Rule 126 of Income Tax Rules, 1962 – Computation of period of stay in India in certain cases

According to section 6 (1) of the Income Tax Act, 1961, the period of stay of an Indian citizen who is a crew member of a ship determines that individual’s residential status. In order to compute this period of stay in a uniform and consistent manner, Rule 126 has been prescribed.

Rule 126 states the following:

1. The period or periods of stay in India for an Indian citizen who is also a crew member of a ship must not, with regard to an eligible voyage, include the period calculated in accordance with the next rule.
2. The above mentioned period is the period that starts on the date that the said individual joins the ship for the eligible voyage and ends on the date that the said individual signs off from the ship for the said voyage as recorded in the Continuous Discharge Certificate.

“Continuous Discharge Certificate” is defined in the Merchant Shipping (Continuous Discharge Certificate-cum-Seafarer’s Identity Document) Rules, 2001 under the Merchant Shipping Act, 1958.

“Eligible Voyage” is a voyage for carriage of passengers or freight in international traffic when a voyage originating from a port in India has its destination at a port outside India and vice versa.