Section 212
Section 212: definitions for the NRI investment income provisions
Section 212 sets out the definitions that apply throughout sections 213 to 218 - the special Part of this Chapter dealing with how a non-resident Indian's investment income and long-term capital gains from foreign-currency investments are taxed.
Defined terms
For the purposes of sections 213 to 218, the following definitions apply:
| Term | Meaning |
|---|---|
| "Foreign exchange asset" | Any specified asset which the assessee has acquired or purchased with, or subscribed to in, convertible foreign exchange |
| "Investment income" | Any income derived from a foreign exchange asset |
| "Long-term capital gains" (for this Part) | Income chargeable under the head "Capital gains" relating to a capital asset that is a foreign exchange asset which is not a short-term capital asset |
| "Non-resident Indian" | An individual who is not a resident and who is either (i) a citizen of India, or (ii) a person of Indian origin |
What counts as a "specified asset"
A "specified asset" is any of the following:
- Shares in an Indian company;
- Debentures issued by an Indian company that is not a private company under the Companies Act, 2013;
- Deposits with an Indian company that is not a private company under the Companies Act, 2013;
- Any security of the Central Government as defined in section 2(f) of the Government Securities Act, 2006; or
- Any other asset the Central Government specifies by notification.
Frequently asked questions
Which sections does Section 212 apply to?
Its definitions govern sections 213 to 218 - the Act's special provisions on NRI investment income and related long-term capital gains.
Do shares in a private Indian company count as a specified asset?
No - the definition of "specified asset" excludes debentures of, and deposits with, a private company under the Companies Act, 2013 (though shares in an Indian company generally do qualify).
Related sections
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