The CBDT has issued a notification whereby there is a new rule for residential status of Indian citizen who is a crew member of an Indian Ship.
As per the rule –
- The numbers of days of stay in India for such person shall not include the days – from the start date of the Continuous Discharge Certificate and ending on the end date of this document, as signed off on this document.
- Continuous Discharge Certificate must be as per the Merchant Shipping (Continuous Discharge Certificate-cum-seafarer’s Identity Document) Rules, 2001 made under the merchant shipping act, 1958
- This Continuous Discharge Certificate must be for a voyage, which originates from any port in India and has its destination at any port outside India OR which originates from any port outside India and has its destination at any port in India.
This rule has been made effective retrospectively from 1st April 2015. So this new rule is applicable for finding out residential status of Indian citizens as crew on Indian ships starting financial year 2015-16.
Such crew is considered as Non Resident Indian (NRI) for income tax purposes, when they have spent less than 182 days in India. While calculating this stay of 182 days, the entire period mentioned in the Continuous Discharge Document shall be excluded. Even though the ship may have been on Indian coastal waters in its journey. Earlier, the number of days outside India were only calculated from the date the Indian ship left Indian coastal waters.
Do note that any Indian citizen as crew on a foreign ship is considered Non-Resident.
These changes to Section 6(1) and 6(2) have been announced via CBDT notification 70 dated 17th August 2015.