# Residential Status of HUF, Firm, AOP, BOI, Local Authority & Artificial Juridical Person

## HUF

```

HUF

│

┌────────────┴─────────────┐

Control & Management Control & Management

wholly or partly in India wholly outside India

│ │

Resident Non-Resident

│

┌───────┴────────┐

Karta satisfies BOTH Karta does NOT satisfy

additional conditions both additional conditions

of an individual (any one fails)

│ │

ROR RNOR

```

Step 1 (Resident or Not): Look at where Control and Management of HUF affairs is situated.
Wholly or partly in India → Resident.
Wholly outside India → Non-Resident.
Step 2 (ROR vs RNOR for Resident HUF): Apply the two additional conditions of an individual to the Karta:

1. Karta was Resident in ≥ 2 of 10 preceding PYs, AND

2. Karta stayed in India ≥ 730 days during 7 preceding PYs.

Both satisfied → ROR; otherwise → RNOR.

## Firm / LLP / AOP / BOI / Local Authority / Artificial Juridical Person

Only two classifications — Resident or Non-Resident. No ROR/RNOR distinction.

Control & Management of affairs	Status
Wholly OR partly in India	Resident
Wholly outside India	Non-Resident

## Key Idea

'Wholly or partly in India' is enough to make these entities Resident.
This is the opposite test for HUF compared to Companies (which use POEM — see separate lesson).
For these entities, individual partners'/members' residential status is irrelevant.

Worked example

### Example 1

HUF Example

ABC HUF has its Karta managing affairs partly from Delhi and partly from London during PY 24-25.

Control partly in India → Resident HUF.
Karta was Resident in 6 of last 10 PYs AND stayed 900 days in last 7 PYs → both additional conditions satisfied → ROR HUF.

If Karta's stay in last 7 PYs was only 500 days, additional condition 2 fails → RNOR HUF.

### Example 2

Firm Example

XYZ LLP has its head office in Singapore. All decisions are taken in Singapore. One partner occasionally visits India. → Control & Management wholly outside India → Non-Resident Firm.

If occasionally any management decision is taken in India (even partly) → Resident Firm.

### Example 3

AJP Example

A deity (idol) whose temple trust takes decisions partly in India and partly abroad → Resident.

⚠️ Common exam mistakes

Applying ROR/RNOR classification to Firm, LLP, AOP, BOI, Local Authority, or AJP — they have only two categories.
For HUF, applying the additional conditions to all coparceners instead of only the Karta.
Confusing 'Control and Management' with 'Place of Effective Management (POEM)' — POEM applies only to companies.
Treating a firm as Non-Resident merely because most partners are abroad — what matters is where control & management is exercised, not where partners reside.
Treating HUF as Non-Resident when only partial control is in India — even partial control in India makes HUF Resident.

Reference: Section 6(2), 6(4) — Income Tax Act, 1961

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Residential Status of HUF, Firm, AOP, BOI, Local Authority, AJP

Worked example

⚠️ Common exam mistakes