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Practice Sheet
Chapter 2 - Residential Status
Illustration 1:
Sam came to India first time during the P.Y. 2022-23. During the previous year, he stayed in India for (i) 50 days;
(ii) 183 days; & (iii) 153 days. Determine his residential status for the A.Y. 2023-24.

Solution:
(i) Since Sam resides in India only for 50 days during the P.Y. 2022-23, he does not satisfy any of the conditions
specified in sec. 6(1). He is, therefore, a non-resident in India for the P.Y. 2022-23.
(ii) Since Sam resides in India for 183 days during the previous year 2022-23, he satisfies one of the conditions specified in
sec. 6(1). He is, therefore, a resident in India for the P.Y. 2022-23.
(iii) Sam resides in India only for 153 days during the previous year 2022-23. Though he resided for more than 60 days during
the previous year but in 4 years immediately preceding the previous year (as he came India first time), he did not reside in
India. Hence, he does not satisfy any of the conditions specified in sec. 6(1). Thus, he is a non-resident for the P.Y. 2022-
23.

Illustration 2.
Andy, a British national, comes to India for the first time during 2018-19. During the financial years 2018-19, 2019-20, 2020-
21, 2021-22 and 2022-23, he was in India for 55 days, 60 days, 80 days, 160 days and 70 days respectively. Determine his
residential status for the assessment year 2023-24.
Solution:
During the previous year 2022-23, Andy was in India for 70 days & during 4 years immediately preceding the previous year,
he was in India for 355 days as shown below:

Year 2018-19 2019-20 2020-21 2021-22 Total

No. of days stayed in India 55 60 80 160 355
Thus, he does not satisfy Sec.6(1) & consequently, he is a non-resident in India for the P.Y. 2022-23.
Illustration 3:
Miss Pal, an Indian citizen, left India for first time on 1st April, 2022 for joining job in Tokyo. She came to India on11th Jan, 2023
for only 170 days. Determine her residential status for P.Y. 2022-23.
Solution:
Number of days Miss Pal stayed in India can be calculated as under:

P.Y. Apr May June July Aug Sep Oct Nov Dec Jan Feb Mar Total
22-23 1 - - - - - - - - 21 28 31 81
23-24 30 31 29 - - - - - - - - - 90
Since she left India for employment purpose, hence for becoming resident she has to stay in India for at least 182 days.
However, she is in India for only 81 days during the previous year, thus she is a non-resident for the P.Y. 2022-23.

Illustration 4.
Mr. X, aged 19 years, left India for first time on May 31, 2022. Determine his residential status for the previous
year 2022-23 if:
(i) He left India for employment purpose
(ii) He left India on world tour.
Solution:

CA Amit Mahajan | Telegram - 9969842303

During the previous year 2022-23, Mr. X was in India for 61 days as shown below –

P.Y. Apr May June July Aug Sep Oct Nov Dec Jan Feb Mar Total
22-23 30 31 - - - - - - - - - - 61
During the previous year 2022-23, X stayed in India for 61 days. Further, he was in India for more than 365 days
during 4 years immediately preceding the relevant previous year (as he left India for first time).
(i) Since he left India for employment purpose, condition of sec. 6(1)(c) shall not be applicable on such assessee. He will be
treated as resident in India, if and only if, he resided in India for at least 182 days during the previous year. Hence, Mr. X
is a non-resident in India for the previous year 2022-23.
(ii) Since he left India on world tour, which is not an exception of sec. 6(1), satisfaction of any one condition of sec. 6(1)
makes him resident in India for the previous year 2022-23. As he satisfies 2nd condition of sec. 6(1) [shown above], he is
resident in India. Further, he also satisfies dual conditions specified u/s 6(6) (since he left India for first time). Therefore, he
is an ordinarily resident for the previous year 2022-23.

Illustration 5.
X came India for first time on July 24, 2018. From July 24, 2018 to December 25, 2019 he was in India. Again, he came to
India on August 5, 2022 for employment purpose & left India on November 25, 2022 permanently. Determine his residential
status for the previous year 2022-23 assuming -
(a) He is a foreign citizen (b) He is an Indian citizen
Solution:
During the previous year 2022-23, X was in India for 113 days as shown below:

Year Apr May June July Aug Sep Oct Nov Dec Jan Feb Mar Total
22-23 - - - - 27 30 31 25 - - - - 113
Further, he was in India for more than 365 days during 4 years immediately preceding the previous year as shownbelow:

Year Apr May June July Aug Sep Oct Nov Dec Jan Feb Mar Total
18-19 - - - 8 31 30 31 30 31 31 28 31 251
19-20 30 31 30 31 31 30 31 30 25 - - - 269
20-21 - - - - - - - - - - - - -
21-22 - - - - - - - - - - - - -
As he satisfies condition given in sec. 6(1)(c), he is a resident in India.
Further, he was resident during 2 out of 10 years immediately preceding the relevant previous year but he was in India only for
520 days in 7 years immediately preceding the relevant previous year. As he is not satisfying dual conditions of sec. 6(6), he is
a resident but not ordinarily resident in India for the previous year 2022-23.
Note: His status shall remain same in both the cases as -

(a) Foreign citizens are not covered by ‘exceptions to sec. 6(1)(c)’.

(b) Coming in India for employment purpose is not covered by ‘exceptions to sec. 6(1)(c)’.
Illustration 6.
X, a foreign citizen, resides in India during the previous year 2022-23 for 83 days. Determine his residential status for previous
year 2022-23 assuming his stay in India during the last few previous years are as follows -

Year Days Year Days Year Days Year Days

2007-08 220 days 2011-12 36 days 2015-16 137 days 2019-20 175 days
2008-09 15 days 2012-13 115 days 2016-17 265 days 2020-21 15 days
2009-10 257 days 2013-14 123 days 2017-18 310 days 2021-22 67 days
2010-11 110 days 2014-15 65 days 2018-19 121 days
Solution:
During previous year 2022-23, X was in India for 83 days & during 4 years immediately preceding the previous year, he was in
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India for 378 days as shown below:

Year 2018-19 2019-20 2020-21 2021-22 Total

No. of days stayed in India 121 175 15 67 378
Thus, he satisfies one of the conditions specified u/s 6(1) & consequently, he becomes resident in India in the P.Y. 2022-23.
Further, to determine whether X is an ordinarily resident or not, he needs to satisfy both conditions laid down u/s 6(6).

Year Presence in India Resident or Non Condition satisfied to become a

(In Days) resident resident
2021-2022 67 Resident 6(1)(c)
2020-2021 15 Non Resident None
2019-2020 175 Resident 6(1)(c)
2018-2019 121 Resident 6(1)(c)
2017-2018 310 Resident Both
2016-2017 265 Resident Both
2015-2016 137 Non Resident None
2014-2015 65 Resident 6(1)(c)
2013-2014 123 Resident 6(1)(c)
2012-2013 115 Resident 6(1)(c)
Condition (i) of sec. 6(6) requires that an individual should be resident in India for at least 2 out of 10 years preceding the
relevant previous year. X was resident in India for 8 out of 10 years immediately preceding the previous year. Thus, he satisfies
this condition.
Condition (ii) of sec. 6(6) requires that an individual should be present in India for at least 730 days during 7 years preceding to
relevant previous year. X was in India for 1090 days during 2015-16 to 2021-22. Hence, he satisfies this condition also.
X satisfies condition (ii) of sec. 6(1) as well as both the conditions of sec. 6(6). Thus, he is a resident and ordinarily
resident in India for the previous year 2022-23.

Test Yourself
1. Mr. X, a foreign citizen, came in India for the first time on July 24, 2018. From July 24, 2018 to December
25, 2019 he was in India. Again, he came to India on August 5, 2022 for employment purpose and left India
on November 25, 2022 permanently. Determine his residential status for the assessment year 2023-24.
2. Determine the residential status of the following person for the assessment year 2023-24:
Mr. Balm came to India from England on 30th June, 2016 and after staying for three years in India he went
Germany on 1st July 2019. On 1st April, 2020, he again came back to India and stayed in India upto 31st
July, 2021. On 1st August, 2021, he went to Denmark at a monthly salary of ` 8,00,000. He transferred to
India on 1st January, 2023 and joined Delhi office of the same organization and started staying in India
since then.
3. Brown, a citizen of Bahama, came to India for the first time on 10th August, 2017 and stayed up to 5th
March, 2018. Subsequently, he stayed in India during 2018-19, 19-20, 20-21, 21-22 and 22-23 for 120 days,
110 days, 100 days, 85 days and 62 days respectively. Determine his residential status for the A.Y. 2023-24
Hints:
1. Resident but not ordinarily resident;
2. Resident and ordinarily resident;
3. Resident but not ordinarily resident

Illustration 7.
Ram provides following details of income, calculate the income which is liable to be taxed in India for theA.Y.2023-24
assuming that –

(a) He is an ordinarily resident (b) He is not an ordinarily resident (c) He is a non-resident.

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 Particulars Amount
Salary received in India from a former employer of UK 1,40,000
Income from tea business in Nepal being controlled from India 10,000
Interest on company deposit in Canada (1/3rd received in India) 30,000
Profit from a business in Mumbai controlled from UK 1,00,000
Profit for the year 2012-13 from a business in Tokyo remitted to India 2,00,000
Income from a property in India but received in USA 45,000
Income from a property in London but received in Delhi 1,50,000
Income from a property in London but received in Canada 2,50,000
Income from a business in Jambia but controlled from Turkey 10,000

Solution:
Calculation of income liable to be taxed in India of Ram for the A.Y.2023-24
Particulars Resident & Resident but Non-
Ordinarily not ordinarily resident
resident resident
Salary received in India from a former employer of UK 1,40,000 1,40,000 1,40,000
Income from tea business in Nepal being controlled from India 10,000 10,000 Nil
Interest on company deposit in Canada -
- 1/3rd received in India 10,000 10,000 10,000
- 2/3rd received outside India 20,000 Nil Nil
Profit from a business in Mumbai controlled from UK 1,00,000 1,00,000 1,00,000
Past Profit from a business in Tokyo remitted to India Nil Nil Nil
Income from a property in India but received in USA 45,000 45,000 45,000
Income from a property in London but received in Delhi 1,50,000 1,50,000 1,50,000
Income from a property in London but received in Canada 2,50,000 Nil Nil
Income from a business in Jambia but controlled from Turkey 10,000 Nil Nil
Income liable to tax in India 7,35,000 4,55,000 4,45,000

Test Yourself
1. Mr. Rupankar Roy, an Indian Citizen, left India for the purpose of employment in USA for the first time on 1st
October, 2022. He came back to India on 30th March, 2023 for visit and returned back to USA after staying 20 days in
India. During the previous year 2022–23, he earned the following Income:
(i) Interest earned in USA ₹ 5,00,000 and credited in USA.
(ii) Interest received in India out of Fixed Deposit in Bank ₹ 1,20,000.
Determine his residential status and Tax Incidence in India for the A.Y. 2023-24
2. Mr. Ajnabi provides following information regarding his income of P.Y. 2022-23. Compute income liable tobe charged in
India in the following cases:
a) He is an ordinarily resident b) He is not an ordinarily resident. c) He is a non-resident
Particulars ₹
Business income from USSR received in India 10,000
Business income earned in India received in Pakistan 20,000
Salary income from a company of UK situated in India 15,000
Interest on German Development Bond (2/5th received in India) 60,000
Income from agriculture in Nepal received there but later on remitted to India 1,81,000
Income from property in Jakarta received outside India 86,000
Income earned from business in UAE which is controlled from Delhi (₹ 15,000 received in 65,000
India)
Past untaxed profit of 15-16 brought to India during previous year 10,43,000
Profit from a business in Madras and managed from outside India 27,000
Profit on a sale of a building in India but received in Sri Lanka 14,80,000
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Pension from a former employer in India received in USSR 36,000

Hints
1. Resident and ordinarily resident; ₹ 6,20,000/- 2. ₹ 19,80,000; ₹ 16,77,000; ₹ 16,27,000

Illustration 8.
Miss Monica, a foreign national, comes India every year for 90 days since 2007-08.
a) Determine her residential status for the previous year 2022-23.
b) Will your answer differ, if she comes India for 100 days instead of 90 days every year.
Solution:
a) Since Miss Monica stayed for 90 days during the previous year 2022-23 and for 360 days (90 days x 4 years) during the 4
years immediately preceding the previous year, hence, she is not satisfying any of the conditionsof sec. 6(1). Thus, she is a
non-resident for the previous year 2022-23.
b) Since Miss Monica stayed for 100 days during the previous year 2022-23 and for 400 days (100 days X 4 years) during the
4 years immediately preceding the previous year, hence, she is satisfying sec. 6(1)(c). Thus, she is resident for the previous
year 2022-23. Further, she resides for only 700 days (100 days x 7 years) during the 7 years immediately preceding the
previous year. Hence, she does not satisfy one of the conditions of sec.6(6). Thus, she is resident but not ordinarily resident
for the previous year 2022-23.

Illustration 9.
Mr. Sid, a British national, joined XYZ Co. Ltd. as an engineer in India on 1st May, 2012. On 31st December, 2013,he went to Sri
Lanka on deputation. On 1st April, 2018, he came back to India and left for Sri Lanka again on 31st May, 2018. He returned to
India and joined his original post on 1st July, 2022. Determine his residential status forthe A.Y. 2023-24.
Solution:
Number of days Mr. Sid stayed in India in past few years can be calculated as under:

SN P.Y. Apr May June July Aug Sep Oct Nov Dec Jan Feb Mar Total
0 22-23 - - - 31 31 30 31 30 31 31 28 31 274
1 21-22 - - - - - - - - - - - - 0
2 20-21 - - - - - - - - - - - - 0
3 19-20 - - - - - - - - - - - - 0
4 18-19 30 31 - - - - - - - - - - 61
5 17-18 - - - - - - - - - - - - 0
6 16-17 - - - - - - - - - - - - 0
7 15-16 - - - - - - - - - - - - 0
8 14-15 - - - - - - - - - - - - 0
9 13-14 30 31 30 31 31 30 31 30 31 - - - 275
10 12-13 - 31 30 31 31 30 31 30 31 31 28 31 335

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On the basis of data drawn, residential status of Mr. Sid in last few years can be decided as under:

Presence in India Resident (R) or Condition satisfied to become

Year Previous Year
(In days) Non resident (NR) a resident
1 2021-2022 0 NR None
2 2020-2021 0 NR None
3 2019-2020 0 NR None
4 2018-2019 61 NR None
5 2017-2018 0 NR None
6 2016-2017 0 NR None
7 2015-2016 0 = 61 NR None
8 2014-2015 0 NR None
9 2013-2014 275 R 6(1)(a)
10 2012-2013 335 R 6(1)(a)
Since assessee resided in India for 274 days in the previous year 2022-23, hence he satisfies sec. 6(1)(a). Therefore,
he is resident in India.
Further, since he is resident in India for 2 years out of 10 years preceding the previous year (as shown in above working), but
resided in India for less than 730 days out of 7 immediately preceding years, hence he does not satisfy one of the conditions of
sec. 6(6), therefore, he is resident but not ordinarily resident.
Conclusion: Resident but not ordinarily resident.