Income Tax Circular No. 11 of 2020 Dated  May 8, 2020 in Respect of Residential Status for Assessment Year (AY) 2020-21

Section 6 of the Income Tax Act deals with the Residential Status.

An individual is said to be resident in India in any previous year, if he

(a) is in India in previous year for a period of  182 days or more or

(b) is in India for 60 or more during the previous year and 365 or more during  the 4 years immediately preceding previous year   (Not applicable for person who leaves India for employment or as a member of a Crew ship)

Further an Individual shall be treated as Resident and Ordinarily Resident in India if he  satisfies the following conditions

(i) An individual is a resident in India in at least 2 out of 10 immediately preceding previous Year and

(ii) Has been in India for 730 days or more during the 7 immediately preceding previous year.

But in order to protect the individuals who wanted to maintain their status as non resident or resident but not ordinarily resident and intended to leave India in order to do so but were not able to leave India due to the lockdown imposed by the Government of India, CBDT has  come out with this circular in which an Individual who has come to India on a visit before 22nd March 2020 and :-

(a) Could not leave India on or before 31st March 2020, their stay in India from 22nd March 2020 to 31st March 2020 shall not be taken into account for the purpose of this section

(b)  Has been quarantined in India on account of  Corona Virus on or after 1st March 2020 and has departed on an evacuation flight or has been unable to leave India on or before 31st March 2020 , the period of stay from the beginning of quarantine to the date of departure or 31st March 2020 whichever is earlier shall not be taken into account for the purpose of this Section

(c)  has departed on an evacuation flight on or before 31st March 2020, the period of stay in India from 22nd March 2020 to 31st March 2020 shall not be taken into account for the purpose of this Section

The difference between b and c point above is that in point b it talks about person who has been quarantined and in point c it talks about person other than the quarantined person

Source – Income Tax Circular No. 11 of 2020 Dated  May 8, 2020

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