Income Tax Act, 2025
Section 2: Ins. by Act 44 of 1980, s. 28 (w.e.f. 11980).
2. Ins. by Act 44 of 1980, s. 28 (w.e.f. 11980).
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H.—Profits of non-residents from occasional shipping business
172. Shipping business of non-residents.—(1) The provisions of this section shall, notwithstanding
anything contained in the other provisions of this Act, apply for the purpose of the levy and recovery of
tax in the case of any ship, belonging to or chartered by a non-resident, which carries passengers,
livestock, mail or goods shipped at a port in India1***.
(2) Where such a ship carries passengers, livestock, mail or goods shipped at a port in India, 2[seven
and a half per cent.] of the amount paid or payable on account of such carriage to the owner or the
charterer or to any person on his behalf, whether that amount is paid or payable in or out of India, shall be
deemed to be income accruing in India to the owner or charterer on account of such carriage.
(3) Before the departure from any port in India of any such ship, the master of the ship shall prepare
and furnish to the 3[Assessing Officer] a return of the full amount paid or payable to the owner or
charterer or any person on his behalf, on account of the carriage of all passengers, livestock, mail or
goods shipped at that port since the last arrival of the ship thereat:
Provided that where the 3[Assessing Officer] is satisfied that it is not possible for the master of the
ship to furnish the return required by this sub-section before the departure of the ship from the port and
provided the master of the ship has made satisfactory arrangements for the filing of the return and
payment of the tax by any other person on his behalf, the 3[Assessing Officer] may, if the return is filed
within thirty days of the departure of the ship, deem the filing of the return by the person so authorised by
the master as sufficient compliance with this sub-section.
(4) On receipt of the return, the 3[Assessing Officer] shall assess the income referred to in
sub-section (2) and determine the sum payable as tax thereon at the 4[rate or rates in force] applicable to
the total income of a company which has not made the arrangements referred to in section 194 and such
sum shall be payable by the master of the ship.
5[(4A) No order assessing the income and determining the sum of tax payable thereon shall be made
under sub-section (4) after the expiry of nine months from the end of the financial year in which the
return under sub-section (3) is furnished:
Provided that where the return under sub-section (3) has been furnished before the 1st day of April,
2007, such order shall be made on or before the 31st day of December, 2008.]
(5) For the purpose of determining the tax payable under sub-section (4), the 3[Assessing Officer]
may call for such accounts or documents as he may require.
(6) A port clearance shall not be granted to the ship until the Collector of Customs, or other officer
duly authorised to grant the same, is satisfied that the tax assessable under this section has been duly paid
or that satisfactory arrangements have been made for the payment thereof.
(7) Nothing in this section shall be deemed to prevent the owner or charterer of a ship from claiming
before the expiry of the assessment year relevant to the previous year in which the date of departure of the
ship from the Indian port falls, that an assessment be made of his total income of the previous year and
the tax payable on the basis thereof be determined in accordance with the other provisions of this Act, and
if he so claims, any payment made under this section in respect of the passengers, livestock, mail or goods
shipped at Indian ports during that previous year shall be treated as a payment in advance of the tax
The provisions of this section shall, notwithstanding
anything contained in the other provisions of this Act, apply for the purpose of the levy and recovery of
tax in the case of any ship, belonging to or chartered by a non-resident, which carries passengers,
livestock, mail or goods shipped at a port in India1***.
Where such a ship carries passengers, livestock, mail or goods shipped at a port in India, 2[seven
and a half per cent.] of the amount paid or payable on account of such carriage to the owner or the
charterer or to any person on his behalf, whether that amount is paid or payable in or out of India, shall be
deemed to be income accruing in India to the owner or charterer on account of such carriage.
Before the departure from any port in India of any such ship, the master of the ship shall prepare
and furnish to the 3[Assessing Officer] a return of the full amount paid or payable to the owner or
charterer or any person on his behalf, on account of the carriage of all passengers, livestock, mail or
goods shipped at that port since the last arrival of the ship thereat:
Provided that where the 3[Assessing Officer] is satisfied that it is not possible for the master of the
ship to furnish the return required by this sub-section before the departure of the ship from the port and
provided the master of the ship has made satisfactory arrangements for the filing of the return and
payment of the tax by any other person on his behalf, the 3[Assessing Officer] may, if the return is filed
within thirty days of the departure of the ship, deem the filing of the return by the person so authorised by
the master as sufficient compliance with this sub-section.
On receipt of the return, the 3[Assessing Officer] shall assess the income referred to in
sub-section
and determine the sum payable as tax thereon at the 4[rate or rates in force] applicable to
the total income of a company which has not made the arrangements referred to in section 194 and such
sum shall be payable by the master of the ship.
5[
No order assessing the income and determining the sum of tax payable thereon shall be made
under sub-section
after the expiry of nine months from the end of the financial year in which the
return under sub-section
is furnished:
Provided that where the return under sub-section
has been furnished before the 1st day of April,
2007, such order shall be made on or before the 31st day of December, 2008.]
For the purpose of determining the tax payable under sub-section
A port clearance shall not be granted to the ship until the Collector of Customs, or other officer
duly authorised to grant the same, is satisfied that the tax assessable under this section has been duly paid
or that satisfactory arrangements have been made for the payment thereof.
Nothing in this section shall be deemed to prevent the owner or charterer of a ship from claiming
before the expiry of the assessment year relevant to the previous year in which the date of departure of the
ship from the Indian port falls, that an assessment be made of his total income of the previous year and
the tax payable on the basis thereof be determined in accordance with the other provisions of this Act, and
if he so claims, any payment made under this section in respect of the passengers, livestock, mail or goods
shipped at Indian ports during that previous year shall be treated as a payment in advance of the tax