Exemption in respect of income received by certain foreign companies in India in Indian currency from sale of crude oil to any person in India [Section 10(48)] :
(i) A mechanism has been devised, in the national interest, to make payment to certain foreign companies in India in Indian currency for import of crude oil.
(ii) In order to provide exemption in respect of such income in the hands of the foreign company, especially since the payment is made in the interest of the nation, section 10(48) exempts any income of a foreign company received in India in Indian currency on account of sale of crude oil, any other goods or rendering of services, as may be notified by the Central Government in this behalf, to any person, in India. The National Iranian Oil Company has been notified by the Central Government in this behalf.
(iii) The following conditions have to be fulfilled for claim of such exemption –
(1) The money has been received under an agreement or arrangement which is either entered into, or approved by, the Central Government;
(2) The foreign company, as well as the arrangement or agreement, are notified by the Central Government having regard to the national interest;
(3) The foreign company is not engaged in any other activity in India, except receipt of income under such arrangement or agreement.