Indian companies are taxable in India on their worldwide income.
Foreign companies are taxable on income that arises out of their Indian operations, or, in certain cases, income that is deemed to arise in India. Though it is presumed that the main source of income for a company is business but there are other sources of income too. Like a company might earn from house property, capital gains and many other sources. Taxable income is calculated according to the rules for each class of income and then aggregated to determine total taxable income. This includes interest on borrowings paid in the financial year and depreciation on fixed assets.