sec.9 income accrued or deemed to accrue in india

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hiren (Querist)
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01 June 2009 one of my client is servicing in china and head office of his employer is in dubai,he is getting salary from dubai by cheque sent to india and he get it deposited into an NRE A/c he is non resident last year, the question is whether his income will be chargeable to tax on the basis that his first receipt in india, please explain me by giving sec. reference, regards CA HIREN SHETH

chetan soni

chetan soni (Expert)
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01 June 2009 Lets take the steps as follows :

1. Person working in china head office at dubai
2. Salary paid to him in china by HO
3. He himself deposited this amount in hin NRE a/c in india.

If this is the condition then it as per sec. 9, salary income charged in india is the same is accrued or arise in India. As per clause (ii) service should be rendered in india & rest period or leave period which is preceded and succeeded by services rendered in India and forms part of the service contract of employment then is taxable india.

Please see the section in details

(ii) income which falls under the head Salaries, if it is earned67 in India.

68[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 ;