Continuous Discharge Certificate for member of crew of ship – New rule inserted in income tax rules for the purpose of determining period of stay in India for residential status of an individual being a citizen of India and a member of the crew of a ship.
For the purpose of determining the period or period of stay in India pursuant to explanation 2 inserted by Finance Act, 2015 to sub section (1) to Section 6 in the case of an individual, being a citizen of India and a member of the crew of a foreign bound ship leaving India, rule 126 has been inserted with retrospective effect from 01.04.2015
You can read here about it know more.According to section 6(1) provides the condition for determination of residential status of the individual in India which inter alia depends on the number of days during which such individual stayed in India during the previous year. To avoid the uncertainty regarding determination of period of stay in India for crew members being Indian citizen in case of foreign bound ships having the destination of voyage outside India, section 6(1) has been amended to provide that in the case of an individual, being a citizen of India and a member of crew of foreign bound ship leaving India, the period or periods of stay in India shall be determined in the manner and subject to conditions as may be prescribed by the Central Board of Direct Taxes (CBDT). Now the Rule 126 ”Computation of period of stay in India in certain cases” has been inserted under income tax rules for the said purpose.
The said rule seeks to exclude the period of stay in India on the basis of “Continuous Discharge Certificate” issued by shipping master in Form 1. The period which shall not be included shall be period beginning on the date entered into this certificate in respect of joining the ship by the individual and ending on the date entered into this certificate in respect of signing off by that individual from the ship in respect of an eligible voyage undertaken by a ship in the carriage of passengers or freight in international traffic where for the voyage having originated from any port in India, has as its destination any port outside India; and for the voyage having originated from any port outside India, has as its destination any port in India.
Please note this rule has been retrospectively inserted w.e.f A.Y 2015-2016 and as such it is advisable while filing the income tax return form for the A.Y.2015-2016 by the individual being a citizen of India and a member of the crew of a foreign bound ship leaving India, continuous Discharge certificate shall be looked into. It is also known as “Continuous Discharge certificate –cum-Seafarers Identity Document (CDC)” .Certificate contains inter-alia details like date and place of engagement, date and place of discharge, Name of ship, Official number and tonnage, category, description of voyage, signature of shipping master, consular officer with official stamp,etc. The rule inserted by the Income –tax (twelfth Amendment /rules, 2015 is reproduced below:
Computation of period of stay in India in certain cases (Rule 126)
- (1) For the purposes of clause (1) of section 6, in case of an individual, being a citizen of India and a member of the crew of a ship, the period or periods of stay in India shall, in respect of an eligible voyage, not include the period computed in accordance with sub-rule (2).
(2) The period referred to in sub-rule (1) shall be the period beginning on the date entered into the Continuous Discharge Certificate in respect of joining the ship by the said individual for the eligible voyage and ending on the date entered into the Continuous Discharge Certificate in respect of signing off by that individual from the ship in respect of such voyage.
Explanation : For the purposes of this rule,—
(a) “Continuous Discharge Certificate” shall have the meaning assigned to it in the Merchant Shipping (Continuous Discharge Certificate-cum-Seafarer’s Identity Document) Rules, 2001 made under the Merchant Shipping Act, 1958 (44 of 1958);
(b) “eligible voyage” shall mean a voyage undertaken by a ship engaged in the carriage of passengers or freight in international traffic where—
(i) for the voyage having originated from any port in India, has as its destination any port outside India; and
(ii) for the voyage having originated from any port outside India, has as its destination any port in India.
