This explanation provides an artificial place of accrual for income taxable under th head ‘Salaries’. According to it the incomes chargeable to tax as salaries shall be deemed to accrue or arise in India if they are earned in India. The place of receipt and actual accrual of the salary is immaterial. Any income payable for
(a) service rendered in India, and
(b) the rest period or leave period which is preceded and succeeded by services rendered in India and forms part of the service contract of employment,
shall be regarded as income earned in India.