The notification, issued by the Central Government, pertains to the activity of investment in a financial product by a non-resident, where the income from such investment is received in the non-resident's account maintained with the Offshore Banking Unit of an International Financial Services Centre (IFSC). This investment activity is notified under Section 10(4G) of the Income-tax Act, 1961, provided it is conducted as per a contract between the non-resident and a capital market intermediary which is a Unit of an IFSC.
Key Changes
The Central Government has notified investment in a financial product by a non-resident as per Section 10(4G) of the Income-tax Act, 1961, subject to specific conditions.
The investment must be made in accordance with a contract between the non-resident and a capital market intermediary that is a Unit of an IFSC.
The income from the investment must be received in the non-resident's account maintained with the Offshore Banking Unit of the IFSC.
The notification clarifies the definitions of 'capital market intermediary,' 'financial product,' 'International Financial Services Centre,' and 'Unit' by referencing relevant sections of the International Financial Services Centres Authority (Capital Market Intermediaries) Regulations, 2021, the International Financial Services Centres Authority Act, 2019, and the Special Economic Zones Act, 2005, respectively.
Impact Analysis
Impact on Non-Residents
Non-residents must ensure that the income from such investments is received in their account maintained with the Offshore Banking Unit of the IFSC.
Impact on Capital Market Intermediaries
They must establish contracts with non-residents for investment in financial products to qualify under this notification.
Impact on International Financial Services Centres (IFSCs)
IFSC Units should ensure compliance with the Special Economic Zones Act, 2005.
Suggested Action Items
IFSCs should continue to promote and facilitate investment activities in accordance with the regulatory framework.
Key Entities Referenced
Central Board of Direct Taxes (CBDT): The issuer of the notification, under the Department of Revenue, Ministry of Finance.
Income-tax Act, 1961: The principal act governing income tax in India, specifically Section 10(4G) which pertains to exemptions for non-resident investments.
International Financial Services Centres (IFSC): Special economic zones designed to provide financial services to non-residents and residents, regulated under the Special Economic Zones Act, 2005.
Offshore Banking Unit: A banking unit within an IFSC that handles transactions in foreign currency.
Capital Market Intermediary: An entity defined under the International Financial Services Centres Authority (Capital Market Intermediaries) Regulations, 2021, that facilitates transactions in the capital market within an IFSC.
International Financial Services Centres Authority Act, 2019: Act defining financial products.
Special Economic Zones Act, 2005: Act defining International Financial Services Centre and Unit.
रजिस्ट्री स.ं डी.एल.- 33004/99 REGD. No. D. L.-33004/99
सी.जी.-डी.एल.-अ.-04012024-251158
CG-DxLx-xEG-I0D4H0x1x2x0 24-251158
xxxGIDExxx
असाधारण
EXTRAORDINARY
भाग II—खण् ड 3—उप-खण्ड (ii)
PART II—Section 3—Sub-section (ii)
प्राजधकार स ेप्रकाजित
PUBLISHED BY AUTHORITY
स.ं 61] नई दिल्ली, बृहस्ट्प जतिार, िनिरी 4, 2024/पौष 14, 1945
No. 61] NEW DELHI, THURSDAY, JANUARY 4, 2024/PAUSHA 14, 1945
जित्त मत्रं ालय
(रािस्ट्ि जिभाग)
(केन्द्रीय प्रत्यक्ष कर बोडड)
अजधसचू ना
नई दिल्ली, 4 िनिरी, 2024
का.आ. 66(अ).—केंरीय सरकार, आय-कर अजधजनयम, 1961 (1961 का 43) की धारा 10 के खंड (4छ) के
उपखंड (ii) द्वारा प्रित् त िजत यों का प्रयोग करत े हुए, अजनिासी द्वारा जित्तीय उत्पाि म ें जिजनधान के दियाकलाप को पूंिी
बािार मध्यिती द्वारा ऐस े अजनिासी के साथ की गई संजििा के अनुसार अजधसूजचत करती ह,ै िो अंतराडष्ट्रीय जित्तीय सेिा
केंर की एक इकाई ह,ै िहां धारा 80ठक की उपधारा (1क) म ें यथाजनर्िष्टड , ऐसे अंतराडष्ट्रीय जित्तीय सेिा केंर की अपतट
बैंककारी इकाई म ें अनुरजक्षत अजनिासी के खाते म ें ऐसे जिजनधान की आय प्राप्त की िाती ह ै।
स्ट्पष्टीकरण—इस अजधसूचना के प्रयोिनों के जलए,—
(i) ‘‘पूंिी बािार मध्यिती’’ का िही अथड होगा िो अंतराडष्ट्रीय जित्तीय सेिा केंर प्राजधकरण (पूंिी बािार मध्यिती)
जिजनयम, 2021 के जिजनयम 2 के उपजिजनयम (1) के खंड (छक) म ेंइसका ह ै;
124 GI/2024 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(ii)]
(ii) ‘‘जित्तीय उत्पाि’’ का िही अथड होगा िो अंतराडष्ट्रीय जित्तीय सेिा केंर प्राजधकरण अजधजनयम, 2019 (2019 का 50)
की धारा 3 की उपधारा (1) के खंड (घ) म ेंइसका ह ै;
(iii) ‘‘अंतराडष्ट्रीय जित्तीय सेिा केंर’’ का िही अथ ड होगा िो जििेष आर्थडक िोन अजधजनयम, 2005 (2005 का 28) की
धारा 2 के खंड (थ) म ें इसका ह ै;
(iv) ‘‘इकाई’’ का िही अथ ड होगा िो जििेष आर्थडक िोन अजधजनयम, 2005 (2005 का 28) की धारा 2 के खंड (यग) म ें
इसका ह ै।
[अजधसूचना स.ं 4/2024 फा. स.ं 370142/48/2023-टीपीएल]
सौरभ िैन, अिर सजचि [टीपीएल-I]
MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, the 4th January, 2024
S.O. 66(E).— In exercise of the powers conferred by sub-clause (ii) of clause (4G) of section 10 of the
Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies activity of investment in a financial
product by the non-resident, in accordance with a contract with such non-resident entered into by a capital market
intermediary, being a Unit of an International Financial Services Centre, where the income from such investment is
received in the account of the non-resident maintained with the Offshore Banking Unit of such International Financial
Services Centre, as referred to in sub-section (1A) of section 80LA.
Explanation.—For the purposes of this notification,—
(i) “capital market intermediary” shall have the meaning as assigned to it in clause (ga) of sub-regulation (1) of
regulation 2 of the International Financial Services Centres Authority (Capital Market Intermediaries)
Regulations, 2021;
(ii) “financial product” shall have the meaning as assigned to it in sub-clause (d) of sub-section (1) of section 3 of
International Financial Services Centres Authority Act, 2019 (50 of 2019);
(iii) “International Financial Services Centre” shall have the same meaning as assigned to it in clause (q) of section 2
of the Special Economic Zones Act, 2005 (28 of 2005);
(iv) “Unit” shall have the same meaning as assigned to it in clause (zc) of section 2 of the Special Economic Zones
Act, 2005 (28 of 2005).
[Notification No. 04/2024 F. No. 370142/48/2023-TPL]
SOURABH JAIN, Under Secy. (TPL-I)
Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064
and Published by the Controller of Publications, Delhi-110054.