The central board of Direct tax “CBDT” vide Notification No. 119/2021 dated 11.10.2021 in order to ease the compliance burden has exempted certain class of persons from the obligation of furnishing income tax return under section 139(1) of the Income Tax Act,1961 subject to certain conditions. This notification is effective from A.Y. 2021-22 onwards.
| S. No. | Class of Persons | Conditions |
| 1 | (i) a non-resident, not being a company; or (ii) a foreign company. | The class of person should not earn any income other than income from investment in ‘specified fund’, being Alternate Investment Fund Category III located in International Financial Services Centres and The class of person is exempted from the requirement of obtaining a permanent account number as required under section 139A of the Act. |
| 2 | a non-resident, being an eligible foreign investor. | The class of person has affected transaction and earned income only in respect of capital assets as Global Depository Receipts, Rupee Denominated Bonds, derivatives or other notified securities as specified under clause (viiab) of section 47 of the Act and The class of persons has furnished the Specified details and documents* to the to the stock broker through which the transaction has been executed. |
The aforementioned exemption shall not be available in a case wherein a notice has been issued under subsection (1) of section 142 or section 148 or section 153A or section 153C of the said Act has been issued for filing a return of income for the assessment year specified therein.
*Specified Details and documents to be submitted to stock broker means the following details:
This move of the government clearly demonstrates that the government want to reduce the compliance
burdens so as to push the foreign investors to invest and earn.
