Section 216 is the substantive equivalent of 1961 s. 115 G -- procedural simplification for NRI: NOT NECESSARY to furnish return of income u/s 263(1) where NRI's total income consists ONLY of investment income / LTCG from foreign exchange…
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ITA 2025 · Section 216
Section 216 — - NRI RETURN-FILING EXEMPTION
Section 216 is the substantive equivalent of 1961 s. 115G -- procedural simplification for NRI: NOT NECESSARY to furnish return of income u/s 263(1) where NRI's total income consists ONLY of investment income / LTCG from foreign exchange asset AND TDS has been deducted at source. Effectively: NRI with only NRO-style passive income covered fully by TDS need not file return. Practitioner: many NRIs benefit; but if also have other Indian-source income, return required.
CONDITIONS: (a) NRI total income consists ONLY of (i) investment income from foreign exchange assets; AND/OR (ii) LTCG on foreign exchange asset transfer; (b) TDS has been deducted at source on all such income. Effect: NRI need NOT file return u/s 263(1). PRACTITIONER: useful for NRIs with passive Indian-investment-portfolio (NRO bank deposits / Indian-co debentures / Indian-co equity dividends) where TDS at source is applied. If NRI has any OTHER Indian-source income (e.g., rental from Indian property / business income), return required. If NRI wants to claim REFUND (TDS exceeded final tax liability), return MUST be filed despite the exemption.
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