Skip to content

CA Final · Direct Tax Laws & International Taxation · Non Resident Taxation

Under section 174 of the Income-tax Act, 2025, the first mentioned person is deemed to have power to enjoy the income of a non-resident in which of the following situations?

He is deemed to have power to enjoy the non-resident's income when its receipt or accrual increases the value to him of assets he holds or that are held for his benefit. Having a PAN or a low income level does not create such power.

  1. AThe receipt or accrual of the income operates to increase the value to him of any assets held by him or for his benefitCorrect
  2. BHe merely holds a PAN in India
  3. CThe non-resident income is below the basic exemption limit
  4. DHe is a minor beneficiary with no benefit from the income

Explanation

Section 174(6)(c)(ii) deems power to enjoy where receipt or accrual of the income increases the value to that person of assets held by him or for his benefit. Other listed situations include control of application of income, receiving benefits out of the income and power of appointment or revocation. Holding a PAN or the amount of income is irrelevant.

Did you get it right without looking?

One question tells you little. A timed set on Non Resident Taxation shows your real accuracy, how long you take and where you lose marks.

Practise Non Resident TaxationFree diagnostic mock

More Non Resident Taxation questions