Income Tax Act, 2025
Section 7: Ins. by Act 20 of 2015, s. 4 (w.e.f. 12015).
7. Ins. by Act 20 of 2015, s. 4 (w.e.f. 12015).
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1[(3) A company is said to be a resident in India in any previous year, if—
(i) it is an Indian company; or
(ii) its place of effective management, in that year, is in India.
Explanation.—For the purposes of this clause “place of effective management” means a place
where key management and commercial decisions that are necessary for the conduct of business of an
entity as a whole are, in substance made.]
(4) Every other person is said to be resident in India in any previous year in every case, except
where during that year the control and management of his affairs is situated wholly outside India.
(5) If a person is resident in India in a previous year relevant to an assessment year in respect of
any source of income, he shall be deemed to be resident in India in the previous year relevant to the
assessment year in respect of each of his other sources of income.
2[(6) A person is said to be “not ordinarily resident” in India in any previous year if such person
is—
(a) an individual who has been a non-resident in India in nine out of the ten previous years
preceding that year, or has during the seven previous years preceding that year been in India for a
period of, or periods amounting in all to, seven hundred and twenty-nine days or less; or
(b) a Hindu undivided family whose manager has been a non-resident in India in nine out of
the ten previous years preceding that year, or has during the seven previous years preceding that
year been in India for a period of, or periods amounting in all to, seven hundred and twenty-nine
days or less.]
7. Income deemed to be received.—The following incomes shall be deemed to be received in the
previous year:—
(i) the annual accretion in the previous year to the balance at the credit of an employee
participating in a recognised provident fund, to the extent provided in rule 6 of Part A of the Fourth
Schedule;
(ii) the transferred balance in a recognised provident fund, to the extent provided in sub-rule (4)
of rule 11 of Part A of the Fourth Schedule;
3[(iii) the contribution made, by the Central Government 4[or any other employer] in the previous
year, to the account of an employee under a pension scheme referred to in section 80CCD.]
8. Dividend income.—5[For the purposes of inclusion in the total income of an assessee,—
(a) any dividend] declared by a company or distributed or paid by it within the meaning of
sub-clause (a) or sub-clause (b) or sub-clause (c) or sub-clause (d) or sub-clause (e) of clause (22)
of section 2 shall be deemed to be the income of the previous year in which it is so declared,
distributed or paid, as the case may be;
6[(b) any interim dividend shall be deemed to be the income of the previous year in which the
amount of such dividend is unconditionally made available by the company to the member who is
entitled to it.]
A company is said to be a resident in India in any previous year, if—
it is an Indian company; or
its place of effective management, in that year, is in India.
Explanation.—For the purposes of this clause “place of effective management” means a place
where key management and commercial decisions that are necessary for the conduct of business of an
entity as a whole are, in substance made.]
Every other person is said to be resident in India in any previous year in every case, except
where during that year the control and management of his affairs is situated wholly outside India.
If a person is resident in India in a previous year relevant to an assessment year in respect of
any source of income, he shall be deemed to be resident in India in the previous year relevant to the
assessment year in respect of each of his other sources of income.
2[
A person is said to be “not ordinarily resident” in India in any previous year if such person
is—
an individual who has been a non-resident in India in nine out of the ten previous years
preceding that year, or has during the seven previous years preceding that year been in India for a
period of, or periods amounting in all to, seven hundred and twenty-nine days or less; or
a Hindu undivided family whose manager has been a non-resident in India in nine out of
the ten previous years preceding that year, or has during the seven previous years preceding that
year been in India for a period of, or periods amounting in all to, seven hundred and twenty-nine
days or less.]
7. Income deemed to be received.—The following incomes shall be deemed to be received in the
previous year:—
the annual accretion in the previous year to the balance at the credit of an employee
participating in a recognised provident fund, to the extent provided in rule 6 of Part A of the Fourth
Schedule;
the transferred balance in a recognised provident fund, to the extent provided in sub-rule
of rule 11 of Part A of the Fourth Schedule;
3[
the contribution made, by the Central Government 4[or any other employer] in the previous
year, to the account of an employee under a pension scheme referred to in section 80CCD.]
8. Dividend income.—5[For the purposes of inclusion in the total income of an assessee,—
any dividend] declared by a company or distributed or paid by it within the meaning of
sub-clause
or sub-clause
or sub-clause
or sub-clause
or sub-clause
of clause
of section 2 shall be deemed to be the income of the previous year in which it is so declared,
distributed or paid, as the case may be;
6[
any interim dividend shall be deemed to be the income of the previous year in which the
amount of such dividend is unconditionally made available by the company to the member who is
entitled to it.]