“Sikkimese” Is Only For The Purposes Of The Income-Tax Act, 1961, And Not For Any Other Purpose: CBDT Clarifies

The Central Board of Direct Taxes (CBDT) has clarified that the “Sikkimese” are defined only for the purposes of the Income-tax Act, 1961, and not for any other purpose.

The amendment to section 10(26AAA) of the Income-tax Act, 1961 by the Finance Act, 2023 while following the decision of the Supreme Court in the case of Association of Old Settlers of Sikkim vs Union of India. The Apex court held that the exclusion of old Indian settlers, who have permanently settled in Sikkim prior to the merger of Sikkim with India on 26.04.1975 from the definition of “Sikkimese” in Section 10(26AAA) of the Income Tax Act is unconstitutional.

"Sikkimese" shall mean an individual, whose name is recorded in the register maintained under the Sikkim Subjects Regulation, 1961 read with the Sikkim Subject 2 Rules, 1961 immediately before the 26th day of April 1975. An individual, whose name is included in the Register of Sikkim Subjects by virtue of the Government of India Order dated the 7th of August, 1990 and Order of even number dated the 8th of April, 1991. Any other individual, whose name does not appear in the Register of Sikkim Subjects, but it is established beyond doubt that the name of such individual's father or husband or paternal grandfather or brother from the same father has been recorded in that register.

Dated: 04.04.2023

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