heIts really cruel taxation system that the salary or remuneration of crew members of a foreign ship are tax free even if ship is in India ,when their counterpart working for Indian ship do not get the tax free salary . To make issue clear , let me give you a hypothetical example .
[infobox style=”alert-success”]Say two Indians , one Mr X & Mr Y on 01/04/2013 joins two ships-Mr X joins an Indian ship and Mr Y joins a USA registered ship. Say , both ships( hypothetically) remained docked at Cochin port for 182 days during FY 2013-14. The Result ! The salary of Mr X working on Indian ship will be taxable , whereas of Mr Y working on foreign ship will be tax free.[/infobox]
If you are wondering why , please read carefully all the points below to understand the fundamental reasons for such a clear anomaly in tax treatment .