Rule 72: Form 38 foreign-source royalty certificate
Rule 72 identifies the authority and certificate form for the foreign-source income documentation under sections 151(6) and 152(6). It is distinct from the author-payment and patent certificates prescribed in Rules 70 and 71.
Official notified Income-tax Rules, 2026Need advice on Rule 72?
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Rule 72 - The prescribed authority and form of certificate to be furnished under sections 151(6) and section 152(6)
For the purposes of sections 151(6) and 152(6),– (a) the prescribed authority shall be the Reserve Bank of India or another authorised authority under current laws regulating foreign exchange transactions; and (b) the certificate shall be furnished in Form No. 38.
Rule breakdown
Identify the relevant foreign-source deduction claim
The rule applies to the certificate requirements in sections 151(6) and 152(6). Determine which parent deduction and foreign-source income are involved.
Keep the underlying rights or patent agreement, foreign receipts and relevant claim records together.
Use the authorised foreign-exchange authority
The prescribed authority is the Reserve Bank of India or another authority authorised under the current laws regulating foreign-exchange transactions.
Verify the particular authority’s authorisation for the certificate rather than treating every intermediary handling a remittance as the prescribed authority.
Obtain the certificate in Form 38
The prescribed form is Form No. 38. Reconcile its particulars with the foreign-source income and supporting remittance evidence used for the claim.
The parent sections contain the requirement to furnish the certificate along with the return. Check their current conditions and the official submission procedure.
Keep it distinct from Forms 36 and 37
Rule 70 deals with the payer-verified author certificate in Form 36, and Rule 71 with the prescribed patent authority’s Form 37. Form 38 serves the separate foreign-source requirement.
Review the full document set applicable to the claim; one certificate should not be assumed to replace another required under a different subsection.
Key takeaways
Form 38
The prescribed foreign-source certificate.
Authorised authority
RBI or another properly authorised foreign-exchange authority.
Separate documentation role
Do not confuse it with Forms 36 or 37.
Practical checklist
- Identify the applicable parent subsection and income.
- Verify the issuing authority’s authorisation.
- Reconcile the certificate with foreign-income and remittance records.
Avoid
- Do not assume any remittance intermediary is authorised to issue it.
- Do not merge distinct certificate requirements without checking the Act.
FAQs
Which form does Rule 72 prescribe?
Form No. 38.
Is RBI the only possible authority?
The rule also permits another authority authorised under the current laws regulating foreign-exchange transactions.
Does Form 36 or 37 automatically replace Form 38?
No. They serve separate statutory certificate requirements; check which apply to the claim.
Glossary
- Form 38
- The certificate prescribed by Rule 72 for sections 151(6) and 152(6).
- Prescribed authority
- RBI or another authority authorised under the relevant foreign-exchange laws.