreign deposit made from savings abroad
  2. BRent from a house in London received in London
  3. CProfit from a business in Nepal controlled wholly from Nepal, received in Nepal
  4. DProfit from a business in Germany controlled from Mumbai, received in GermanyCorrect

Explanation

An RNOR is taxed on income received or deemed received in India, accruing in India, and foreign income only if derived from a business controlled in or a profession set up in India. The German business is controlled from Mumbai, so its profit is taxable even though received abroad. The other three are foreign income, not received in India, and not from a business controlled from India.

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