36B. (a) Whether the assessee has received any amount for buyback of shares as referred to in sub-clause (f) of clause (22) of section 2? (Yes/No)
(b) If yes, please furnish the following details: (i) Amount received (in Rs.): (ii) Cost of acquisition of shares bought back See Para 54A.11 below Applicability of Clause
Chapter at a glance
[Para 54A.2] [Para 54A.3]
[Para 54A.4] [Para 54A.5] 1128
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2(29C) “maximum
SECTIONS OF INCOME-TAX ACT, 1961
SECTION HEADING
10(3)
10(4) Income by way of interest, premium on redemption or other payment on such securities, bonds, annuity certificates, savings certificates, other certificates issued by the Central Government and deposits
Any income by way of interest
10(4B)
10(4C) Interest on Rupee Denominated Bonds
10(4D) Certain Income arising to Category-III Alternative Investment Fund (AIF) located in International Financial Services Centre (IFSC)
10(4E) Income from transfer of non-deliverable forward contracts or offshore derivative instruments or over-the-counter derivatives
10(4F) Royalty or interest income received by a non-resident from lease of aircraft or a ship
10(4G) Income of a non-resident arising from portfolio of securities or financial products or funds, managed through IFSC or from specified activity carried out by the specified person
10(4H) Any income earned by a non-resident or unit of an IFSC on transfer of shares of domestic company engaged in aircraft leasing business in IFSC
5A) 10(5B)
10(6)(i)
10(6)(ii) Any remuneration received for service in the capacity as an official mentioned in column C, not being a citizen of India
10(6)(iii) to (v)
10(6)(vi) Any remuneration received as an
10(6)(viii) Any
chargeable under the head “Salaries”, received or due as remuneration for services rendered in connection with his employment on a foreign ship
CORRESPONDING SECTIONS OF INCOME-TAX ACT, 2025
IV(1)
6BB)
on behalf of foreign Government or foreign enterprise deriving income by way of lease of aircraft or aircraft engine
VI(2) Sch. VI(3)
Sch. VI(4)
10(6D) Royalty/Fees received by non-resident from National Technical Research Organisation
10(7) Remuneration by Indian Govt. to overseas
10(8) Income of foreign government employee under co-operative technical assistance programme
10(8A) Certain incomes of non-resident consultants engaged by International organizations for Rendering Technical Services in India
10(8B) Certain income of employees of non-resident consultants engaged by International organizations for Rendering Technical Services in India
10(9) Certain incomes of family members of individuals consultants u/s 10(8) or 10(8A) or 10(8B)
10(15)(iid)
SECTION
SECTIONS OF INCOME-TAX ACT, 1961
HEADING
10(34A) Income of a shareholder on account of buyback of shares by the company
10(34B) Dividend income of an IFSC unit engaged in the aircraft leasing business from a company which is also an IFSC Unit engaged in the aircraft leasing business
10(35) Any income arising from the transfer of a capital asset, being a unit of the Unit Scheme, 1964 referred to in Schedule I to the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 (58 of 2002)
10(35A) Income of an investor received from a securitisation trust
10(36) LTCG in case of shares
10(37) Capital gains on compulsory acquisition of urban agricultural land
10(37A) Capital gain on transfer of specified capital assets under land pooling scheme of the Andhra Pradesh Government
10(38) LTCG in case of shares
10(39) Income from international sporting event
10(40) Grants received by specified subsidiary company
10(41)
10(42) Income of
10(
)
10(44) Income of New
10(45)
10(46) Specified income of entities having the object of regulating or administering any activity for the benefit of the general public
10(46A) Income of bodies or authorities or trusts or commissions that are established or constituted with the specific purposes of dealing with and satisfying the need of housing accommodation, planning, development or improvement of cities, towns or villages, regulating or regulating and developing any activity for the benefit of the general public, or regulating any matter, for the benefit of the general public
10(46B)(i) National Credit Guarantee Trustee Company Limited, being a company established and wholly financed by the Central Government for the purposes of operating credit guarantee funds established and wholly financed by the Central Government
10(46B)(ii) A credit guarantee fund established and wholly financed by the Central Government and managed by the National Credit Guarantee Trustee Company Limited
10(46B)(iii) Credit Guarantee Fund Trust for Micro and Small Enterprises, being a trust created by the Central Government and the Small Industries Development Bank of India established under Section 3(1) of the Small Industries Development Bank of India Act, 1989 (39 of 1989)
10(47) Any income of a notified infrastructure debt
10(48) Income on account of import of crude oil etc.
10(48A) Income on account of storage and sale of crude oil
10(48B) Income on account of sale of leftover stock of crude oil
CORRESPONDING SECTIONS OF INCOME-TAX ACT, 2025
SECTION
VII(44)
IV (11)
IV(12)
IV(13)
10(48C) Income on account of replenishment of crude oil Sch. III(37)
10(48D) Any income accruing or arising to an institution established for financing the infrastructure and development
10(48E) Any income accruing or arising to a developmental financing institution, licensed by the RBI
10(49)
10(50) Income which is subject to equalisation levy
10A Special provision in respect of newly established undertakings in free trade zone, etc.
10AA Special provisions in respect of newly established units in Special Economic Zones
10B Special provisions in respect of newly established hundred per cent export-oriented undertakings
10BA Special provisions in respect of export of certain articles or things
10BB Meaning of computer programmes in certain cases
10C Special provision in respect of certain industrial undertakings in North-Eastern Region
33AC Reserves
33B
34 Conditions for depreciation allowance and development rebate
34A Restriction on unabsorbed depreciation and unabsorbed investment allowance for limited period in case of certain domestic companies
35A
35AB
35CCA Expenditure
institutions for carrying
35CCB Expenditure by
and institutions for
provision for computing profits and gains of foreign companies engaged in the business of civil construction, etc., in certain turnkey power projects
44BBC Special provision for computing profits and gains of business of operation of cruise ships in case of non-residents
provision for computing profits and gains of non-residents engaged in business of providing services or technology for setting up an electronics manufacturing facility or in connection with manufacturing or producing electronic goods, article or thing in India
44D Special provisions for computing income by way of royalties, etc., in the case of foreign companies 44DA
54E Capital gain on transfer of capital assets not to be charged in certain cases
54EA Capital gain on transfer of long-term capital assets not to be charged in the case of investment in specified securities
54EB Capital gain on transfer of long-term capital assets not to be charged in certain cases
54ED Capital gain on transfer of certain listed securities or unit not to be charged in certain cases
54EE Capital gain not to be charged on investment in units of a specified fund
54F
80CCF Deduction in respect of subscription to long-term infrastructure bonds
Deduction in respect of profits and gains from newly established industrial undertakings or hotel business in backward areas
80HHA Deduction in respect of profits and gains from newly established small-scale industrial undertakings in certain areas
80HHB Deduction in respect of profits and gains from projects outside India
80HHBA Deduction in respect of profits and gains from housing projects in certain cases
80HHC Deduction in respect of profits retained for export business
80HHD Deduction in respect of earnings in convertible foreign exchange
80HHE Deduction in respect of profits from export of computer software, etc.
80HHF Deduction in respect of profits and gains from export or transfer of film software, etc.
80-I Deduction in respect of profits and gains from industrial undertakings after a certain date, etc.
80-IA Deductions in respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development, etc.
80-IC Special provisions in respect of certain undertakings or enterprises in certain special category States
80-ID Deduction in respect of profits and gains from business of hotels and convention centres in specified area
80PA Deduction in respect of certain income of Producer Companies
80Q Deduction in respect of profits and gains from the business of publication of books
80QQA
in respect of professional income of authors of text books in Indian languages
80R Deduction in respect of remuneration from certain foreign sources in the case of professors, teachers, etc.
80RR Deduction in respect of professional income from foreign sources in certain cases
80RRA Deduction in respect of remuneration received for services rendered outside India
115P
115Q
115QB Interest payable for non-payment of tax by company
115QC When company is deemed to be assessee in default
115R Tax on distributed income to unit holders
115S Interest payable for non-payment of tax
115T Unit Trust of India or Mutual Fund to be an assessee in default
115TA Tax on distributed income to investors 115TB
for
of
115W
115WA
115WB Fringe benefits
115WC Value of fringe benefits
115WD Return of fringe benefits
115WE Assessment
115WF Best judgment assessment
115WG Fringe benefits escaping assessment
115WH Issue of notice where fringe benefits have escaped assessment
115WI Payment of fringe benefit tax
115WJ Advance tax in respect of fringe benefits
115WK Interest for default in furnishing return of fringe benefits
115WKA
115WKB
115WL
245AA Interim Boards for Settlement
245B Income-tax Settlement Commission
245BA Jurisdiction and powers of Settlement Commission
245BB Vice-Chairman to act as Chairman or to discharge his functions in certain circumstances
245BC Power of Chairman to transfer cases from one Bench to another
245BD Decision to be by majority
245C Application for settlement of cases
245D Procedure on receipt of an application under section 245C
245DD Power of Settlement Commission to order provisional attachment to protect revenue
245E Power of Settlement Commission to reopen completed proceedings
245F Powers and procedure of Settlement Commission
245G Inspection, etc., of reports
245H Power of Settlement Commission to grant immunity from prosecution and penalty
245HA Abatement of proceeding before Settlement Commission
245HAA Credit for tax paid in case of abatement of proceedings
245-I Order of settlement to be conclusive
245J Recovery of sums due under order of settlement
245K Bar on subsequent application for settlement
245L Proceedings before Settlement Commission to be judicial proceedings
245M Option to withdraw pending application
245N
245-O Authority for advance
245-OA Qualifications, terms and conditions of service of Chairman, Vice-Chairman and Member
256
268A
269A Definitions
269AB Registration of certain transactions
269B Competent authority
269C Immovable property in respect of which proceedings for acquisition may be taken
269D Preliminary notice
269E Objections
269F Hearing of objections
269G Appeal against order for acquisition
269H Appeal to High Court
269-I Vesting of property in Central Government
269J Compensation
269K Payment or deposit of compensation
269L Assistance by Valuation Officers
269M Powers of competent authority
269N Rectification of mistakes
269-O Appearance by authorised representative or registered valuer
269P Statement to be furnished in respect of transfers of immovable property
269Q Chapter not to apply to transfers to relatives
269R Properties liable for acquisition under this chapter not to be acquired under other laws
269RR Chapter not to apply where transfer of immovable property made after a certain date
269TT Mode of repayment of Special Bearer Bonds, 1991
269U Commencement of Chapter
269UA Definitions
SECTIONS OF INCOME-TAX ACT, 1961
CORRESPONDING SECTIONS OF INCOME-TAX ACT, 2025
SECTION HEADING SECTION
269UB Appropriate authority
269UC Restrictions on transfer of immovable property
269UD Order by appropriate authority for purchase by Central Government of immovable property
269UE Vesting of property in Central Government
269UF Consideration for purchase of immovable property by Central Government
269UG Payment or deposit of consideration
269UH Re-vesting of property in the transferor on failure of payment or deposit of consideration
269UI Powers of the appropriate authority
269UJ Rectification of mistakes
269UK Restrictions on revocation or alteration of certain agreements for the transfer of immovable property or on transfer of certain immovable property
269UL Restrictions on registration, etc., of documents in respect of transfer of immovable property
269UM Immunity to transferor against claims of transferee for transfer
269UN Order of appropriate authority to be final and conclusive
269UO Chapter
269UP
to apply to certain transfers
276A Failure to comply with the provisions of sub-sections (1) and (3) of section 178
276AB Failure to comply with the provisions of sections 269UC, 269UE and 269UL
276B
to the credit of
under Chapter XII-D or XVII-B
Third
SECTIONS OF INCOME-TAX ACT, 1961
CORRESPONDING SECTIONS OF INCOME-TAX ACT, 2025
SECTION HEADING SECTION
Fourth Schedule Part A - Recognised provident funds
Part B - Approved superannuation funds
Part C - Approved gratuity funds
Fifth Schedule List of articles and things
Sixth Schedule
Seventh Schedule Part A - Minerals
Part B - Groups of associated minerals
Eighth Schedule List of industrially backward States and Union Territories
Ninth Schedule
Tenth Schedule
Eleventh Schedule List of articles or things
Twelfth Schedule Processed minerals and ores
Thirteenth Schedule List of articles or things
Part A: For the State of Sikkim
Part B: For the State of Himachal Pradesh and the State of Uttaranchal
Part C: For the State of Jammu and Kashmir
Fourteenth Schedule List of articles or things or operations
Sch. XI Part A 1803
Sch. XI Part C
Sch. XI Part B
Sch. XI Part C
Sch. XI Part B
Sch. XI Part C
XII Part A
XII Part B
XIII
Provisions of the Income-tax Act, 2025 in respect of which there are no corresponding provisions in the Income-tax Act, 1961
Section 9 of the 1961 Act : Income deemed to accrue or arise in India/Section 9 of the 2025 Act : Income deemed to accrue or arise in India
CORRESPONDING PROVISION
Section 9 of the 1961 Act corresponds to section 9 of the 2025 Act as under:— 1961 Act 2025 Act
Section 9(1)
Section 9(1)(i)
Explanation 1(a) to Section 9(1)(i)
Explanation 1(b) to Section 9(1)(i)
Explanation 1(c) to Section 9(1)(i)
Explanation 1(d) to Section 9(1)(i)
Explanation 1(e) to Section 9(1)(i)
Explanation 2 to Section 9(1)(i)
1st Proviso to Explanation 2 to Section 9(1)(i)
2nd Proviso to Explanation 2 to Section 9(1)(i)
Explanation 2A to Section 9(1)(i)
1st Proviso to Explanation 2A to Section 9(1)(i)
2nd Proviso to Explanation 2A to Section 9(1)(i)
3rd Proviso to Explanation 2A to Section 9(1)(i)
Explanation 3 to Section 9(1)(i)
Explanation 3A to Section 9(1)(i) & its proviso
Explanation 4 to Section 9(1)(i)
Explanation 5 to Section 9(1)(i)
1st Proviso to Explanation 5 to Section 9(1)(i)
2nd Proviso to Explanation 5 to Section 9(1)(i)
3rd Proviso to Explanation 5 to Section 9(1)(i)
4th Proviso to Explanation 5 to Section 9(1)(i)
5th Proviso to Explanation 5 to Section 9(1)(i)
6th Proviso to Explanation 5 to Section 9(1)(i)
Explanation to 5th & 6th provisos to
Explanation 5 of Section 9(1)(i)
Explanation 6(a) to Section 9(1)(i)
Explanation 6(b) to Section 9(1)(i)
Explanation 6(c) to Section 9(1)(i) & its 3 provisos
Explanation 6(d) to Section 9(1)(i)
Explanation 7 to Section 9(1)(i)
Explanation 7(a) to Section 9(1)(i)
Explanation 7(b) to Section 9(1)(i)
Explanation 7(c) to Section 9(1)(i)
Section 9(1)(ii) & its Explanation
Section 9(1)(iii)
Section 9(1)(iv)
Section 9(1)
Section 9(2)
Section 9(9)(a) & 9(9)(f)(i) & long line
Section 9(9)(c)(ii)(A)
Section 9(9)(c)(ii)(B)
Section 9(9)(c)(ii)(D)
Section 9(9)(c)(ii)(C)
Section 9(9)(b)(i)
Section 9(9)(c)(i)
Section 9(9)(b)(ii)
Section 9(9)(a)(ii) & 9(9)(d)
Section 9(9)(d), long line
Section 9(9)(e)
Section 9(9)(f)(ii) & long line
Section 9(9)(f)(i)
Section 9(9)(g)
Section 9(13)
Section 9(10)(a)
Section 9(10)(g)(i)(A)
Section 9(10)(g)(i)(B)
Section 9(10)(b)
Section 9(10)(c)
Section 9(10)(e)
Section 9(10)(d)
Section 9(10)
Section 9(10)(g)(ii) & (iii)
Section 9(10)(f)
Section 9(10)(g)(iv)
Section 9(3)(a)
Section 9(3)(b)
Section 9(4)
Section 9(1)(v)
Explanation (a) to Section 9(1)(v)
Explanation (b) to Section 9(1)(v)
Section 9(1)(vi)
1st Proviso to Section 9(1)(vi)
2nd Proviso to Section 9(1)(vi)
Explanation 1 to Section 9(1)(vi)
Explanation 2 to Section 9(1)(vi)
Explanation 3 to Section 9(1)(vi)
Explanation 4 to Section 9(1)(vi)
Explanation 5 to Section 9(1)(vi)
Explanation 6 to Section 9(1)(vi)
Section 9(1)(vii)
1st Proviso to Section 9(1)(vii)
Explanation 1 to Section 9(1)(vii)
Explanation 2 to Section 9(1)(vii)
Section 9(1)(viii)
Section 9(2)
Explanation to Section 9
TEXTUAL COMPARISON
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
(1) 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 the transfer of a capital asset situate in India.
Section 9(5)(a)
Section 9(5)(b)(i) & (ii)
Section 9(5)(b)(iii)
Section 9(6)(a)
Explanation 1 : For the purposes of this clause—
(a) in the case of a business, other than the business having business connection in India on account of significant economic presence, of which all the operations are not carried out in India, the income of the business deemed
Section 9(6)(b)
Section 9(6)(c)(iv)
Section 9(6)(c)(i)
Section 9(6)(c)(ii)
Section 9(6)(c)(iii)
Section 9(7)(a)
Section 9(7)(b)
Section 9(8)
Section 9(11)
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
S. 9(1) The income referred to in sub-sections (2) to (8) shall be deemed to accrue or arise in India.
S. 9(2) The income accruing or arising, directly or indirectly, through or from—
(a) any asset or source of income in India; or
(b) any property in India; or
(c) any business connection in India; or
(d) the transfer of a capital asset situated in India, shall be deemed to accrue or arise in India
S. 9(9)(a) For the purposes of this section, “business connection” in India shall include—
(i) any business carried out in India in the case of which all or part of operation are carried out in India; or
(ii) a significant economic presence in India;
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Section 9 of the 2025 Act : Income deemed to accrue or arise in India 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;
S. 9(9)( f )( i ) and long line (f) in this section, only the income which is reasonably attributable to— (i) operations carried out in India, when all operations of the business are not carried out in India; shall be deemed to accrue or arise in India from any business connection.
(
b) in the case of a non-resident, no income shall be deemed to accrue or arise in India to him through or from operations which are confined to the purchase of goods in India for the purpose of export ;
S. 9(9)(c)(ii) (A)
(c) in clauses (a) and (b), a business carried out in India shall not include any business activity or operations of the non-resident—
(ii) which are confined to any of the following—
(A) the purchase of goods in India for the purposes of export out of India; or
(
c) in the case of a non-resident, being a person engaged in the business of running a news agency or of publishing newspapers, magazines or journals, no income shall be deemed to accrue or arise in India to him through or from activities which are confined to the collection of news and views in India for transmission out of India ;
(d) in the case of a non-resident, being—
(1) an individual who is not a citizen of India ; or
(2) a firm which does not have any partner who is a citizen of India or who is resident in India ; or
(3) a company which does not have any shareholder who is a citizen of India or who is resident in India, no income shall be deemed to accrue or arise in India to such individual, firm or company through or from operations which are confined to the shooting of any cinematograph film in India;
S. 9(9)(c)(ii) (B)
(c) in clauses (a) and (b), a business carried out in India shall not include any business activity or operations of the non-resident—
(ii) which are confined to any of the following—
(B) the collection of news and views in India for transmission out of India, in the case where such non-resident is engaged in the business of running a news agency or of publishing newspapers, magazines or journals; or
S. 9(9)(c)(ii) (D)
(c) in clauses (a) and (b), a business carried out in India shall not include any business activity or operations of the non-resident—
(ii) which are confined to any of the following—
(D) the shooting of any cinematographic film in India, in the case where such non-resident is a person being—
(I) an individual who is not an Indian citizen; or
(II) a firm which does not have a partner who is an Indian citizen or who is resident in India; or
(III) a company which does not have a shareholder who is an Indian citizen or who is resident in India;
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
(e) in the case of a foreign company engaged in the business of mining of diamonds, no income shall be deemed to accrue or arise in India to it through or from the activities which are confined to the display of uncut and unassorted diamond in any special zone notified by the Central Government in the Official Gazette in this behalf
Explanation 2 : For the removal of doubts, it is hereby declared that “business connection” shall include any business activity carried out through a person who, acting on behalf of the non-resident,—
(
a) has and habitually exercises in India, an authority to conclude contracts on behalf of the non-resident or habitually concludes contracts or habitually plays the principal role leading to conclusion of contracts by that non-resident and the contracts are—
(i) in the name of the non-resident; or
(ii) for the transfer of the ownership of, or for the granting of the right to use, property owned by that non-resident or that non-resident has the right to use; or
(iii) for the provision of services by the non-resident; or
(b) has no such authority, but habitually maintains in India a stock of goods or merchandise from which he regularly delivers goods or merchandise on behalf of the non-resident; or
(c) habitually secures orders in India, mainly or wholly for the non-resident or for that non-resident and other non-residents controlling, controlled by, or subject to the same common control, as that non-resident:
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
S. 9(9)(c)(ii) (C) (c) in clauses (a) and (b), a business carried out in India shall not include any business activity or operations of the non-resident—
(ii) which are confined to any of the following—
(
C) the display of uncut and unassorted diamond in any special zone notified by the Central Government, in the case where such non-resident is a foreign company engaged in the business of mining of diamonds; or
S. 9(9)(b)(i) (b) in clause (a), a business carried out in India shall include—
(i) business activity carried out through a person who, acting on behalf of the non-resident,—
(A) has and habitually exercises in India, an authority to conclude contracts on behalf of the non-resident or habitually concludes contracts or habitually plays the principal role leading to conclusion of contracts by that non-resident and the contracts are—
(I) in the name of the non-resident; or
(II) for the transfer of the ownership of, or for the granting of the right to use, property owned by that non-resident or that non-resident has the right to use; or
(III) for the provision of services by the non-resident; or
(B) has no such authority, but habitually maintains in India a stock of goods or merchandise from which he regularly delivers goods or merchandise on behalf of the non-resident; or
(C) habitually secures orders in India, mainly or wholly for the non-resident, or for that non-resident and other non-residents controlling,
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Provided that such business connection shall not include any business activity carried out through a broker, general commission agent or any other agent having an independent status, if such broker, general commission agent or any other agent having an independent status is acting in the ordinary course of his business :
Section 9 of the 2025 Act : Income deemed to accrue or arise in India controlled by, or subject to the same common control, as that non-resident;
S. 9(9)(c)(i) (c) in clauses (a) and (b), a business carried out in India shall not include any business activity or operations of the non-resident
(i) carried out through a broker, general commission agent or any other agent having an independent status, if such broker, general commission agent or any other agent is acting in the ordinary course of his business; or
Provided further that where such broker, general commission agent or any other agent works mainly or wholly on behalf of a non-resident (hereafter in this proviso referred to as the principal non-resident) or on behalf of such non-resident and other non-residents which are controlled by the principal non-resident or have a controlling interest in the principal non-resident or are subject to the same common control as the principal non-resident, he shall not be deemed to be a broker, general commission agent or an agent of an independent status
S. 9(9)(b)(ii) a business activity carried out through a person who is a broker, general commission agent or any other agent, through whom such activity is carried out, and who is working mainly or wholly on behalf of
(A) a non-resident (referred to as the principal non-resident); or
(B) such non-resident and other non-residents who (I) are controlled by the principal non-resident; or
(II) have a controlling interest in the principal non-resident; or
(III) are subject to the same common control as the principal non-resident, and such person shall not be deemed as having an independent status;
Explanation 2A : For the removal of doubts, it is hereby declared that the significant economic presence of a non-resident in India shall constitute “business connection” in India and “significant economic presence” for this purpose, shall mean
(a) transaction in respect of any goods, services or property carried out by a non-resident with any person in India including provision of download of data or software in India, if the aggregate of payments arising from such transaction or transactions during the previous year exceeds such amount as may be prescribed; or
(b) systematic and continuous soliciting of business activities or engaging in interaction with such number of users in India, as may be prescribed:
S. 9(9)(a)(ii) (9)(a) For the purposes of this section, a “business connection” in India shall include
(ii) a significant economic presence in India;
S. 9(9)(d) a non-resident shall have a significant economic presence in India, where there is
(i) transaction in respect of any goods, services or property carried out by such non-resident with any person in India including provision of download of data or software in India, if the aggregate of payments arising from such transaction or transactions during the tax year exceeds such amount as may be prescribed; or
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
(ii) systematic and continuous soliciting of business activities or engaging in interaction with such number of users in India, as may be prescribed,
Provided that the transactions or activities shall constitute significant economic presence in India, whether or not
(i) the agreement for such transactions or activities is entered in India; or
(ii) the non-resident has a residence or place of business in India; or
(iii) the non-resident renders services in India:
Provided further that the transactions or activities which are confined to the purchase of goods in India for the purpose of export shall not constitute significant economic presence in India:
Provided also that only so much of income as is attributable to the transactions or activities referred to in clause (a) or clause (b) shall be deemed to accrue or arise in India.
Explanation 3 : Where a business is carried on in India through a person referred to in clause (a) or clause (b) or clause (c) of Explanation 2, only so much of income as is attributable to the operations carried out in India shall be deemed to accrue or arise in India.
Explanation 3A : For the removal of doubts, it is hereby declared that the income attributable to the operations carried out in India, as referred to in Explanation 1, shall include income from—
(i) such advertisement which targets a customer who resides in India or a customer who accesses the advertisement through internet protocol address located in India;
(ii) sale of data collected from a person who resides in India or from a person who uses internet protocol address located in India; and
(iii) sale of goods or services using data collected from a person who resides in India or from a person who uses internet protocol address located in India:
S. 9(9)( d ), long line irrespective of whether the agreement for such transactions or activities is entered in India, or the non-resident has a residence or place of business in India, or the non-resident renders any services in India;
S. 9(9)(e) the provisions of clause (d) shall not apply to the transactions or activities which are confined to the purchase of goods in India for the purpose of export;
S. 9(9)(f )( ii ) and longline (f) in this section, only the income which is reasonably attributable to— (ii) transactions or activities referred to in clause (d), shall be deemed to accrue or arise in India from any business connection;
S. 9(9)(f)(i) (f) in this section, only the income which is reasonably attributable to— (i) operations carried out in India, when all operations of the business are not carried out in India; shall be deemed to accrue or arise in India from any business connection;
S. 9(9)(g) the income attributable to operations of any business or significant economic presence in this section shall also include income from—
(i) such advertisement which targets a customer who resides in India or a customer who accesses the advertisement through internet protocol address located in India;
(ii) sale of data collected from a person who resides in India or from a person who uses internet protocol address located in India; and
(iii) sale of goods or services using data collected from a person who resides in India or from a person who uses internet protocol address located in India.
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Provided that the provisions contained in this Explanation shall also apply to the income attributable to the transactions or activities referred to in Explanation 2A
Explanation 4 : For the removal of doubts, it is hereby clarified that the expression “through” shall mean and include and shall be deemed to have always meant and included “by means of”, “in consequence of” or “by reason of”.
Explanation 5 : For the removal of doubts, it is hereby clarified that an asset or a capital asset being any share or interest in a company or entity registered or incorporated outside India shall be deemed to be and shall always be deemed to have been situated in India, if the share or interest derives, directly or indirectly, its value substantially from the assets located in India:
Provided that nothing contained in this Explanation shall apply to an asset or capital asset, which is held by a non-resident by way of investment, directly or indirectly, in a Foreign Institutional Investor as referred to in clause (a) of the Explanation to section 115AD for an assessment year commencing on or after the 1st day of April, 2012 but before the 1st day of April, 2015:
Provided further that nothing contained in this Explanation shall apply to an asset or capital asset, which is held by a non-resident by way of investment, directly or indirectly, in Category-I or Category-II foreign portfolio investor under the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014 prior to their repeal, made under the Securities and Exchange Board of India Act, 1992 (15 of 1992):
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
S. 9(13) (13) For the purposes of this section, the expression “through” shall mean and include “by means of”, “in consequence of” or “by reason of”.
S. 9(10)(a) (10) In sub-section (2),— (a) an asset or a capital asset, being any share of, or interest in, a company or entity registered or incorporated outside India shall be deemed to be situated in India, if the share or interest derives, directly or indirectly, its value substantially from the assets (whether tangible or intangible) located in India;
S. 9(10)(g)(i) (A) (g) the income referred to in sub-section (2) shall not include income from transfer, outside India, of any share of, or interest in, a company or an entity registered or incorporated outside India,
(i) if such share of, or interest in, a company or an entity registered or incorporated outside India is held by a non-resident by way of investment, directly or indirectly,— (A) in Category I or Category II foreign portfolio investor under the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014, prior to their repeal, made under the Securities and Exchange Board of India Act, 1992 (15 of 1992);
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Provided also that nothing contained in this Explanation shall apply to an asset or a capital asset, which is held by a non-resident by way of investment, directly or indirectly, in Category-I foreign portfolio investor under the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019, made under the Securities and Exchange Board of India Act, 1992 (15 of 1992):
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
S. 9(10)(g)(i) (B) (g) the income referred to in sub-section (2) shall not include income from transfer, outside India, of any share of, or interest in, a company or an entity registered or incorporated outside India,
(i) if such share of, or interest in, a company or an entity registered or incorporated outside India is held by a non-resident by way of investment, directly or indirectly,— (B) in Category I foreign portfolio investor under the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019, made under the Securities and Exchange Board of India Act, 1992 (15 of 1992);
Provided also that nothing contained in this Explanation shall apply to—
(i) an assessment or reassessment to be made under section 143, section 144, section 147 or section 153A or section 153C; or
(ii) an order to be passed enhancing the assessment or reducing a refund already made or otherwise increasing the liability of the assessee under section 154; or
(iii) an order to be passed deeming a person to be an assessee in default under sub-section (1) of section 201, in respect of income accruing or arising through or from the transfer of an asset or a capital asset situate in India in consequence of the transfer of a share or interest in a company or entity registered or incorporated outside India made before the 28th day of May, 2012:
Provided also that where—
(i) an assessment or reassessment has been made under section 143, section 144, section 147 or section 153A or section 153C; or
(ii) an order has been passed enhancing the assessment or reducing a refund already made or otherwise increasing the liability of the assessee under section 154; or
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
(iii) an order has been passed deeming a person to be an assessee in default under sub-section (1) of section 201; or
(
iv) an order has been passed imposing a penalty under Chapter XXI or under section 221, in respect of income accruing or arising through or from the transfer of an asset or a capital asset situate in India in consequence of the transfer of a share or interest in a company or entity registered or incorporated outside India made before the 28th day of May, 2012 and the person in whose case such assessment or reassessment or order has been passed or made, as the case may be, fulfils the specified conditions, then, such assessment or reassessment or order, to the extent it relates to the said income, shall be deemed never to have been passed or made, as the case may be:
Provided also that where any amount becomes refundable to the person referred to in fifth proviso as a consequence of him fulfilling the specified conditions, then, such amount shall be refunded to him, but no interest under section 244A shall be paid on that amount.
Explanation : For the purposes of fifth and sixth provisos, the specified conditions shall be as provided hereunder:—
(
i) where the said person has filed any appeal before an appellate forum or any writ petition before the High Court or the Supreme Court against any order in respect of said income, he shall either withdraw or submit an undertaking to withdraw such appeal or writ petition, in such form and manner as may be prescribed;
(ii) where the said person has initiated any proceeding for arbitration, conciliation or mediation, or has given any notice thereof under any law for the time being in force or under any agreement entered into by India with any other country or territory outside India, whether for protection of investment or otherwise, he shall either withdraw or shall submit an undertaking to withdraw the claim, if any, in such proceedings or notice,
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Section 9 of the 2025 Act : Income deemed to accrue or arise in India in such form and manner as may be prescribed;
(
iii) the said person shall furnish an undertaking, in such form and manner as may be prescribed, waiving his right, whether direct or indirect, to seek or pursue any remedy or any claim in relation to the said income which may otherwise be available to him under any law for the time being in force, in equity, under any statute or under any agreement entered into by India with any country or territory outside India, whether for protection of investment or otherwise; and
(
iv) such other conditions as may be prescribed.
Explanation 6 : For the purposes of this clause, it is hereby declared that
(
a) the share or interest, referred to in Explanation 5, shall be deemed to derive its value substantially from the assets (whether tangible or intangible) located in India, if, on the specified date, the value of such assets—
(
(
i) exceeds the amount of ten crore rupees; and
ii) represents at least fifty per cent of the value of all the assets owned by the company or entity, as the case may be;
(b) the value of an asset shall be the fair market value as on the specified date, of such asset without reduction of liabilities, if any, in respect of the asset, determined in such manner as may be prescribed;
(
c) “accounting period” means each period of twelve months ending with the 31st day of March:
Provided that where a company or an entity, referred to in Explanation 5, regularly adopts a period of twelve months ending on a day other than the 31st day of March for the purpose of
(i) complying with the provisions of the tax laws of the territory, of which it is a resident, for tax purposes; or
(ii) reporting to persons holding the share or interest,
S. 9(10)(b) (10) In sub-section (2),
(b) the share or interest, referred to in clause (a), shall be deemed to derive its value substantially from the assets (whether tangible or intangible) located in India, if on the specified date, the value of such assets,—
(i) exceeds the amount of ten crore rupees; and
(ii) represents at least 50% of the value of all the assets owned by the company or entity, as the case may be;
S. 9(10)(c) the value of an asset shall be the fair market value on the specified date of such asset without reduction of liabilities, if any, in respect of the asset, determined in the manner, as may be prescribed;
S. 9(10)(e) the expression “accounting period” in clause (d) means—
(i) each period of twelve months ending with the 31st March;
(ii) each period of twelve months ending with a date other than the 31st March, in a case where a company or an entity, referred to in clause (a), regularly adopts a period of twelve months ending on a day other than the 31st March for
(A) complying with the provisions of the tax laws of the territory,
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Section 9 of the 2025 Act : Income deemed to accrue or arise in India then, the period of twelve months ending with the other day shall be the accounting period of the company or, as the case may be, the entity:
Provided further that the first accounting period of the company or, as the case may be, the entity shall begin from the date of its registration or incorporation and end with the 31st day of March or such other day, as the case may be, following the date of such registration or incorporation, and the later accounting period shall be the successive periods of twelve months:
Provided also that if the company or the entity ceases to exist before the end of accounting period, as aforesaid, then, the accounting period shall end immediately before the company or, as the case may be, the entity, ceases to exist;
(d) “specified date” means the—
(i) date on which the accounting period of the company or, as the case may be, the entity ends preceding the date of transfer of a share or an interest; or
(ii) date of transfer, if the book value of the assets of the company or, as the case may be, the entity on the date of transfer exceeds the book value of the assets as on the date referred to in sub-clause (i), by fifteen per cent.
of which it is a resident, for tax purposes; or
(
B) reporting to persons holding the share or interest;
(iii) the period beginning with the date of registration or incorporation of a company or entity and ending with the 31st March or such other day referred to in sub-clause (ii), in a case where a company or entity comes into existence and the later accounting period shall be the successive periods of twelve months; or
(iv) the period beginning with the 1st April or such other day as applicable in sub-clause (ii) and ending with the date immediately preceding the date on which the company or entity ceases to exist, in a case where the company or the entity ceases to exist before the end of the accounting period;
S. 9(10)(d) the expression “specified date” in clause (c) means—
(i) the date on which the accounting period of the company or, as the case may be, the entity ends preceding the date of transfer of a share or an interest; or
(ii) the date of transfer, if the book value of the assets of the company or, as the case may be, the entity on the date of transfer exceeds the book value of the assets as on the date referred to in sub-clause (i), by 15%;
Explanation 7 : For the purposes of this clause, S. 9(10) In sub-section (2),
(a) no income shall be deemed to accrue or arise to a non-resident from transfer, outside India, of any share of, or interest in, a company or an entity, registered or incorporated outside India, referred to in the Explanation 5,
(i) if such company or entity directly owns the assets situated in India and the transferor (whether individually or along with its associated enterprises), at any time in the
S. 9(10)(g)(ii) & (iii)
(g) the income referred to in sub-section (2) shall not include income from transfer, outside India, of any share of, or interest in, a company or an entity registered or incorporated outside India,—
(ii) if such company or entity directly owns the assets situated in India and the transferor (whether individually or along with its associated enterprises), at any time in the
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
twelve months preceding the date of transfer, neither holds the right of management or control in relation to such company or entity, nor holds voting power or share capital or interest exceeding five per cent of the total voting power or total share capital or total interest, as the case may be, of such company or entity; or
(
ii) if such company or entity indirectly owns the assets situated in India and the transferor (whether individually or along with its associated enterprises), at any time in the twelve months preceding the date of transfer, neither holds the right of management or control in relation to such company or entity, nor holds any right in, or in relation to, such company or entity which would entitle him to the right of management or control in the company or entity that directly owns the assets situated in India, nor holds such percentage of voting power or share capital or interest in such company or entity which results in holding of (either individually or along with associated enterprises) a voting power or share capital or interest exceeding five per cent of the total voting power or total share capital or total interest, as the case may be, of the company or entity that directly owns the assets situated in India;
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
twelve months preceding the date of transfer,—
(
A) does not hold the right of management or control in relation to such company or the entity; and
(
B) does not hold voting power or share capital or interest exceeding 5%, of the total voting power or total share capital or total interest, as the case may be, of such company or entity; or
(iii) if such company or entity indirectly owns the assets situated in India and the transferor (whether individually or along with its associated enterprises), at any time in the twelve months preceding the date of transfer,—
(
A) does not hold the right of management or control in relation to such company or the entity;
(
B) does not hold any right in, or in relation to, such company or entity which would entitle it to the right of management or control in the company or entity which directly owns the assets situated in India; and
(
C) does not hold such percentage of voting power or share capital or interest in such company or entity which results in holding of (either individually or along with associated enterprises) a voting power or share capital or interest exceeding 5% of the total voting power or total share capital or total interest, as the case may be, of the company or entity, which directly owns the assets situated in India;
(b) in a case where all the assets owned, directly or indirectly, by a company or, as the case may be, an entity referred to in the Explanation 5, are not located in India, the income of the non-resident transferor, from transfer outside S. 9(10)(f) in case of assets mentioned in clause (a), if
(i) there is a transfer outside India of any share of, or interest in, a company or an entity registered
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
India of a share of, or interest in, such company or entity, deemed to accrue or arise in India under this clause, shall be only such part of the income as is reasonably attributable to assets located in India and determined in such manner as may be prescribed;
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
or incorporated outside India by a non-resident transferor; and
(ii) all the assets owned, directly or indirectly, by that company or entity are not located in India, then the income referred to in sub-section (2) shall be only such part of the income as is reasonably attributable to assets located in India and determined in the manner, as may be prescribed;
(c) “associated enterprise” shall have the meaning assigned to it in section 92A;
(ii) income which falls under the head “Salaries”, if it is earned in India.
Explanation : For the removal of doubts, it is hereby declared that the income of the nature referred to in this clause payable for—
(a) service rendered in India; and
(b) the rest period or leave period which is preceded and succeeded by services rendered in India and forms part of the service contract of employment, shall be regarded as income earned in India ;
(iii) income chargeable under the head “Salaries” payable by the Government to a citizen of India for service outside India ;
S. 9(10)( g ) (iv) in this clause, “associated enterprises” shall have the meaning assigned to it in section 162
S. 9(3)(a) (3) Any income falling under the head “Salaries” shall be deemed to accrue or arise in India, if it is—
(a) earned in India, and any income payable for,—
(i) services rendered in India; and (ii) the rest period or leave period which is preceded and succeeded by services rendered in India and forms part of the service contract of employment, shall be regarded as income earned in India*;
S. 9(3)(b) (3) Any income falling under the head “Salaries” shall be deemed to accrue or arise in India, if it is—
(b) payable by the Government to an Indian citizen for services rendered outside India.
(iv) a dividend paid by an Indian company outside India ; S. 9(4) Any dividend paid by an Indian company outside India shall be deemed to accrue or arise in India.
(v) income by way of interest payable by—
(a) the Government ; or
(b) a person who is a resident, except where the interest is payable in respect of any debt incurred, or moneys borrowed and used, for the purposes of a business or profession carried on by such person outside India or for the purposes of making or earning any income from any source outside India ; or
(c) a person who is a non-resident, where the interest is payable in respect of any
*Words “shall be regarded as income earned in India” be deleted.
S. 9(5)(a) Income by way of interest payable by—
(i) the Government;
(ii) a resident, except where it is payable in respect of any debt incurred, or moneys borrowed and used, for the purpose of—
(A) a business or profession carried on by such resident outside India; or
(B) making or earning any income by such resident from any source outside India; or
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Section 9 of the 2025 Act : Income deemed to accrue or arise in India debt incurred, or moneys borrowed and used, for the purposes of a business or profession carried on by such person in India.
Explanation : For the purposes of this clause,—
(
a) it is hereby declared that in the case of a non-resident, being a person engaged in the business of banking, any interest payable by the permanent establishment in India of such non-resident to the head office or any permanent establishment or any other part of such non-resident outside India shall be deemed to accrue or arise in India and shall be chargeable to tax in addition to any income attributable to the permanent establishment in India and the permanent establishment in India shall be deemed to be a person separate and independent of the non-resident person of which it is a permanent establishment and the provisions of the Act relating to computation of total income, determination of tax and collection and recovery shall apply accordingly;
S. 9(5)( b )( i ) and (ii)
(iii) a non-resident, if it is in respect of any debt incurred, or moneys borrowed and used, for the purposes of a business or profession carried on by such non-resident in India, shall be deemed to accrue or arise in India;
(b) for the purposes of clause (a),—
(i) any interest payable by the permanent establishment in India of a non-resident person engaged in the business of banking, to the head office or any other permanent establishment or any other part of such non-resident outside India shall be deemed to accrue or arise in India and shall be chargeable to tax in addition to any income attributable to such permanent establishment in India;
(ii) such permanent establishment in India shall––
(A) be deemed to be a person separate from, and independent of, the non-resident person of which it is a permanent establishment; and
(B) the provisions of this Act relating to computation of total income, determination of tax and collection and recovery shall apply, accordingly;
(
b) “permanent establishment” shall have the meaning assigned to it in clause (iiia) of section 92F;
(vi) income by way of royalty payable by—
(a) the Government ; or
(
b) a person who is a resident, except where the royalty is payable in respect of any right, property or information used or services utilised for the purposes of a business or profession carried on by such person outside India or for the purposes of making or earning any income from any source outside India ; or
(
c) a person who is a non-resident, where the royalty is payable in respect of any right, property or information used or services utilised for the purposes of a business or
S. 9(5)(b)(iii) (b) for the purposes of clause (a),—
(iii) “permanent establishment” shall have the meaning assigned to it in section 173(c)
S. 9(6)(a) Income by way of royalty payable by—
(i) the Government;
(ii) a resident, except where the royalty is payable in respect of any right, property or information used or services utilised for the purposes of—
(
A) a business or profession carried on by such resident outside India; or
(B) making or earning any income by such resident from any source outside India; or
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Section 9 of the 2025 Act : Income deemed to accrue or arise in India profession carried on by such person in India or for the purposes of making or earning any income from any source in India :
(iii) a non-resident, if the royalty is payable in respect of any right, property or information used or services utilised for the purposes of—
(A) a business or profession carried on by such non-resident in India; or
(B) making or earning any income by such non-resident from any source in India, shall be deemed to accrue or arise in India;
Provided that nothing contained in this clause shall apply in relation to so much of the income by way of royalty as consists of lump sum consideration for the transfer outside India of, or the imparting of information outside India in respect of, any data, documentation, drawing or specification relating to any patent, invention, model, design, secret formula or process or trade mark or similar property, if such income is payable in pursuance of an agreement made before the 1st day of April, 1976, and the agreement is approved by the Central Government :
Provided further that nothing contained in this clause shall apply in relation to so much of the income by way of royalty as consists of lump sum payment made by a person, who is a resident, for the transfer of all or any rights (including the granting of a licence) in respect of computer software supplied by a non-resident manufacturer along with a computer or computer-based equipment under any scheme approved under the Policy on Computer Software Export, Software Development and Training, 1986 of the Government of India
Explanation 1 : For the purposes of the first proviso, an agreement made on or after the 1st day of April, 1976, shall be deemed to have been made before that date if the agreement is made in accordance with proposals approved by the Central Government before that date; so, however, that, where the recipient of the income by way of royalty is a foreign company, the agreement shall not be deemed to have been made before that date unless, before the
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Section 9 of the 2025 Act : Income deemed to accrue or arise in India expiry of the time allowed under sub-section (1) or sub-section (2) of section 139 (whether fixed originally or on extension) for furnishing the return of income for the assessment year commencing on the 1st day of April, 1977, or the assessment year in respect of which such income first becomes chargeable to tax under this Act, whichever assessment year is later, the company exercises an option by furnishing a declaration in writing to the Assessing Officer (such option being final for that assessment year and for every subsequent assessment year) that the agreement may be regarded as an agreement made before the 1st day of April, 1976
Explanation 2 : For the purposes of this clause, “royalty” means consideration (including any lump sum consideration but excluding any consideration which would be the income of the recipient chargeable under the head “Capital gains”) for
(i) the transfer of all or any rights (including the granting of a licence) in respect of a patent, invention, model, design, secret formula or process or trade mark or similar property ;
(ii) the imparting of any information concerning the working of, or the use of, a patent, invention, model, design, secret formula or process or trade mark or similar property ;
(iii) the use of any patent, invention, model, design, secret formula or process or trade mark or similar property ;
(
iv) the imparting of any information concerning technical, industrial, commercial or scientific knowledge, experience or skill;
(
iva) the use or right to use any industrial, commercial or scientific equipment but not including the amounts referred to in section 44BB;
(
v) the transfer of all or any rights (including the granting of a licence) in respect of any copyright, literary, artistic or scientific work including films or video tapes for use in connection with television or tapes for use in connection with radio broadcasting ; or
S. 9(6)(b) in this sub-section, “royalty” means consideration (including any lump-sum consideration but excluding any consideration which would be the income of the recipient chargeable under the head “Capital gains”) for the following
(i) the transfer or grant of all or any rights (including the granting of a licence) in respect of a patent, invention, model, design, secret formula or process or trade mark or similar property;
(ii) the imparting of any information concerning the working of, or the use of, a patent, invention, model, design, secret formula or process or trade mark or similar property;
(iii) the use of any patent, invention, model, design, secret formula or process or trade mark or similar property;
(iv) the imparting of any information concerning technical, industrial, commercial or scientific knowledge, experience or skill;
(v) the use or right to use any industrial, commercial or scientific equipment except the amounts referred in section 61(2) (Table: Sl. No. 5);
(vi) the transfer or grant of all or any rights (including the granting of a licence) in respect of any copyright, literary, artistic or scientific work including—
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
Section 9 of the 2025 Act : Income deemed to accrue or arise in India (vi) the rendering of any services in connection with the activities referred to in sub-clauses (i) to (iv), (iva) and (v)
(A) films or video tapes for use in connection with television; or (B) tapes for use in connection with radio broadcasting; (vii) the rendering of services in connection with the activities referred to in sub-clauses (i) to (vi);
Explanation 3 : For the purposes of this clause, “computer software” means any computer programme recorded on any disc, tape, perforated media or other information storage device and includes any such programme or any customized electronic data.
Explanation 4 : For the removal of doubts, it is hereby clarified that the transfer of all or any rights in respect of any right, property or information includes and has always included transfer of all or any right for use or right to use a computer software (including granting of a licence) irrespective of the medium through which such right is transferred.
Explanation 5 : For the removal of doubts, it is hereby clarified that the royalty includes and has always included consideration in respect of any right, property or information, whether or not—
(a) the possession or control of such right, property or information is with the payer;
(b) such right, property or information is used directly by the payer;
(
c) the location of such right, property or information is in India.
Explanation 6 : For the removal of doubts, it is hereby clarified that the expression “process” includes and shall be deemed to have always included transmission by satellite (including up-linking, amplification, conversion for down-linking of any signal), cable, optic fibre or by any other similar technology, whether or not such process is secret;
(vii) income by way of fees for technical services payable by—
(a) the Government ; or
S. 9(6)(c)(iv) (c) for the purposes of clause (b),— (iv) the expression “computer software” means any computer programme recorded on any disc, tape, perforated media or other information storage device and includes any such programme or any customised electronic data.
S. 9(6)(c)(i) (c) for the purposes of clause (b), (i) the transfer or grant of all or any rights in respect of any right, property or information includes transfer or grant of all or any right for use or right to use a computer software (including granting of a licence) irrespective of the medium through which that right is transferred;
S. 9(6)(c)(ii) royalty includes consideration in respect of any right, property or information, whether or not—
(A) the possession or control of that right, property or information is with the payer;
(B) that right, property or information is used directly by the payer;
(C) the location of that right, property or information is in India;
S. 9(6)(c)(iii) the expression “process” includes transmission by satellite (including up-linking, amplification, conversion for down-linking of any signal), cable, optic fibre or by any other similar technology, whether or not that process is secret;
S. 9(7)(a) Income by way of fees for technical services payable by— (i) the Government;
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
(
b) a person who is a resident, except where the fees are payable in respect of services utilised in a business or profession carried on by such person outside India or for the purposes of making or earning any income from any source outside India; or
(
c) a person who is a non-resident, where the fees are payable in respect of services utilised in a business or profession carried on by such person in India or for the purposes of making or earning any income from any source in India :
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
(ii) a resident, except where it is payable in respect of services utilised for
(
A) a business or profession carried on by such resident outside India; or
(
B) making or earning any income by such resident from any source outside India; or
(iii) a non-resident, if it is payable in respect of services utilised for
(
A) a business or a profession carried on by such non-resident in India; or
(
B) making or earning any income by such non-resident from any source in India, shall be deemed to accrue or arise in India;
Provided that nothing contained in this clause shall apply in relation to any income by way of fees for technical services payable in pursuance of an agreement made before the 1st day of April, 1976, and approved by the Central Government
Explanation 1 : For the purposes of the foregoing proviso, an agreement made on or after the 1st day of April, 1976, shall be deemed to have been made before that date if the agreement is made in accordance with proposals approved by the Central Government before that date
Explanation 2 : For the purposes of this clause, “fees for technical services” means any consideration (including any lump sum consideration) for the rendering of any managerial, technical or consultancy services (including the provision of services of technical or other personnel) but does not include consideration for any construction, assembly, mining or like project undertaken by the recipient or consideration which would be income of the recipient chargeable under the head “Salaries”;
S. 9(7)(b) in this sub-section, “fees for technical services” means any consideration (including any lump sum consideration) for the rendering of any managerial, technical or consultancy services (including the provision of services of technical or other personnel) but does not include consideration—
(i) for any construction, assembly, mining or like project undertaken by the recipient; or
(ii) which would be income of the recipient chargeable under the head “Salaries”.
(viii) income arising outside India, being any sum of money referred to in sub-clause (xviia) of clause (24) of section 2, paid by a person resident in India—
S. 9(8)
Income arising outside India, in the nature of a sum referred to in section 2(49)(u), paid by a person resident in India,—
Section 9 of the 1961 Act : Income deemed to accrue or arise in India
(
a) on or after the 5th day of July, 2019 to a non-resident, not being a company, or to a foreign company; or
(b) on or after the 1st day of April, 2023 to a person not ordinarily resident in India within the meaning of clause (6) of section 6
(2) Notwithstanding anything contained in sub-section (1), 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
Explanation : For the removal of doubts, it is hereby declared that for the purposes of this section, income of a non-resident shall be deemed to accrue or arise in India under clause (v) or clause (vi) or clause (vii) of sub-section (1) and shall be included in the total income of the non-resident, whether or not,—
(i) the non-resident has a residence or place of business or business connection in India; or
(ii) the non-resident has rendered services in India.
ANALYSIS OF CHANGES MADE
Section 9 of the 2025 Act : Income deemed to accrue or arise in India
(a) to a non-resident, not being a company, or to a foreign company; or
(b) to a person not ordinarily resident in India under section 6(13), shall be deemed to accrue or arise in India
S. 9(11) In sub-sections (5), (6) and (7), income of a non-resident shall be deemed to accrue or arise in India and shall be included in his total income, whether or not,—
(a) the non-resident has a residence or place of business or business connection in India; or
(b) the non-resident has rendered services in India.
9.1 Transfer of a capital asset situated in India [Section 9(1)(i)/New section 9(2)(d)]
Under the 1961 Act, the phrase “all income accruing or arising, whether directly or indirectly, through or from” was applicable to the first three income categories and not applicable to the last income category, i.e., “the transfer of a capital asset situate in India”. Thus, all income accruing or arising, whether directly or indirectly, through the transfer of a capital asset situate in India was deemed as accrued or arisen in India.
Under the 2025 Act, the new phrase “any income accruing or arising, directly or indirectly, through or from” is also applicable to the last income category, i.e., “the transfer of a capital asset situated in India”. Thus, any income accruing or arising, directly or indirectly, through or from the transfer of a capital asset situated in India shall also be deemed to accrue or arise in India.
9.2 Attribution of income where all business operations are not carried out in India [Explanation 1(a) to section 9(1)(i)/New section 9(9)(a) and 9(9)(f)(i)]
A business having business connection in India on account of Significant Economic Presence (SEP) is out of purview of Explanation 1(a) under the 1961 Act, but this is not the case in the 2025 Act. The 2025 Act has merged both the provisions.
9.3 Purchase of goods in India for export [Explanation 1(b) to section 9(1)(i)/New section 9(9)(c)(ii)(A)]
Under the 1961 Act, the words used were “purchase of goods in India for the purpose of export”. However, under the 2025 Act, the words used are “purchase of goods in India for the purposes of export out of India”.
Thus, it is now explicitly stated that the export should be out of India, and mere circuitous transportation of goods out of India and subsequent bringing into India would be outside the scope and ambit of the provision. Hence, such a circuitous transportation would not be eligible for exemption from ‘business connection in India’.
9.4 ‘Transfer of all or any rights’ v. ‘Transfer or grant of all or any rights’ [Explanations 2 & 4 to section 9(1)(vi)/New section 9(6)(b) & 9(6)(c)(i)]
Under the 1961 Act, the phrase “the transfer of all or any rights (including the granting of a licence)…” was used in Explanation 2(i) & 2(v) to section 9(1)(vi), whereas the phrase “the transfer of all or any rights” was used in Explanation 4 to section 9(1)(vi).
However, under the 2025 Act, the former phrase has been replaced with the new phrase “the transfer or grant of all or any rights (including the granting of a licence)…”, and the latter phrase has been replaced with the new phrase “the transfer or grant of all or any rights”.
It seems that this insertion of the words “or grant” in the opening portion is to provide more clarity and minimising the possibility of restricting the licence to ‘transfer’ only.
9.4-1 Select Committee - With regard to the above insertion, the Ministry in a written reply before the Select Committee submitted that “Explanation 2 to section 9(1)(vi) of the I T Act used the word ‘transfer’ in general and the word ‘granting’ in the context of a licence. For the purpose of section 9(1)(vi) The ‘royalty’ inter alia means ‘consideration’ in respect of a patent, invention, model, design, secret formula or process or trade mark or similar property. Therefore, the use of word ‘grant’ along with the word ‘transfer’ provides more clarity and minimises probable disputes arising on account of interpretational issues. It also minimises possibilities of restricting it to ‘transfer’ only and removes existing dichotomy in the use of both terms. Therefore, the proposed amendment is not feasible.” Further, the Ministry, during the oral evidence, clarified that “there is a slight drafting change which has been done in the provision - ‘by way of transfer or grant of a license’. That is how it has been used. So, it is just making it more clear. No additional power or additional liability towards taxability of royalty has been taken. Earlier, in the first line, it was written only transfer and consequently, when license was there, ‘by way of grant of license was also there’. So, now, we just consolidate it to two terms.”
See para 3.5 of Taxmann’s Master Guide to Income-tax Act, 2025.
Section 9A of the 1961 Act : Certain activities not to constitute business connection in India/ Section 9 of the 2025 Act : Income deemed to accrue or arise in India/Schedule I of the 2025 Act : Conditions for certain activities not to constitute business connection in India
CORRESPONDING PROVISION
Section 9A of the 1961 Act corresponds to section 9 and Schedule I of the 2025 Act as under:—
1961 Act 2025 Act
Section 9A(1)
Section 9A(2)
Section 9A(3)
Section 9A(3)(a)
Section 9A(3)(b)
Section 9A(3)(c)
1st Proviso to Section 9A(3)(c)
2nd Proviso to Section 9A(3)(c)
Section 9A(3)(d)
Section 9A(3)(e)
Section 9A(3)(f)
Section 9A(3)(g)
Section 9A(3)(h)
Section 9A(3)(i)
Section 9(12)(a)
Section 9(12)(b)
Schedule I, Para 1(1)
Schedule I, Para 1(1)(a)
Schedule I, Para 1(1)(b)
Schedule I, Para 1(1)(c)
Schedule I, Para 1(1)(c)(i)
Schedule I, Para 1(1)(c)(ii)
Schedule I, Para 1(1)(d)
Schedule I, Para 1(1)(e)
Schedule I, Para 1(1)(f)
Schedule I, Para 1(1)(g)
Schedule I, Para 1(1)(h)
Schedule I, Para 1(1)(i)
Rs. 3,395/-
COMPARATIVE STUDY OF PROVISIONS OF INCOME TAX ACT 2025 & INCOME TAX ACT 1961
AUTHOR : Taxmann's Editorial Board
PUBLISHER : Taxmann Publications
DATE OF PUBLICATION : September 2025
EDITION : 2025 Edition
ISBN NO : 9789371265867
BINDING TYPE : PAPERBACK
DESCRIPTION
Comparative Study of the Provisions of the Income Tax Act 2025 & Income Tax Act, 1961 is a concise, clause-wise comparison of the two Acts. Every operative provision of the 1961 Act is set against its 2025 counterpart in a two-column layout, aligned down to sub-section, clause, sub-clause, item, proviso, and Explanation. Deletions/modifications in the 1961 text appear in bold + strike-through; simplifications/insertions in the 2025 text appear in bold. Provisions unique to the 2025 Act are collated separately. Each mapped entry includes an 'Analysis of Changes' with extracts from the Select Committee and FAQs from the Income-tax Department/CBDT to explain the rationale and practical impact. This book is intended for the following audience:
• Tax Professionals & Chartered Accountants
• Corporate CFOs, Finance Heads & In-house Tax Teams
• Lawyers & Litigators
• Academicians, Researchers & Students
The Present Publication is the 2025 Edition, edited/authored by Taxmann's Editorial Board, with the following noteworthy features:
• [Section-wise, Word-to-word Textual Comparison] 1961 Act on the left; 2025 Act on the right, aligned to the smallest operative unit
• [Precise Mark-up of Changes]
o 1961 text in bold + strike-through = deletions/modifications in 2025
o 2025 text in bold = simplifications/insertions vis-à-vis 1961
• [Change Analysis After Each Mapped Provision] Explains the nature, intent, and practical implications of every change
• [Select Committee & Departmental FAQs Embedded] Relevant extracts from Committee observations and CBDT FAQs
• [Comprehensive Cross-mapping Tables] Front-loaded grid listing each 1961 section against its 2025 counterptart(s) for instant navigation
• [Coverage of 'No-corresponding-Section' Items] 2025 provisions without a 1961 parallel collated for targeted study