Schedule VI — INCOME NOT TO BE INCLUDED IN TOTAL INCOME OF CERTAIN ELIGIBLE PERSONS IN INTERNATIONAL FINANCIAL SERVICES CENTRE OR HAVING INCOME THEREFROM

[See section 11]
INCOME NOT TO BE INCLUDED IN TOTAL INCOME OF
CERTAIN ELIGIBLE PERSONS IN INTERNATIONAL FINANCIAL
SERVICES CENTRE OR HAVING INCOME THEREFROM
In computing the total income of a tax year of any eligible person, as mentioned in
column C of the Table below, the income mentioned in column B of the said Table
and the income as mentioned in savings clause shall not be included, subject to the
conditions mentioned in column D of the said Table, and the expressions used in
columns B to D of the said Table, shall have the meanings respectively assigned to
them in the Notes below the said Table.
TABLE
Sl.
No.
Income not to be
included in total
income
Eligible
persons
Conditions
A B C D
1. Any income accrued
or arisen to, or re -
ceived, as a result of
transfer of capital
asset referred to in
section 70(1)(r) where
such transfer takes
place on a recognised
stock exchange locat-
ed in any Internation-
al Financial Services
Centre.
Any specified
fund.
( a) Consideration is paid or pay -
able in convertible foreign
exchange;
( b) Income shall not be included in
the total income to the extent
such income is attributable
to––
( i) units held by non-resi -
dent (not being the per-
manent establishment of
a non-resident in India);
or
( ii) the investment division
of offshore banking unit;
and
( c) The income exempt shall be
computed in such manner as
may be prescribed.
2. Any income accrued
or arisen to, or re -
ceived, as a result of
transfer of securities
(other than shares in
a company resident
in India).
Any specified
fund.
As specified in clauses (b) and (c) of
column D against Sl. No. 1.
3. Any income from se -
curities issued by a
non-resident where
such securities are not
issued by a permanent
establishment of a
non- resident in India.
Any specified
fund.
( a) Such income otherwise does
not accrue or arise in India;
( b) As specified in clauses ( b)
and ( c) of column D against
Sl. No. 1.
4. Any income from a
securitisation trust,
which is chargeable
under the head “Prof-
its and gains of busi -
ness or profession”.
Any specified
fund.
As specified in clauses (b) and (c) of
column D against Sl. No. 1.
5. Any income accrued
or arisen to, or re -
ceived as a result of—
Non-resident. ( a) Such contract, instrument or
derivative is entered into with
an offshore banking unit
Sl.
No.
Income not to be
included in total
income
Eligible
persons
Conditions
A B C D
( a) transfer of non-
deliverable for -
ward contracts
or offshore de -
rivative instru -
ments or over-
the-counter de -
rivatives; or
( b) distribution of
income on off -
shore derivative
instruments or
over-the-coun -
ter derivatives.
of an International Financial
Services Centre as referred to
in section 147 or any Foreign
Portfolio Investor being a unit
of an International Financial
Services Centre; and
( b) it fulfils such conditions, as
may be prescribed.
6. Any income by way of
royalty or interest on
account of lease of an
aircraft or a ship in a
tax year.
Non-resident. ( a) Such royalty or interest is paid
by a unit of an International
Financial Services Centre as
referred to in section 147;
and
( b) such unit has commenced its
operations on or before the
31st March, 2030.
7. Any income received
from––
( a) portfolio of se -
curities or finan-
cial products or
funds, managed
or administered
by any portfo -
lio manager on
behalf of the
non-resident; or
( b) such activity
carried out by
such person,
as may be no -
tified by the
Central Gov -
ernment.
Non-resident. ( a) Such income is received in
an account maintained with
an Offshore Banking Unit in
any International Financial
Services Centre as referred to
in section 147; and
( b) the income not to be included
in the total income shall be to
the extent such income accrues
or arises outside India and is
not deemed to accrue or arise
in India.
Sl.
No.
Income not to be
included in total
income
Eligible
persons
Conditions
A B C D
8. Any income by way
of Capital gains aris -
ing from the transfer
of equity shares of
domestic company
where such domestic
company is a Unit
of an International
Financial Services
Centre as referred to
in section 147.
A non-res -
ident, or a
Unit of an
Internation -
al Financial
Services Cen -
tre as referred
to in section
147, engaged
primarily in
the business
of leasing of
aircraft or a
ship.
( a) The domestic company—
( i) is engaged primarily in
the business of leasing
of an aircraft or a ship;
( ii) has commenced oper -
ations on or before the
31st March, 2030; and
( b) exclusion from total income
shall be available for capital
gains arising from the trans -
fer of equity shares of such
domestic company in a tax
year falling within—
( i) ten tax years beginning
with the tax year in which
the domestic company
has commenced opera -
tions; or
( ii) ten tax years beginning
with the tax year com -
mencing on the 1st April,
2023, where the period
referred to in sub-clause
(i) ends before the 1st
April, 2033.
9. Any income accru -
ing or arising to,
or received from a
specified fund or
on transfer of units
in a specified fund.
A unit holder
of a specified
fund.
Nil.
10. Any income of the na-
ture of Capital gains,
arising or received on
account of transfer of
share of a company
resident in India.
Any non-resi -
dent or a spec-
ified fund.
( a) The Capital gain is on account
of transfer of shares by the
resultant fund or a specified
fund; and
( b) such shares were transferred
from the original fund, or from
its wholly owned special pur-
pose vehicle, to the resultant
fund in relocation, and the
capital gains on such shares
were not chargeable to tax if
that relocation had not taken
place; and
Sl.
No.
Income not to be
included in total
income
Eligible
persons
Conditions
A B C D
( c) income not to be included in
the total income shall be to
the extent attributable to units
held by non-residents (not be-
ing a permanent establishment
of a non-resident in India) in
such manner, as may be pre -
scribed.
11. Any income by way
of dividends from a
company being a Unit
of an International
Financial Services
Centre primarily en -
gaged in the business
of leasing of an air -
craft or a ship.
A Unit of any
International
Financial Ser-
vices Centre.
Such Unit is primarily engaged in
the business of leasing of an aircraft
or a ship.
12. Any income by way of
interest payable.
Non- resident. Such interest is payable by a Unit
of an International Financial Ser -
vices Centre in respect of moneys
borrowed by it on or after the 1st
September, 2019.
Note 1: For the purposes of Sl. Nos. 1 to 4,––
( a) “convertible foreign exchange” means foreign exchange which is for the time
being treated by the Reserve Bank of India as convertible foreign exchange for
the purposes of the Foreign Exchange Management Act, 1999 (42 of 1999) and
the rules made thereunder;
( b) “investment division of offshore banking unit” means an investment division of
a banking unit of a non-resident located in an International Financial Services
Centre as referred to in section 147 and which has commenced its operations on
or before the 31st March, 2030;
( c) “manager” shall have the same meaning as assigned to it in regulation 2(1)( q)
of the Securities and Exchange Board of India (Alternative Investment Funds)
Regulations, 2012 made under the Securities and Exchange Board of India Act,
1992 (15 of 1992);
( d) “permanent establishment” shall have the meaning assigned to it in section 173(c);
( e) “securities” shall have the same meaning as assigned to it in section 2( h) of the
Securities Contracts (Regulation) Act, 1956 (42 of 1956) and shall also include
such other securities or instruments as may be notified by the Central Government
in this behalf;
( f) “securitisation trust” shall have the meaning assigned to it in section
221(6)(d);
( g) “specified fund” means—
( i) a fund established or incorporated in India in the form of a trust or a
company or a limited liability partnership or a body corporate and located
in International Financial Services Centres,—
( A) which has been granted a certificate of registration as a Category III
Alternative Investment Fund and is regulated––
( I) under the Securities and Exchange Board of India
(Alternative Investment Funds) Regulations, 2012 made under
the Securities and Exchange Board of India Act, 1992 (15 of
1992);
( II) under the International Financial Services Centres Authority
(Fund Management) Regulations, 2022 made under the Inter-
national Financial Services Centres Authority Act, 2019 (50 of
2019); or
( B) which has been granted a certificate as a retail scheme or an Exchange
Traded Fund, and satisfies the conditions laid down for such schemes
or funds under the International Financial Services Centres Authority
(Fund Management) Regulations, 2022 made under the International
Financial Services Centres Authority Act, 2019 (50 of 2019);
41[(C) of which all the units other than the unit held by a sponsor or manager
are held by non-residents except,––
( I) where such non-resident becomes resident under section 6(2) or
(3) or (4) or (5) or (6) or (7) in any tax year subsequent to that
tax year; and
( II) the number of units held by such resident unit holder or holders
do not exceed 5% of the total units issued and shall fulfil such
other conditions as may be prescribed; or]
( ii) investment division of an offshore banking unit, which has been—
( A) granted a certificate of registration as a Category-I foreign portfolio
investor under the Securities and Exchange Board of India (Foreign
Portfolio Investors) Regulations, 2019 made under the Securities
and Exchange Board of India Act, 1992 (15 of 1992) and which has
commenced its operations on or before the 31st March, 42[2030]; and
41. Substituted for the following by the Finance Act, 2026, w.e.f. 1-4-2026 :
“of which all the units are held by non-residents except––
( I) the unit held by a sponsor or manager;
( II) where any unit holder or holders, being non-resident during the tax year when such
unit or units were issued, becomes resident under section 6(2) or (3) or (4) or (5) or
(6) or (7) in any tax year subsequent to that year;
( III) in case of sub-item (II), aggregate value and the number of units held by such resident
unit holder or holders do not exceed 5% of the total units issued and shall fulfil such
other conditions as may be prescribed; or”
42. Substituted for “2025” by the Finance Act, 2026, w.e.f. 1-4-2026.
( B) fulfils such conditions including maintenance of separate accounts
for its investment division, as may be prescribed;
( h) “sponsor” shall have the same meaning as assigned to it in regulation 2(1)( w)
of the Securities and Exchange Board of India (Alternative Investment Funds)
Regulations, 2012 made under the Securities and Exchange Board of India Act,
1992 (15 of 1992);
( i) “trust” means a trust established under the Indian Trusts Act, 1882 (2 of 1882)
or under any other law;
( j) “units” mean beneficial interest of an investor in the fund and shall
include shares or partnership interests.
Note 2: For the purposes of Sl. No. 5,––
“Foreign Portfolio Investor” shall mean a person registered as per the provisions
of the Securities and Exchange Board of India (Foreign Portfolio Investors)
Regulations, 2019 made under the Securities and Exchange Board of India Act,
1992 (15 of 1992).
Note 3: For the purposes of Sl. Nos. 6, 8 and 11,––
( a) “aircraft” means an aircraft or a helicopter, or an engine of an aircraft or a heli-
copter, or any part thereof;
( b) “ship” means a ship or an ocean vessel, engine of a ship or ocean vessel, or any
part thereof.
Note 4: For the purposes of Sl. No. 7,––
“portfolio manager” shall have the same meaning as assigned to it
in regulation 2(1)( z) of the International Financial Services Centres
Authority (Capital Market Intermediaries) Regulations, 2021 made under the
International Financial Services Centres Authority Act, 2019 (50 of 2019).
Note 5: For the purposes of Sl. No. 9,––
( a) “specified fund” shall have the same meaning as assigned to it in Note 1(g);
( b) “unit” means beneficial interest of an investor in the fund and shall include shares
or partnership interests.
Note 6: For the purposes of Sl. No. 10,––
( a) “original fund”, “relocation” and “resultant fund” shall have the meanings respec-
tively assigned to them in section 70(2);
( b) “specified fund” shall have the meaning assigned to it in Note 1(g).
Note 7: For the purposes of Sl. No. 12,––
“Unit” shall have the same meaning as assigned to it in section 2(zc) of the Special
Economic Zones Act, 2005 (28 of 2005).