TAX-FREE INCOMES FOR SALARIED TAXPAYERS
There are various knowledge sharing materials which are provided by the Income Tax Department for the update of the member. It acts as a guide to the taxpayers, tax professional & tax authorities in making the due compliances. One such knowledge sharing content is with regard to Tax free income for salaried taxpayers under the provision of Income Tax Act – 1961. Let us know more about it.
Allowance/perquisites to Government employee outside India [Section 10(7)]
As per section 10(7), any allowances or perquisites paid or allowed as such outside India by the Government to a citizen of India for rendering service outside India is exempt from tax.
Income of a family member of an employee serving under co-operative technical assistance programme [Section 10(9)]
As per section 10(9), the income of any member of the family of any such individual as is referred to in section 10(8)/(8A)/(8B) accompanying him to India, which accrues or arises outside India and is not deemed to accrue or arise in India, in respect of which such member is required to pay any income or social security tax to the Government of that foreign State or country of origin of such member, as the case may be, is exempt from tax.
Death-cum-retirement gratuity received by Government servants [Section 10(10)(i)]
Section 10(10)(i) grants exemption to gratuity received by Government employees (i.e., Central Government or State Government or local authority).
Gratuity received by a non-Government employee covered by Payment of Gratuity Act, 1972 [Section 10(1 0)(ii)]
As per section 10(10)(ii), exemption in respect of gratuity in case of employees covered by the Payment of Gratuity Act, 1972 will be lower of following :
- 15 days’ salary × years of service.
- Maximum amount specified, i.e., Rs. 20,00,000*.
- Gratuity actually received.
* Limit increased from Rs. 10 lakhs to Rs. 20 lakhs vide Notification No. 1420(E), dated 29-3-2018.
Note:
1) Instead of 15 days’ salary, only 7 days salary will be taken into consideration in case of employees of seasonal establishments.
2) 15 days’ salary = Salary last drawn × 15/26
3) Salary for this purpose will include basic salary and dearness allowance only. Items other than basic salary and dearness allowance are not to be considered.
4) In case of a piece rated employee, 15 days’ salary will be computed on the basis of average of total wages (excluding overtime wages) received for a period of three months immediately preceding the termination of his service.
5) Part of the year, in excess of 6 months, shall be taken as one full year.
Gratuity received by a non-Government employee not covered by Payment of Gratuity Act, 1972 [Section 10(10)(iii)]
As per section 10(10)(iii), exemption in respect of gratuity in case of employees not covered by the Payment of Gratuity Act, 1972 will be lower of following :
- Half month’s salary for each completed year of service, i.e.,
[Average monthly salary × 1/2] × Completed years of service. .
- Rs. 10,00,000.
- Gratuity actually received.
Note:
1) Average monthly salary is to be computed on the basis of average salary for 10 months immediately preceding the month of retirement.
2) Salary for this purpose will include basic salary, dearness allowance, if the terms of service so provide and commission based on fixed percentage of turnover achieved by the employee.
3) While computing years of service, any fraction of a year is to be ignored.
Pension [Section 10(10A)]:
As per section 10(10A), any commuted pension, i.e., accumulated pension in lieu of monthly pension received by a Government employee is fully exempt from tax. Exemption is available only in respect of commuted pension and not in respect of un-commuted, i.e., monthly pension. Exemption in respect of commuted pension in case of a non-Government employee will be as follows:
- If the employee receives gratuity, one third of the full value of the commuted pension will be exempt from tax under section 10(10A).
- If the employee does not receive gratuity, one half of the full value of the commuted pension will be exempt from tax under section 10(10A).
Leave salary [Section 10(10AA)]
As per section 10(10AA), leave encashment by a Government employee at the time of retirement (whether on superannuation or otherwise) is exempt from tax. In the hands of non-Government employee exemption will be least of the following:
- Period of earned leave standing to the credit in the employee’s account at the time of retirement (*) × Average monthly salary ($).
- Average monthly salary ($) × 10 (e., 10 months’ average salary).
- Maximum amount as specified by the Government, e., Rs. 3,00,000.
- Leave encashment actually received at the time of retirement.
(*)Leave credit to the account of the employee at the time of retirement should be restricted to 30 days per year of service if leave entitlement as per service rules exceeds 30 days per year of actual service.
($) Salary for the above purpose means average salary drawn in the past ten months immediately preceding the retirement (i.e., preceding the day of retirement) and will include basic salary, dearness allowance (if considered for computing all the retirement benefits) and commission based on fixed percentage of turnover achieved by the employee.
Apart from the above items, salary for this purpose does not include any other allowances or perquisites.
Retrenchment compensation [Section 10(10B)]
As per section 10(10B), compensation received at the time of retrenchment is exempt from tax to the extent of lower of the following:
(a) An amount calculated in accordance with the provisions of section 25F(b) of the Industrial Dispute Act, 1947; or
(b) Maximum amount specified by the Central Government (Rs. 5,00,000);
(c) Actual amount received.
Under the Industrial Dispute Act, a workman is entitled to retrenchment compensation, equal to 15 days’ average pay for each completed year of continuous service or any part in excess of six months.
Compensation in excess of aforesaid limits is taxable as salary. However, the aforesaid limit is not applicable in cases where compensation is paid under any scheme approved by the Central Government.
Compensation for Bhopal Gas Leak Disaster [Section 10(10BB)]
Compensation [in accordance with Bhopal Gas Leak Disaster (Processing of Claims) Act, 1985] received by victims of Bhopal gas leak disaster is exempt from tax. However, compensation received for any expenditure which is allowed as deduction from taxable income is not exempt.
Compensation on account of any disaster [Section 10(1 0BC)]
Any amount received from the Central Government or State Government or a Local Authority by an individual or his legal heirs as compensation on account of any disaster is exempt from tax. However, no deduction is available in respect of the amount received or receivable to the extent such an individual or his legal heirs has been allowed a deduction under the Act on account of loss or damage caused due to such disaster. Disaster here means any disaster due to any natural or man-made causes or by accident/negligence which results in substantial loss of human life or damage to property or environment and the magnitude of such disaster is beyond the coping capacity of the community of the affected area.
Payment at the time of voluntary retirement [Section 10(10C)]
As per section 10(10C), any compensation received at the time of voluntary retirement or termination of service is exempt from tax, if the following conditions are satisfied:
- Compensation is received at the time of voluntary retirement or termination (or in the case of an employee of a public sector Company, at the time of voluntary separation).
- Compensation is received by an employee of following undertakings-
- a) public sector company ; or
- b) any other company ; or
- c) an authority established under a Central, State or Provincial Act ; or
- d) a local authority ; or
- e) a co-operative society ; or
- f) a University established or incorporated by or under a Central, State or Provincial Act and an institution declared to be a University under section 3 of the University Grants Commission Act, 1956 (3 of 1956) ; or
- g) an Indian Institute of Technology within the meaning of clause (g) of section 3 of the Institutes of Technology Act, 1961 (59 of 1961) ; or
- h) any State Government; or
- i) the Central Government; or
- j) Notified institutes having importance throughout India or in any State or States,
- k) Notified institute of management
- Compensation is received in accordance with the scheme of voluntary retirement/separation, which is framed in accordance with guidelines prescribed under Rule 2BA of Income-tax Rules, 1962*.
- Where exemption is allowed to an employee under section 10(10C) for any assessment year, no exemption under this section shall be allowed to him for any other assessment year.
- With effect from assessment year 2010-11, section 10(10C) has been amended to provide that where any relief has been allowed to an assessee under section 89 for any assessment year in respect of any amount received or receivable on his voluntary retirement or termination of service or voluntary separation, no exemption under section 10(10C) shall be allowed to him in relation to such or any other assessment year.
*Guidelines prescribed under Rule 2BA of Income-tax Rules. 1962
Voluntary retirement scheme should be framed in accordance with the following guidelines:
- it should apply to an employee who has completed 10 years of service or completed 40 years of age. This requirement would not be in case of amount received by an employee of a public sector company under the scheme of voluntary separation framed by such public sector company.
- it should apply to all employees (by whatever name called) including workers and executives of a company or of an authority or of a co-operative society, as the case may be, excepting directors of a company or of a co-operative society;]
iii. the scheme of voluntary retirement or voluntary separation should be drawn to result in overall reduction in the existing strength of the employees;
- the vacancy caused by the voluntary retirement or voluntary separation is not to be filled up;
- the retiring employee of a company shall not be employed in another company or concern belonging to the same management
- the amount receivable on account of voluntary retirement or voluntary separation of the employee does not exceed the amount equivalent to
3 months salary for each completed year of service or
salary at the time of retirement multiplied by the balance months of service left before the date of his retirement
Salary for this purpose will include basic salary, dearness allowance, if the terms of service so provide and commission based on fixed percentage of turnover achieved by the employee.
Tax on perquisites paid by the employer [Section 10(10 CC)]
Perquisites to employees mean any facility provided by the employer to the employees. There are two types of perquisites, viz., monetary and non-monetary. Value of perquisite is charged to tax in the hands of the employees, however, the employer may at his will pay tax (on behalf of employees) on such perquisites. In such a case, the amount of tax paid on such perquisites by the employer on behalf of the employees will be treated as income of the employees and is charged to tax in his (i.e., in employee’s) hands. However, by virtue of section 10(10CC) tax paid by employer (on behalf of employee) on non-monetary perquisites will be exempt from tax in the hands of employees.
Such tax paid by the employer shall not be allowed as a deductible expenditure in the hands of employer under section 40. Section 10(10CC) provides exemption only in respect of tax on non-
monetary perquisites. In other words, this section does not provide exemption in respect of perquisites or tax paid on monetary perquisites.
Amount paid on life insurance policy [Section 10(10D)]
As per section 10(10D), any amount received under a life insurance policy, including bonus is exempt from tax. Following points should be noted in this regard:
- Exemption is available only in respect of the amount received from life insurance policy.
- Exemption under section 10(10D) is unconditionally available in respect of sum received for a policy which is issued on or before March 31, 2003. However, in respect of policies issued on or after April 1st, 2003, the exemption is available only if the amount of premium paid on such policy in any financial year does not exceed 20% (10% in respect of policy taken on or after 1st April, 2012) of the actual capital sum assured. With effect from 1-4-2013, in respect of policy taken in the name of a person suffering from diseases specified under section 80DDB or in the name of a person suffering from disability specified under section 80U, the limit will be increased to 15% of capital sum assured.
- Value of premium agreed to be returned or of any benefit by way of bonus (or otherwise), over and above the sum actually assured, which is received under the policy by any person, shall not be taken into account while calculating the actual capital sum assured.
- Amount received on death of the person will continue to be exempt without any condition.
Note 1: No exemption would be available in case of any sum received under section 80DD(3) or under Keyman insurance policy.
Note 2: w.e.f. Assessment Year 2021-22, any sum received from Unit Linked Insurance Plan (ULIP) is not entitled for exemption if such ULIP is issued on or after 01-02-2021 and the amount of premium payable for any of the previous year during the term of such policy exceeds 2,50,000.
Further, if premium is payable by a person for more than one ULIP, issued on or after 01-022021, the exemption under Section 10(10D) shall be available in respect to those ULIPs, where the aggregate amount of premium does not exceed Rs. 2,50,000 in any of the previous year during the term of any of those policies.
Exemption in respect of amount received from public provident fund/statutory provident fund/ recognised provident fund/ un-recognised provident fund [Section 10(11)/(12)]
The tax treatment of various items in case of different provident funds is as follows:
Statutory Provident Fund
| Employer’s Contribution | Employer’s contribution to such fund is not treated as income of the employee. |
| Interest | Interest credited to such a fund is exempt in the hands of the employee. [see note 4] |
| Amount received at the time of termination | Lump sum amount received from such a fund, at the time of termination of service is exempt in the hands of employees. |
Recognised Provident Fund
| Employer’s Contribution | Employer’s contribution to such fund, up to 12% of salary is not treated as income of the employee (see Note 1). |
| Interest | Interest credited to such fund up to 9.5% per annum is exempt in the hands of the employee, interest in excess of 9.5% is charged to tax in the hands of the employee. [see note 4] |
| Amount received termination at the time of | If certain conditions are satisfied, then the lump sum amount received from such a fund, at the time of termination of service, is exempt in the hands of employees. (see Note 2) |
Un-recognised Provident Fund
| Employer’s Contribution | Employer’s contribution to such fund is not treated as income of the employee. |
| Interest | Interest credited to such fund is exempt in the hands of the employees. [see note 4] |
| Amount received termination at the time of | (See note 3) |
Public Provident Fund
| Employer’s Contribution | Employers do not contribute to such fund. |
| Interest | Interest credited to such fund is exempt. |
| Amount received at the time of termination |
Lump sum amount received from such a fund at the time of termination of service is exempt from tax. |
Notes:
- Salary for this purpose will include basic salary, dearness allowance, if the terms of service so provide and commission based on fixed percentage of turnover achieved by the employee.
- Accumulated balance paid from a recognised provident fund will be exempt from tax in following cases:
(a) If the employee has rendered a continuous service of 5 years or more. If the accumulated balance includes amount transferred from other recognised provident fund maintained by the previous employer, then the period for which the employee rendered service to such previous employer shall also be included in computing the aforesaid period of 5 years.
(b) If the service of an employee is terminated before the period of 5 years, due to his ill health or discontinuation of business by the employer or other reason beyond his control.
(c) If on retirement, the employee takes employment with any other employer and the balance due and payable to him is transferred to his individual account in any recognised fund maintained by such other employer, then the amount so transferred will not be charged to tax.
Except above situations, payment from a recognised provident fund will be charged to tax considering such a fund as un-recognised from the beginning (See note 3 given below for tax treatment of un-recognised provident fund).
- Treatment of payment (at the time of termination) from un-recognised provident fund:
Payment on termination will include 4 things, viz., employee’s contribution and interest thereto and employer’s contribution and interest thereto, the tax treatment of such payment is as follows:
- Employee’s contribution is not chargeable to tax; interest on employee contribution is taxed under the head “Income from other sources”.
- Employer’s contribution and interest thereon are taxed as salary income, however, an employee can claim relief under section 89 in respect of such payment.
- No exemption shall be available for the interest income accrued during the previous year in the recognized and statutory provident fund to the extent it relates to the contribution made by the employees over Rs. 2,50,000 in the previous year. However, if an employee is contributing to the fund but there is no contribution to such fund by the employer, then the interest income accrued during the previous year shall be taxable to the extent it relates to the contribution made by the employee to that fund in excess of Rs. 5,00,000 in a financial year.
Payment from account opened in accordance with the Sukanya Samriddhi Account Rules, 2014 [Section 10(11A)]
As per section 10(11A), any payment from an account opened in accordance with the Sukanya Samriddhi Account Rules, 2014 made under the Government Savings Bank Act, 1873 is exempt from tax. In other words, interest and withdrawals from such an account will be exempt from tax under section 10(11A).
Payment from the National Pension System Trust to an employee [Section 10(12A)]
Any payment from the National Pension System Trust to an assessee on closure of account or his opting out of the pension scheme referred to in section 80CCD, to the extent it does not exceed 40 % of the total amount payable to him at the time of closure or his opting out of the scheme, is exempt from tax.
With effect from April 01, 2020, 60 % of the amount payable shall be exempt from tax. Partial withdrawal from NPS [Section 10(12B)]
To provide relief to an employee withdrawing partial amount from National Pension System (NP S) Trust. A new clause (12B) is inserted under section 10 with effect from assessment year 2018-19 to provide that the withdrawal from NPS will not be chargeable to tax if the following conditions are satisfied:-
- Amount of withdrawal should not exceed 25% of the total contribution made by an employee in NPS.
- Partial withdrawal should be made in accordance with the terms and conditions specified under the Pension Fund Regulatory and Development Authority Act, 2013 and the regulations made thereunder.
Payment from approved superannuation fund in specified circumstances and subject to certain limits [Section 10(13)]
Approved superannuation fund means superannuation fund which is approved by the Commissioner of Income-tax. Tax treatment of such fund is as follows:
- Employer’s contribution is exempt from tax, however, from assessment year 2010-11 employer’s contribution in excess of Rs. 1,50,000 per annum is charged to tax as perquisite. Employee’s contribution qualifies for deduction under section 80C and interest on accumulated balance is not liable to tax.
- Payments made from the fund are exempt from tax under section 10(13) in following cases:
Payment on death of beneficiary; or
Payment to employee in lieu of, or in commutation of an annuity on his retirement at or after the specified age or on his becoming incapable prior to such retirement; or
Payment by way of refund of contributions on the death of a beneficiary; or
Payment to employee by way of refund of his contributions on leaving the service in connection with which the fund is established otherwise than by retirement at or after a specified age or on his becoming incapacitated prior to such retirement; or
Payment to employee by way of transfer to his account under a pension scheme referred to in section 80CCD.
House rent allowance [Section 10(13A)]
As per section 10(13A), read with rule 2A, the exemption in respect of HRA will be lower of the following amounts:
(1) 50% of salary, when residential house is situated at Mumbai, Kolkata, Delhi or Chennai and 40% of salary where a residential house is situated at any other place.
(2) HRA actually received by the employee in respect of the period during which rental accommodation was occupied by the employee during the previous year.
(3) Rent paid in excess of 10% of salary.
Salary will include basic salary, dearness allowance forming part of salary while computing all retirement benefits and commission based on fixed percentage of turnover achieved by the employee. Apart from this, salary for this purpose does not include any other allowances/perquisites.
Salary for this purpose shall be computed on due basis in respect of period during which the accommodation is occupied by the employee in the previous year. Hence, any payments not pertaining to the previous year or not pertaining to the period of occupation of the accommodation shall be excluded.
Prescribed allowances or benefits [Section 10(14)] exempt from tax subject to certain limit:
| Allowances | Exemption Limit |
| Children Education Allowance | Up to Rs. 100 per month per child up to a maximum of 2 children is exempt |
| Hostel Expenditure Allowance | Up to Rs. 300 per month per child up to a maximum of 2 children is exempt |
| Transport Allowance granted to an employee to (who is a blind and handicap) meet expenditure on commuting between place of residence and place of duty | Rs. 3,200 per month for blind and handicapped employees is exempt |
| Allowance granted to an employee working in any transport business to meet his personal expenditure during his duty performed in the course of running of such transport from one place to another place provided the employee is not in receipt of daily allowance. | Amount of exemption shall be lower of following:
a) 70% of such allowance; or b) Rs. 10,000 per month. |
| Conveyance Allowance granted to meet the expenditure on conveyance in performance of duties of an office | Exempt to the extent of expenditure incurred for official purposes |
| Travelling Allowance to meet the cost of travel on tour or on transfer | Exempt to the extent of expenditure incurred for official purposes |
| Daily Allowance to meet the ordinary daily charges incurred by an employee on account of absence from his normal place of duty | Exempt to the extent of expenditure incurred for official purposes |
| Helper/Assistant Allowance | Exempt to the extent of expenditure incurred for official purposes |
| Research Allowance granted for encouraging the academic research and other professional pursuits | Exempt to the extent of expenditure incurred for official purposes |
| Uniform Allowance | Exempt to the extent of expenditure incurred for official purposes |
| Special compensatory Allowance (Hilly Areas) (Subject to certain conditions and locations) | Amount exempt from tax varies from Rs. 300 to Rs. 7,000 per month. |
| Border area, Remote Locality or Disturbed Area or | Amount exempt from tax varies from Rs. |
| Difficult Area Allowance (Subject to certain conditions and locations) | 200 to Rs. 1,300 per month. |
| Tribal area allowance in (a) Madhya Pradesh (b) Tamil Nadu (c) Uttar Pradesh (d) Karnataka (e) Tripura (f) Assam (g) West Bengal (h) Bihar (i) Orissa | Up to Rs. 200 per month |
| Compensatory Field Area Allowance. If this exemption is taken, employee cannot claim any exemption in respect of border area allowance (Subject to certain conditions and locations) | Up to Rs. 2,600 per month |
| Compensatory Modified Area Allowance. If this exemption is taken, employee cannot claim any exemption in respect of border area allowance (Subject to certain conditions and locations) | Up to Rs. 1,000 per month |
| Counter Insurgency Allowance granted to members of Armed Forces operating in areas away from their permanent locations. If this exemption is taken, employee cannot claim any exemption in respect of border area allowance (Subject to certain conditions and locations) | Up to Rs. 3,900 per month |
| Underground Allowance to employees working in uncongenial, unnatural climate in underground mines | Up to Rs. 800 per month |
| High Altitude Allowance granted to armed forces operating in high altitude areas (Subject to certain conditions and locations) | a) Up to Rs. 1,060 per month (for altitude of 9,000 to 15,000 feet)
b) Up to Rs. 1,600 per month (for altitude above 15,000 feet) |
| Highly active field area allowance granted to members of armed forces (Subject to certain conditions and locations) | Up to Rs. 4,200 per month |
| Island Duty Allowance granted to members of armed forces in Andaman and Nicobar and Lakshadweep group of Island (Subject to certain conditions and locations) | Up to Rs. 3,250 per month |
Interest on securities [Section 10(15)]
Interest incomes which are exempt under section 10(15) could be explained with the help of the following table-
| Section | Income | Exemption to |
| 10(15)(i) | Interest, premium on redemption, or other payment on notified securities, bonds, certificates, and deposits, etc. (subject to notified conditions and limits) | All assessees |
| 10(15)(iib) | Interest on notified Capital Investment Bonds notified prior to 1-6-2002 | Individual/HUF |
| 10(15)(iic) | Interest on notified Relief Bonds | Individual/HUF |
| 10(15)(iid) | Interest on notified bonds (notified prior to 1-6-2002) purchased in foreign exchange (subject to certain conditions) |
Individual – NRI/ nominee or survivor of NRI/individual to whom bonds have been gifted by NRI |
| 10(15)(iii) | Interest on securities | Issue Department of Central Bank of Ceylon |
| 10(15)(iiia) | Interest on deposits made with scheduled bank with approval of RBI | Bank incorporated abroad |
| 10(15)(iiib) | Interest payable to Nordic Investment Bank | Nordic Invstment Bank |
| 10(15)(iiic) | 10(15)(iiic) Interest payable to the European Investment Bank on loan granted by it in pursuance of framework- agreement dated 25-11-1993 for financial corporation between Central Government and that bank |
European Investment Bank |
| 10(15)(iv)(a) | Interest received from Government or from local authority on moneys lent to it before 1-6-2001 or debts owed by it before 1-6-2001, from sources outside India | All assessees who have lent money, etc., from sources outside India |
| 10(15)(iv)(b) | Interest received from industrial undertaking in India on moneys lent to it under a loan agreement entered into before 1-6-2001 | Approved foreign financial institution |
| 10(15)(iv)(c) | Interest at approved rate received from Indian industrial undertaking on moneys lent or debt incurred before 1-6- 2001 in a foreign country in respect of purchase outside India of raw materials, components or capital plant and machinery, subject to certain limits and conditions | All assessees who have lent such money, or in favour of whom such debt has been incurred |
| 10(15)(iv)(d) | Interest received at approved rate from specified financial institutions in India on moneys lent from sources outside India before 1-6-2001 |
All assessees who have lent such moneys |
| 10(15)(iv)(e) | Interest received at approved rate from other Indian financial institutions or banks on moneys lent for specified purposes from sources outside India before 1- 6-2001 under approved loan agreement | All assessees who have lent such moneys |
| 10(15)(iv)(f) | Interest received at approved rate from Indian industrial undertaking on moneys lent in foreign currency from sources outside India under loan agreement approved before 1-6-2001 | All assessees who
have lent such |
| 10(15)(iv)(fa) | Interest payable by scheduled bank, on deposits in foreign currency when acceptance of such deposits by bank is approved by RBI | Non-resident or
individual/HUF who is not ordinarily |
| 10(15)( iv)(g) | Interest received at approved rate, from Indian public companies eligible for deduction under section 36(1)(viii) and formed with main object of providing long-term housing finance, on moneys lent in foreign currency from sources outside India under loan agreement approved before 1-6-2003 |
All assessees who have lent such moneys |
| 10(15)( iv)(h) | Interest received from any public sector company in respect of notified bonds or debentures and subject to certain conditions | All assessees |
| 10(15)( iv)(i) | Interest received from Government on deposits in notified scheme out of moneys due on account of retirement | Individual – Employee of Central Government/State Government/Public sector company |
| 10(15)(v) | Interest on securities held in Reserve Bank’s SGL A/c No. SL/DH-048 and Deposits made after 31-3-1994 for benefit of victims of Bhopal Gas Leak Disaster held in such account with RBI or with notified public sector bank | Welfare Commissioner, Bhopal Gas Victims, Bhopal |
| 10(15)(vi) | Interest on Gold Deposit Bonds issued under the Gold Deposit Scheme, 1999 or deposit certificates issued under the Gold Monetisation Scheme, 2015 |
All assessees |
| 10(15)(vii) | 10(15)(vii) Interest on notified bonds issued by a local authority/State Pooled Finance Entity | All assessees |
| 10(15)(viii) | Interest on deposit made on or after 1-4-2005 in an Offshore Banking Unit referred to in section 2(u) of the Special Economic Zones Act, 2005 | Non-resident or person who is not ordinarily resident |
| 10(15)(ix) | Interest payable by a unit located in an International Financial Services Centre in respect of monies borrowed by it on or after the 1st day of September, 2019. | Non-resident |
Educational scholarship [Section 10(16)]
Any amount received as educational scholarship (i.e., scholarship to meet the cost of education is exempt from tax in the hands of recipient).
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