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CMA Final · Direct Tax Laws and International Taxation · Assessment of Individuals including Non-residents

Ms Anjali, a person of Indian origin who is not a citizen of India, lives abroad. She visits India for 130 days in the tax year. Her total income for the year, other than income from foreign sources, is Rs. 18 lakh. She was in India for 400 days in the four preceding years and for 2,000 days in the seven preceding years. She was resident in 8 of the 10 preceding years. Her residential status for the year is:

Ms Anjali is resident but not ordinarily resident. The 120-day threshold applies because her non-foreign income exceeds Rs. 15 lakh, and she meets it with 130 days plus 400 days in the preceding four years. Her stay of under 182 days with income above Rs. 15 lakh makes her not ordinarily resident.

  1. ANon-resident
  2. BResident but not ordinarily residentCorrect
  3. CResident and ordinarily resident
  4. DResident under section 6(7) as a deemed resident

Explanation

On a visit, with Indian-origin status and non-foreign income above Rs. 15 lakh, the 60-day limit becomes 120 days. She has 130 days, which is at least 120, and 400 days in the four preceding years, which is at least 365, so she is resident under section 6(2)(b). Her stay is below 182 days and her income exceeds Rs. 15 lakh, so she is not ordinarily resident under section 6(13)(b). Section 6(7) applies only to citizens.

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