Income Tax Act, 2025
Section 3: Subs. by Act 32 of 2003, s. 51, for “dividends” (w.e.f. 12004).
3. Subs. by Act 32 of 2003, s. 51, for “dividends” (w.e.f. 12004).
469
1[115ACA. Tax on income from Global Depository Receipts purchased in foreign currency or
capital gains arising from their transfer.—2[(1) Where the total income of an assessee, being an
individual, who is a resident and an employee of an Indian company engaged in specified knowledge
based industry or service, or an employee of its subsidiary engaged in specified knowledge based industry
or service (hereafter in this section referred to as the resident employee), includes—
(a) 3[income by way of dividends, other than dividends referred to in section 115-O], on Global
Depository Receipts of an Indian company engaged in specified knowledge based industry or service,
issued in accordance with such Employees’ Stock Option Scheme as the Central Government may, by
notification in the Official Gazette, specify in this behalf and purchased by him in foreign currency;
or
(b) income by way of long-term capital gains arising from the transfer of Global Depository
Receipts referred to in clause (a),
the income-tax payable shall be the aggregate of—
(i) the amount of income-tax calculated on the 3[income by way of dividends, other than
dividends referred to in section 115-O], in respect of Global Depository Receipts referred to in
clause (a), if any, included in the total income, at the rate of ten per cent;
(ii) the amount of income-tax calculated on the income by way of long-term capital gains
referred to in clause (b), if any, at the rate of ten per cent; and
(iii) the amount of income-tax with which the resident employee would have been chargeable had
his total income been reduced by the amount of income referred to in clauses (a) and (b).
Explanation.—For the purposes of this sub-section,—
(a) “specified knowledge based industry or service” means—
(i) information technology software;
(ii) information technology service;
(iii) entertainment service;
(iv) pharmaceutical industry;
(v) bio-technology industry; and
(vi) any other industry or service, as may be specified by the Central Government, by
notification in the Official Gazette;
(b) “subsidiary” shall have the meaning assigned to it in section 4 of the Companies Act, 1956
(1 of 1956) and includes subsidiary incorporated outside India.]
(2) Where the gross total income of the resident employee—
(a) consists only of 3[income by way of dividends, other than dividends referred to in
section 115-O], in respect of Global Depository Receipts referred to in clause (a) of sub-section (1),
no deduction shall be allowed to him under any other provision of this Act;
(b) includes any income referred to in clause (a) or clause (b) of sub-section (1), the gross total
income shall be reduced by the amount of such income and the deduction under any provision of this
Act shall be allowed as if the gross total income as so reduced were the gross total income of the
assessee.
(3) Nothing contained in the first and second provisos to section 48 shall apply for the computation of
long-term capital gains arising out of the transfer of long-term capital asset, being Global Depository
Receipts referred to in clause (b) of sub-section (1).
Where the total income of an assessee, being an
individual, who is a resident and an employee of an Indian company engaged in specified knowledge
based industry or service, or an employee of its subsidiary engaged in specified knowledge based industry
or service (hereafter in this section referred to as the resident employee), includes—
3[income by way of dividends, other than dividends referred to in section 115-O], on Global
Depository Receipts of an Indian company engaged in specified knowledge based industry or service,
issued in accordance with such Employees’ Stock Option Scheme as the Central Government may, by
notification in the Official Gazette, specify in this behalf and purchased by him in foreign currency;
or
income by way of long-term capital gains arising from the transfer of Global Depository
Receipts referred to in clause
the amount of income-tax calculated on the 3[income by way of dividends, other than
dividends referred to in section 115-O], in respect of Global Depository Receipts referred to in
clause
the amount of income-tax calculated on the income by way of long-term capital gains
referred to in clause
the amount of income-tax with which the resident employee would have been chargeable had
his total income been reduced by the amount of income referred to in clauses
and
“specified knowledge based industry or service” means—
information technology software;
information technology service;
entertainment service;
pharmaceutical industry;
bio-technology industry; and
any other industry or service, as may be specified by the Central Government, by
notification in the Official Gazette;
“subsidiary” shall have the meaning assigned to it in section 4 of the Companies Act, 1956
(1 of 1956) and includes subsidiary incorporated outside India.]
Where the gross total income of the resident employee—
consists only of 3[income by way of dividends, other than dividends referred to in
section 115-O], in respect of Global Depository Receipts referred to in clause
of sub-section
includes any income referred to in clause
or clause
of sub-section
Nothing contained in the first and second provisos to section 48 shall apply for the computation of
long-term capital gains arising out of the transfer of long-term capital asset, being Global Depository
Receipts referred to in clause
of sub-section