707/CBDT. - Income Tax - 707/CBDT

INSTRUCTION NO. 707/CBDT Dated : June 15, 1974 Section(s) Referred: 80RR Statute: Income - Tax Act, 1961 Where the gross total income of an individual resident in India, being an author, playwright, artist, musician or actor, includes any income derived by him in exercise of his profession from the Government of a foreign State or any person not resident in India (hereinafter referred to as "foreign sources") and such income is received in, or brought into India, by him or on his behalf in accordance with Foreign Exchange Regulation Act, 1947, a deduction is allowed of an amount equal to twenty-five percent of such income so received or brought , in the computation of his total income, vide section 80RR of the Income-tax Act, 1961. 2. Recently, the Board had occasion to examine journalists who write stories or report news for foreign newspapers, magazines or radio-television networks and derive income from foreign sources would be entitled to the deduction provided in Section 80RR. The Board have been advised that such journalists can be regarded as authors for the purposes of section 80RR. It has, therefore, been decided that journalists who are occasional free-lanced writers and who are not "employees" and who are paid from foreign source wholly on the basis of the stories used will qualify for the said tax concession if the other conditions of section 80RR are satisfied. Journalists who are employees of overseas principals for whom they write will, however, not be eligible for the concession as this tax concession is available only to income derived by such individuals in the exercise of their profession. Some journalists may be paid a monthly retainer plus a separate payment for the stories used. The question whether they are employees or whether they derive such income in the exercise of their profession will have to be determined with reference to all the relevant facts of such case including the terms of employment and the manner of receipt of the payments made to them for their work.