(i) Reserve Bank, by its Notification Nos. F.E.R.A.195/99-RB dated 30th March 1999 and No. F.E.R.A. 212/99-RB dated 18th October 1999, has granted general permission under Section 19(1)(d) and 19( 1)(a) read with Section 9 (1) (a) of the Foreign Exchange Regulation Act, 1973 to domestic mutual funds referred to in clause (23D) of Section 10 of the Income Tax Act, 1961:-

a. to issue units or any other similar instrument,on repatriation basis, to NRIs/OCBs/PIOs/FIIs under the schemes floated by them with the approval of the Securities and Exchange Board of India, subject to the conditions mentioned under (ii), below.

b. to send such units/instruments out of India to the place of residence or location, as the case may be, of the non-resident investor, or to their global custodians in the case of FIIs.

c. to repurchase units or similar instruments issued to NRIs/OCBs/PIOs/FIIs and to make payment therefor to them;

(ii) the general permission to issue units referred to in (i)(a) is subject to the following conditions:-

a. The mutual fund should comply with the terms and conditions stipulated by the Securities and Exchange Board of India.

b. The amount representing investment should be received by inward remittance through normal banking channels or by debit to the NRE/ FCNR account of the non-resident investor or Special Non-Resident Rupee account of the FII maintained with an authorised dealer/ designated bank in India.

(iii) The net amount representing the dividend/interest and maturity proceeds may be remitted through normal banking channel or credited to NRE/FCNR/NRO/NRSR account of the non-resident investor or Special Non-Resident Rupee Account of the FII.

(iv) Authorised dealers may allow the credit of net amount of dividend/interest or the maturity proceeds/ repurchase value to the NRE/FCNR account of the non-resident investor or Special Non-resident Rupee account of the FII or allow remittance thereof only on production of a certificate from the mutual fund that the investment was made out of inward remittance from abroad or from the funds held in NRE/FCNR account of the non-resident investor maintained with an authorised dealer or Special Non-Resident Rupee Account of the FII with a designated bank in India and subject to compliance with the provisions of paragraph 3B.10.