Section 163:
Who may be regarded as agent.
(1) For the purposes of this Act, “agent”, in relation to a
non-resident, includes any person in India—
(a) who is employed by or on behalf of the non-resident; or
(b) who has any business connection with the non-resident; or
(c) from or through whom the non-resident is in receipt of any income, whether directly or
indirectly; or
(d) who is the trustee of the non-resident;
and includes also any other person who, whether a resident or non-resident, has acquired by means of a
transfer, a capital asset in India:
Provided that a broker in India who, in respect of any transactions, does not deal directly with or on
behalf of a non-resident principal but deals with or through a non-resident broker shall not be deemed to
be an agent under this section in respect of such transactions, if the following conditions are fulfilled,
namely:—
(i) the transactions are carried on in the ordinary course of business through the first-mentioned
broker; and
(ii) the non-resident broker is carrying on such transactions in the ordinary course of his business
and not as a principal.
2
Explanation.—For the purposes of this sub-section, the expression “business connection” shall have
the meaning assigned to it in Explanation 2 to clause (i) of sub-section (1) of section 9 of this Act.
(2) No person shall be treated as the agent of a non-resident unless he has had an opportunity of being
heard by the 1
Assessing Officer as to his liability to be treated as such.
Notes:
1. Subs. by Act 4 of 1988, s. 2, for “Income-tax Officer” (w.e.f. 1-4-1988).
2. Ins. by Act 32 of 2003, s. 68 (w.e.f. 1-4-2004).