New Delhi, May 19 -- -Name withheld on request.

I am assuming that you qualify as a non-resident ('NR') in India, as per the relevant income tax provisions, and also that you do not qualify as a deemed resident of India under the relevant income tax provisions.

Units of mutual fund qualify as capital assets, and any gain or loss arising on account of transfer of such mutual fund units qualifies as a capital gain or loss for tax purposes. As the situs of these capital assets is in India, any such capital gains will be considered as having accrued or arisen in India and are hence taxable in the country under the domestic tax laws, even if you qualify as an NR in India.

However, you may wish to examine and apply the provisions of Article ...