(i) In terms of Notification No.FERA.91/91-RB dated 13th September 1991 issued under Section 9(1) of FERA 1973, Reserve Bank has granted general permission to persons resident in India to meet expenses in Indian rupees on account of boarding, lodging and services related thereto and/or for travel within India, of their non-resident guests visiting India in connection with business, activity or any other work of the host. The Notification also permits residents to receive such payments from other residents on behalf of persons resident outside India, but on a visit to India. It will, therefore, be in order for Indian firms/companies and other organisations to meet expenses on local hospitality on behalf of their non-resident guests coming to India for the purpose stated above without obtaining specific permission of Reserve Bank.

NOTE: Indian firms/companies are sometimes required to pay for cost of to and fro passage fare of their non-resident directors, foreign technicians etc. coming to India for official business. There are no restrictions on payment of passage fares in India by residents on behalf of non-residents for travel to/from India on any Airline/Shipping company operating in/through India (see paragraph A.3 of Annexure III to Chapter 8).

(ii)In cases where expenses for travel to India and back as also expenses for internal travel, lodging, boarding etc., have been incurred by the non-resident company/person, authorised dealers may allow remittances towards reimbursement of such expenses to the non-resident company/person on verification of appropriate documentary evidence in support of the amount sought to be remitted and provided such expenses were required to be met by the Indian company in terms of the provisions of the relative contract agreement.