Question – Residential status of a company – How should it be determined ?
Answer –
A company is said to be resident in India in any previous year, if : –
it is an Indian company; or
its Place of Effective Management (‘POEM’), in that year, is in India.
Thus, an Indian Company would always a tax resident of India irrespective of whether, the control and management of its affairs, is situated partly in India, wholly in India or wholly outside India.
However, in case of a foreign company, it would be considered as a tax resident of India, only when its Place of Effective Management (‘POEM’), in that year, is in India.
