Tax on income of Foreign Institutional Investors from securities or capital gains arising from their transfer
(1)
The income-tax payable on total income of an assessee, being specified fund or Foreign Institutional Investor, which includes the income to in column B of the Table below, shall be the aggregate of the amounts mentioned in column C thereof. their Table Sl. Income Income-tax No. payable A B C 1. Securities other than units referred to in section (a) 20 % 5 208. case of Foreign Institutional Investor;
(b)
10 % in of specified 2. Short-term capital gains (not being short-term 30 % capital gains referred to in section 196section 196) arising from the transfer of such securities. 3. Short-term capital gains referred to in section 196section 196 20 % arising from the transfer of such securities 4. Long-term capital gains (not being long-term 12.5 % capital gains referred to in section 198section 198 arising from the transfer of such securities 5. Long-term capital gains referred to in section 198section 198 12.5 % arising from the transfer of such securities which exceeds ₹ 1,25,000. 6. Total income as reduced by income referred to Income-tax against serial numbers 1 to 5. chargeable on income.
(2)
In case of specified fund, provisions of this section shall apply only 25 extent of income that is attributable to units held by non-resident (not being permanent establishment of such non-resident in India) calculated in the manner prescribed, irrespective of the provisions of sub-section (1).
(3)
Irrespective of anything contained in sub-section (1), where specified fund–– 30 (a) is investment division of an offshore banking unit as specified serial number 1 of the Table in Schedule III.6; and (b) fulfills the conditions referred to in clause (g) D(ii) of cell E1 of Table in Schedule VI (Note 1), the provisions of this section shall apply to the extent of income that is attributable 35 to such investment division, calculated in the manner, as prescribed.
(4)
Where the gross total income of the specified fund or Institutional Investor— (a) consists only of income in respect of securities referred sub-section (1) (Table: Sl. No. 1), no deduction shall be allowed to it sections 26sections 26 to 61 or section 93section 93(1)(a) or (e) or under Chapter VIII;
(b)
includes any income referred to in sub-section (1) (Table: Sl. to (Table: Sl. No. 5),–– (i) the gross total income shall be reduced by the amount of income; and (ii) the deduction under Chapter VIII shall be allowed as if gross total income as so reduced, were the gross total income of specified fund or Foreign Institutional Investor.
(5)
The provisions of section 72section 72(6) shall not apply for the computation capital gains arising out of the transfer of securities referred to in sub-section (Table: Sl. No. 2) to (Table: Sl. No. 5).
(6)
In this section,––
(a)
“Foreign Institutional Investor” means an investor so specified notification by the Central Government;
(b)
“permanent establishment” shall have the meaning assigned to section 173section 173(c);
(c)
(d)
“specified fund” shall have the meaning assigned to it in Schedule [Note 1]