The incidence of tax on any assessee depends upon his residential status under the Act.
For all purposes of income-tax, taxpayers are classified into three broad categories on the basis of their residential status viz.
(1) Resident and ordinarily resident
(2) Resident but not ordinarily resident
The residential status of an assessee must be ascertained with reference to each previous year. A person who is resident and ordinarily resident in one year may become non-resident or resident but not ordinarily resident in another year or vice versa.
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