APPENDIX III
NOTIFICATIONS ORDERS ISSUED BY RESERVE BANK OF INDIA RELATING TO EXCHANGE CONTROL
SECTION 8
Notification No. FERA 47/77-R.B. dated 24-11-1977 amended up to 20th June 1997
Acquisition of Foreign Exchange
In pursuance of sub-section (1) of Section 8 and sub-section (3) of Section 73 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of the
Notification No. F.E.R.A.256/72-R.B. dated 7th October 1972, the Reserve Bank is pleased -
(a) to permit any person to acquire foreign exchange by way of scholarship or stipend from a charitable trust or educational institution or foundation or from a foreign government to enable him either to undergo a course of studies or training or both;
(b) to permit any person to acquire foreign exchange by way of income on assets held outside India or by way of inheritance, settlement or gift;
(c) to permit any person to acquire from any person not in India, foreign exchange by way of remuneration for services rendered whether in or outside India, or in settlement of any lawful obligation;
(d) to permit any person resident in India while on visit to any place out of India to receive foreign exchange by way of gift or honorarium or payment for services not arising from any business in or anything done in India.
Provided that a person who acquires foreign exchange as in clause (b) or in clause (c) shall, if he is an Indian citizen and receives foreign exchange in India, within seven days from its receipt, and, in any other case, within three months from its receipt, offer it or cause it to be offered for sale to the person, and in the manner laid down in the Central Governments
Notification No. G.S.R. 679E (F.10/22/90-NRI Cell) dated 17th July 1992; Provided further that in the case of a person resident outside India, the obligation to offer or cause to be offered for sale to an authorised dealer foreign exchange earned by such person by way of remuneration for services rendered outside India, shall not arise until such person ceases to be resident outside India and shall extend only to the amount of such foreign exchange owned by him when he ceases to be resident outside India;
Provided also that when any such foreign exchange is brought or sent into India, the person bringing in or, as the case may be, receiving it, shall, before the expiry of seven days from the date on which it is brought or, as the case may be, received, offer it for sale or cause the same to be offered for sale to any authorised dealer, and in the manner, laid down in the Central Governments Notification No. G.S.R.679E (F.10/22/90-NRI Cell) dated 17th July 1992.
Notification No. F.E.R.A.98/91-RB dated 18th November 1991 as amended up to 26th April 1993
Permission for Opening Foreign Currency Accounts/Site Offices
Abroad, Payment of Commission, etc. by Project Exporters
In pursuance of the powers conferred by sub-section (1) of Section 8 read with
Notification No. G.S.R.679E (F.10/22/90-NRI Cell) dated 17th July 1992, issued by the Government of India in the Ministry of Finance under Section 14, sub-section (1) of Section 9, sub-section (1) of Section 16 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and all other powers vested in it under the said Act, the Reserve Bank is pleased to permit exporters who have obtained post-bid letters of approval from the Exim Bank on behalf of the Working Group on Project Exports, or the Exim Bank or an Authorised Dealer within their delegated powers, in respect of export of engineering goods on deferred payment terms, execution of turn-key projects/civil construction contracts abroad or for the export of consultancy, technical or other services abroad -
(i) to open and maintain such number of foreign currency bank accounts and at such places outside India for the purpose of receiving payments due under and meeting expenditure connected with the export contract, as approved in the letter of approval;
(ii) to establish temporary site office at such place or places outside India, for the purpose of co-ordinating the work or services in the execution of the export contract, as approved in the letter of approval;
(iii) to pay such commission due to any agent outside India, in connection with the export contract, as approved in the letter of approval;
(iv) to raise such foreign currency loan or overdrafts abroad against guarantees of their bankers in India, for the purpose of bridging temporary shortfall in cash flows in the execution of export contract, as approved in the letter of approval;
subject to the conditions that:
(a) the terms and conditions specified in the letter of approval and any directions that may be given from time to time by the Reserve Bank are strictly complied with by the exporter;
(b) Within 15 days of the opening of such foreign currency bank accounts, temporary site office, payment of agency commission or availing of foreign currency loan/overdraft, the exporter submits to the concerned Regional Office of the Reserve Bank, a statement containing full particulars of such bank accounts, site office, commission or loan / overdraft;
(c) a quarterly statement in the form specified for the purpose, along with documents specified in such form, is submitted by the exporter to the concerned Regional Office of the Reserve Bank.
Notification No. F.E.R.A.116/92-RB dated 7th September 1992
as amended up to 28th April 1995
Permission for Maintaining Accounts in
Foreign Currencies in India/Abroad by
Residents in Certain Cases
In pursuance of sub-section (1) of Section 8 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of its
Notifications No. F.E.R.A.3/74-RB dated 1st January 1974 and No. F.E.R.A.108/92-RB dated 15th February 1992, the Reserve Bank is pleased to direct that the prohibition imposed by that sub-section shall not apply to (1) the maintenance of and operations on an account, expressed in any foreign currency, with an authorised dealer in India in accordance with any schemes approved by the Reserve Bank in this behalf, or outside India, if such foreign currency was acquired by a person
(a) otherwise than in contravention of the said Act, while he was resident outside India;
or
(b) through employment, business or vocation outside India, taken up or commenced while such person was resident outside India;
Provided that in either case, such a person has been resident outside India for a continuous period of not less than one year.
2) the maintenance of and operations on an account in any foreign currency with a bank situated outside India by a person resident in India.
Provided that such account was opened,
(a) prior to 8th July 1947 and maintained with the permission of the Reserve Bank, or
(b) with the foreign currency acquired by a person resident in India, by way of gift or inheritance, from a person maintaining an account in any foreign currency under clause (1) or sub-clause (a) hereinabove, as the case may be,
Provided that in case of gift, the person receiving the gift of foreign currency is a relative of the person making such gift and any tax in respect of gift has been paid in India.
Explanation: For the purpose of this clause "relative" in relation to an individual, means husband, wife, brother or sister or any lineal ascendant or descendant of that individual.
Notification No. F.E.R.A.125/93-RB dated 15th January 1993
Bids in Foreign Currency for Projects in India
In pursuance of sub-section (1) of Section 8 read with sub-section (3) of Section 73 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank is pleased to permit any person resident in India,
(i) to incur liability;
(ii) to purchase from authorised dealer sums of money;
(iii) to make payments; and
(iv) to receive payments
in foreign exchange, in respect of the global bids where the Central Government has authorised bidding procedures enabling Indian as well as foreign companies/entities to bid for the supply of goods and services for projects to be executed in India and in cases of bids submitted by persons resident in India, they have been accepted by the Indian agency, authorised by the Government, inviting bids.
Notification No. F.E.R.A. 127/93-RB dated 22nd March 1993
Payment against International Credit Cards
In pursuance of sub-section (1) of Section 8, sub-section (1) of Section 9 and sub- section (3) of Section 73 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank is pleased to permit any person, who has entered into an agreement with one or more credit card servicing bank/organisation in India, to receive payment in Indian rupees for goods and/or services sold in India against charge slips raised on internationally recognised credit cards of persons resident outside India:
Provided that the dues are realised in foreign exchange through an authorised dealer from the Credit Card issuing institution/s overseas in an approved manner.
Explanation: For the purpose of this notification "internationally recognised credit card" will also include "add-on"/"supplementary"/"sponsored" credit card issued overseas in favour of a person resident in or outside India.
Notification No. F.E.R.A.134/93-RB dated 26th April 1993
Permission for Opening and Operation of Accounts Abroad
In pursuance of sub-section (1) of Section 8 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of its Notification No. F.E.R.A.4/74-RB dated 1st January 1974, the Reserve Bank is pleased to permit a person resident in India but who is out of India, to open with a bank outside India, an account in foreign currency and operate thereon during his stay out of India:
Provided that the deposit in such account is made out of -
(i) foreign exchange obtained from an authorised dealer or money changer, in India;
or
(ii) foreign exchange received outside India by way of scholarship or stipend or by way of salary or payment for services not arising from any business in, or anything done while in India.
Notification No. F.E.R.A.158/94-R.B. dated 24th February 1994
as amended up to 22nd July 1997
Acquisition of Foreign Exchange by Residents
In pursuance of sub-section (1) of Section 8 and sub-section (3) of Section 73 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of its
Notification No.F.E.R.A.62/83-RB dated 13th September 1983, the Reserve Bank is pleased to permit any person to receive payment in any foreign currency/currencies from any person resident outside India and who is on a visit to India for services rendered or in settlement of any lawful obligation:
Provided that any such foreign currency/currencies acquired in excess of two thousand U.S. dollars or its equivalent inclusive of the currency or currencies held or acquired for numismatic purposes or its equivalent is sold or caused to be sold within seven days from its receipt to an authorised dealer in the manner laid down in Central Governments
Notification No.GSR-679(E)(F.10/22/90-NRI Cell) dated 17th July 1992. Notification No.F.E.R.A.161/95-RB dated 31st January 1995
Foreign Currency Accounts by Persons Participating
in Exhibition/Trade Fair Abroad
In pursuance of sub section (1) of Section 8 read with Section 18 and sub section (3) of Section 73 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank of India hereby permits a person resident in India but who is out of India for participation in exhibition/trade fair to open with a bank outside India an account in foreign currency and operate for depositing the foreign exchange obtained by sale of jewellery and other goods exported for display-cum-sale in the international exhibition/trade fair provided that the account is closed immediately after close of exhibition/trade fair and the amount is repatriated in foreign exchange at the time of closure of the exhibition/fair and the exporter furnishes to Reserve Bank the full account of transactions and sale of goods exported for display-cum-sale in exhibition/trade fair duly certified by his banker and evidence of reimport of balance jewellery/goods within a period of 15 days.
Notification No. F.E.R.A.172/97-RB dated 24th February 1997
Surrender of Unspent Foreign Exchange by Residents
In pursuance of sub-section (1) of Section 8 read with sub-section (3) of Section 73 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of
Notification No. F.E.R.A.73/88-RB dated 27th February 1988, the Reserve Bank is pleased to permit any person resident in India to acquire foreign exchange for travel abroad in accordance with the conditions specified from time to time, and retain the unspent foreign exchange brought back by him to India subject to the condition that such unspent foreign exchange shall be utilised again for travel abroad, within:
(a) a period not exceeding 90 days from the date of his return, if such unspent foreign exchange is in the form of notes and coins; and
(b) a period not exceeding 180 days from the date of his return, if such unspent foreign exchange is in the form of travellers cheques.
Notification No. F.E.R.A.183/98-RB dated 22nd April 1998
Permission for Opening/Maintaining Foreign Currency
Accounts in India by Recipients of Foreign Exchange In pursuance of Sub-Section (1) of Section 8 read with Sub-Section (3) of Section 73 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of its Notification No.F.E.R.A.159/94-RB dated 1st March 1994, the Reserve Bank is pleased to permit every person resident in India to open and operate in India an account expressed in foreign currency with an authorised dealer and to credit to such account.
(i) up to 70% of any remittance received from outside India in convertible foreign currency by a 100 per cent Export Oriented Unit or a unit located in Export Processing Zone or in Software Technology Park or in Electronic Hardware Technology Park;
(ii) up to 50% of any remittance received by any person from outside India in convertible foreign currency;
(iii) up to 50% of any other payment (including payment in rupees) received in India by any person, as may be specifically permitted by the Reserve Bank through an A.D. Circular.
Provided that such remittances or payments are other than those received pursuant to an undertaking or for meeting any specific obligation.
Provided further that withdrawals from such account, other than for remittances outside India or for payment in India in foreign currency, for such purposes as may be advised through an A.D. Circular, are allowed by the authorised dealer only in Indian rupees at market rate prevailing on the date of such withdrawal.
SECTION 9
Notification No. F.E.R.A.6/74-RB dated 1st January 1974
Making Payments in Rupees on Behalf of Non-residents
G.S.R.88 In pursuance of clause (d) of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank is pleased to permit the making of any payment in rupees by order or on behalf of a person resident outside India out of rupee funds provided by sale of foreign exchange, by such person, to an authorised dealer in India
Notification No. F.E.R.A.7/74-RB dated 1st January 1974
Transactions in Indian rupees with residents of Nepal and Bhutan
G.S.R.89 In pursuance of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank hereby directs that none of the prohibitions imposed by the various clauses of that sub-section shall apply to any transaction entered into in Indian rupees by or with -
(i) Indians, Nepalese or Bhutanese resident in Nepal or Bhutan,
(ii) a branch situated in Nepal or Bhutan of any business carried on by a company or a corporation incorporated or established under any law in force in India, Nepal or Bhutan,
(iii) a branch situated in Nepal or Bhutan of any business carried on as a partnership firm or otherwise by Indians, Nepalese or Bhutanese.
Notification No. F.E.R.A.48/77-RB dated 24th November
1977 as amended up to 26th April 1993
Receipt of Payment by Order or on behalf of Non-residents
In pursuance of clause (b) of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of the
Notification No. F.E.R.A.257/72-RB dated 7th October 1972, the Reserve Bank is pleased to permit any person to receive any payment by order or on behalf of a person resident outside India -
(a) made in rupees during such persons stay in India, out of the rupee funds provided by sale by such person, of foreign exchange to an authorised dealer in India;
(aa) made in rupees representing income from immovable property held in India by a non-resident provided that the rupees are credited within two months from the date of receipt of such income to the account of the non-resident with an authorised dealer in foreign exchange in India and provided that such properties are held in accordance with Section 31 of the said Act, where applicable;
(b) by means of postal order issued by a post office outside India or by a postal money order issued by such post office;
(c) by means of cheques drawn on banks situated outside India or bank drafts or travellers cheques issued outside India;
(d) in foreign currency notes received by him directly from out of India;
subject to the condition that any foreign exchange received shall, within seven days of receipt of the same be offered for sale or cause to be offered for sale in accordance with the Central Governments Notification No. G.S.R.679E (F.10/22/90-NRI Cell) dated 17th July 1992.
Notification No. F.E.R.A.82/89-RB dated 9th August 1989
Sending or bringing into India Foreign Exchange
Otherwise than through an Authorised Dealer
In pursuance of sub-section (3) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of the
Notification of Reserve Bank of India No. F.E.R.A.8/74-RB dated 1st January, 1974 the Reserve Bank hereby directs that the provisions of the said sub-section shall not be deemed to apply to the sending or, as the case may be, bringing into India, in accordance with the
Notification of Reserve Bank of India No. F.E.R.A.81/89-RB dated 9th August 1989, of -
i) foreign exchange (other than currency notes, bank notes and travellers cheques),
or
ii) currency notes or bank notes expressed in Indian rupees referred to in the said notification.
Notification No. F.E.R.A.85/89-RB dated 9th October
1989 as amended up to 3rd July 1999
Issue of Commercial Paper
In pursuance of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank hereby directs that the prohibition imposed by clause (c) of that sub-section, shall not apply to the issue of commercial paper to non-residents of Indian nationality or origin (NRIs) and to Overseas Corporate Bodies (OCBs) by a company which issues commercial paper in accordance with the terms and conditions stipulated by the Reserve Bank in that regard:
Provided that the amount invested in such commercial paper and the income earned thereon shall not be allowed to be repatriated out of India; and that commercial paper issued to NRIs or OCBs shall not be transferable.
Explanation: A person (not being a citizen of Pakistan or Bangladesh) shall be deemed to be of Indian origin, if he, at any time, held Indian passport; or he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955); or that person is the spouse of an Indian citizen or of a person of Indian origin (not being a citizen of Pakistan or Bangladesh).
Notification No. F.E.R.A.91/91-RB dated 13th September 1991
Expenditure on Hospitality to Non-resident Visitors
In pursuance of the powers conferred by clauses (b) and (d) of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of
Notifications Nos. FERA.78/89-RB dated 12th May 1989, FERA.83/89-RB dated 14th September 1989 and FERA.86/90-RB dated 5th May 1990, the Reserve Bank is pleased -
(a) to permit any person resident in India (hereinafter referred to as the host) to make payment to another resident, in Indian rupees towards meeting expenses on account of boarding, lodging and services related thereto and/or travel within India, of a person resident outside India and who is on a visit to India in connection with business, activity or any other work of the host;
(b) to permit any person resident in India to receive from another person resident in India any payment, such payment being made and received towards meeting expenses on account of boarding, lodging and services related thereto and/or travel within India, of a person resident outside, but on a visit to India.
Notification No. F.E.R.A.92/91-RB dated 13th September
1991 as amended up to 26th April 1993
Payment of Technical Know-how Fee/Royalty
In pursuance of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank of India hereby directs that the prohibition imposed by clause (a) of that sub-section shall not apply to the making of any payment by a person in or resident in India towards technical know-how fee and/or royalty under a foreign technical collaboration arrangement, approved by the Government of India or the Reserve Bank as the case may be, subject to the conditions that -
(i) the payment is made strictly in accordance with the terms and conditions specified for the purpose in the letter of approval for the technical collaboration, issued by the Government of India or the Reserve Bank as the case may be;
(ii) the payment is effected through an authorised dealer designated for the purpose by the Reserve Bank in respect of the relative technical collaboration;
(iii) a statement in duplicate in the form specified for the purpose, shall be submitted to the Exchange Control Department of the concerned regional office of the Reserve Bank in the first fortnight of January each year, by the Indian party to the technical collaboration, in respect of all payments made under the collaboration arrangement during the year.
Notification No. F.E.R.A.117/92-RB dated 7th September 1992
as amended up to 28th April 1995
Payments out of Foreign Currency Accounts
held in India/Abroad by Residents
In pursuance of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of its
Notification No. F.E.R.A.5/74-RB dated 1st January 1974, the Reserve Bank is pleased to direct that the prohibition imposed by Clause (a) of that sub-section shall not apply to -
(1) the making of any payment to or for the credit of any person resident outside India, out of foreign exchange held in India in accordance with any schemes approved by the Reserve Bank in this behalf, or outside India, if such foreign exchange was acquired by a person -
(a) otherwise than in contravention of the said Act, while he was resident outside India;
or
(b) through employment, business or vocation outside India, taken up or commenced while such person was resident outside India.
Provided that in either case, such a person has been resident outside India for a continuous period of not less than one year.
(2) the making of any payment to or for the credit of any person resident outside India, out of an account in any foreign currency, with a bank situated outside India, by a person resident in India,
Provided that such account was opened,
(a) prior to 8th July 1947 and maintained with the permission of the Reserve Bank, or
(b) with the foreign currency acquired by a person resident in India, by way of gift or inheritance, from a person maintaining an account in any foreign currency under clause (1) or sub-clause (a) hereinabove, as the case may be,
Provided further that in case of gift, the person receiving the gift of foreign currency is a relative of the person making such gift and any tax in respect of gift has been paid in India.
Explanation : For the purpose of this clause "relative" in relation to an individual, means husband, wife, brother or sister or any lineal ascendant or descendant of that individual.
Notification No. F.E.R.A.128/93-RB dated 29th March 1993
Payments to Non-resident Directors
In pursuance of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank of India hereby directs that the prohibition contained in clause (a) of that sub-section shall not apply to the making of payment in Indian rupees, by a company in or resident in India to its non-wholetime director who is resident outside India and is on a visit to India for the companys work such as attending Board meeting, etc. and is entitled to payment of sitting fees or commission or remuneration by way of monthly or quarterly or annual payment in accordance with the provisions therefor contained in the companys Memorandum of Association or Articles of Association or in any agreement entered into by it or in any resolution passed by the company in general meeting or by its Board of Directors.
Provided that, the Central Governments approval has been obtained by the company under Section 309(4) or Section 310 of the Companies Act, 1956, wherever it applies.
Notification No.F.E.R.A.167/95-RB dated 30th May 1995
Purchase of gold/silver imprted by NRIs, by resident Indians
In pursuance of clause (a) of sub-Section (1) of Section 9 of the Foreign Exchange Regulation Act 1973 (46 of 1973) the Reserve Bank is pleased to permit any person resident in India to make payment in Indian Rupees by means of a crossed cheque in India as consideration for purchase of gold/silver in any form including ornaments (but excluding ornaments studded with stones or pearls) to a person resident outside India who has imported and sold such gold/silver in accordance with the terms and conditions imposed under any order issued by the Central Government under the Foreign Trade (Development and Regulation) Act, 1992 or under any other law for the time being in force.
Notification No.F.E.R.A.196/99 RB dated 30th March 1999
In pursuance of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), Reserve Bank hereby permits -
(1) a proprietorship concern or a firm in India to accept rupee deposits on non-repatriation basis from Non-Residents of Indian nationality or origin (NRIs), and
(2) a company incorporated in India (including a non-banking finance company registered with Reserve Bank) to accept rupee deposits on repatriation or non-repatriation basis from Non-residents of Indian nationality or origin (NRIs) or Overseas Corporate Bodies (OCBs).
Provided that -
(A) In respect of deposits accepted on repatriation basis -
(a) company receives such deposits under a public deposit scheme;
(b) the amount representing the deposits is received by inward remittance through normal banking channels or by debit to the depositors NRE/FCNR accounts with an Authorised Dealer in India;
(c) the rate of interest payable on deposits shall not exceed the ceiling rate prescribed from time to time under the Companies (Acceptance of Deposits) Rules, 1975;
(d) the maturity period of deposits does not exceed three years;
(e) if the deposit accepting company is a non-banking financial company, it has a credit rating as prescribed by the guidelines issued by Reserve Bank for such companies;
(f) the amount of aggregate deposits does not exceed 35% of net owned funds of the company.
(B) In respect of deposits accepted on non-repatriation basis by proprietorship concern or a firm or a company -
(a) the maturity period of deposits does not exceed three years;
(b) the rate of interest payable on deposits does not exceed the ceiling rate prescribed from time to time for payment of interest by a company under the Companies (Acceptance of Deposits) Rules, 1975;
(c) if the amount of deposits is received by inward remittance through normal banking channels or by debit to the non-resident depositors NRE/FCNR/NRO account with an authorised dealer in India, the payment of interest and repayment of deposit may be made by credit to the non-resident depositors NRO or NRSR account maintained with an authorised dealer in India. If the amount of deposit is received by debit to the non-resident depositors NRSR account, payment of interest and repayment of deposit shall be made by credit to NRSR account of the depositor.
(C) In respect of deposits accepted on repatriation and non-repatriation basis, the following additional conditions are fulfilled, namely -
(a) receipt of deposit is in accordance with the applicable law in India including the rules and regulations issued by Government of India or Reserve Bank or the SEBI or any other competent authority;
(b) the proprietory concern or firm or company accepting deposit does not utilise the funds representing the deposit for undertaking agricultural/plantation activities or real estate business or for lending or for investing in any other concern, firm or company engaged in or proposing to engage in agricultural/plantation activities, real estate business or for relending.
Explanation: For the purpose of this Notification -
I. A person (not being a citizen of Pakistan or Bangladesh or Sri Lanka) shall be deemed to be of "Indian Origin", if -
i) he, at any time, held Indian passport;
or
ii) he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955);
or
iii) that person is the spouse of an Indian citizen or of a person of Indian origin (not being a citizen of Pakistan or Bangladesh or Sri Lanka).
II. "Overseas Corporate Body" means any overseas company, partnership firm, society and other corporate body predominantly owned directly or indirectly to the extent of atleast sixty percent by NRIs and includes overseas trust in which not less than sixty percent beneficial interest is held by NRIs, directly/indirectly but irrevocably.
Notification No.F.E.R.A.200/99-RB dated 30th March 1999 in supersession of Notification No.F.E.R.A.175/97-RB dated 27 February 1997
In pursuance of sub-section (1) of Section 9 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of its
Notification No.FERA.175/97-RB dated 27th February 1997, the Reserve Bank hereby permits an individual resident in India or a proprietorship concern or a firm in India to receive rupee loans on non-repatriation basis from Non-residents of Indian nationality or origin (NRIs) -
Provided that - (a) the amount representing the loan is received through normal banking channels or by debit to the non-resident lenders NRE/FCNR/NRO/NRSR account with an authorised dealer in India;
(b) the maturity period of the loan does not exceed 3 years;
(c) rate of interest on loan does not exceed 2% over the Bank Rate prevailing on the date of granting the loan;
(d) the amount of loan shall not be allowed to be repatriated out of India;
(e) if the amount of loan is received by inward remittance through normal banking channels or by debit to the lenders NRE/FCNR/NRO accounts, the payment of interest and repayment of loan may be made by credit to the lenders NRO/NRSR account maintained with an authorised dealer in India. If the amount of loan is received by debit to the lenders NRSR account, payment of interest and repayment of loan shall be made by credit to NRSR account of the lender;
(f) the amount of loan is not utilised by the borrower for the purpose of carrying on agricultural/plantation activities, purchase of immovable property, shares, debentures, bonds or for relending.
Explanation: For the purpose of this Notification a person (not being a citizen of Pakistan or Bangladesh or Sri Lanka) shall be deemed to be of Indian Origin, if -
i) he, at any time, held Indian passport;
or
ii) he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955);
or
iii) that person is the spouse of an Indian citizen or of a person of Indian origin (not being a citizen of Pakistan or Bangladesh or Sri Lanka).
SECTION 13
Notification No. F.E.R.A.81/89-RB dated 9th August
1989 as amended up to 9th March 1999
Import of Foreign Exchange and Indian Currency
In pursuance of the Notification of the Government of India, the Ministry of Finance
No. F.1/107/EC/73 dated the 1st January 1974 and in supersession of the Notification of Reserve Bank of India
No. F.E.R.A.168/95-RB dated 5th June,1995, the Reserve Bank is pleased - to permit any person to send into India without limit foreign exchange in any form other than currency notes, bank notes and travellers cheques; to permit any person to bring into India from Nepal, currency notes of the Government of India and Reserve Bank of India notes (other than notes of the denominations of above Rs.100/-); to permit any person who is a resident of India and had gone out of India on a temporary visit, to bring into India at the time of his return from any place outside India (other than Nepal), currency/notes of the Government of India and Reserve Bank of India notes up to an amount not exceeding Rs.1000/- which he had taken out while leaving India for a temporary visit; to permit any person to bring into India from any plac
e outside India without limit foreign exchange (other than unissued notes);
Provided that the permission contained in Clause (iv) above to bring foreign exchange into India shall be available to any such person only if he makes, on arrival in India, a declaration to the Customs authorities in such form as may be specified by the Reserve Bank in this behalf, of the particulars of such foreign exchange brought in by him;
Provided further that it shall not be necessary to make such declaration where the aggregate value of the foreign exchange brought in by such person in the form of currency notes, bank notes or travellers cheques at any one time does not exceed U.S.$ 10,000 (U.S. dollars ten thousand) or its equivalent and/or the aggregate value of foreign currency notes brought in by such person at any one time does not exceed U.S.$ 5,000 (U.S. dollar five thousand) or its equivalent
Notification No.F.E.R.A.36/76-RB dated 10th May 1976 as amended up to 24th April 1999 vide Notification No.F.E.R.A.203/99-RB dated 24th April 1999
Export of Cheques, Drafts, Foreign Exchange, etc.
G.S.R.949 In pursuance of sub-section (2) of Section 13 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of the Notification of the Reserve Bank of India
No.F.E .R.A.25/47-RB dated 10th July 1947, as amended from time to time, the Reserve Bank is pleased - to permit the authorised dealers to send out of India foreign currency in the form of coins, currency notes, cheques, drafts or bills of exchange which have been acquired in the normal course of their business and within the terms of their authorisations; to permit any person maintaining an account in accordance with the provisions of the Notification of the Reserve Bank of India
No.F.E.R.A.116/92-RB dated 7th September 1992 or No.F.E.R.A.183/98-RB dated 22nd April, 1998 to take or send out of India, cheques or drafts drawn on such account.
Notification No. F.E.R.A.80/89-RB dated 9th August, 1989
as amended up to 27th September 1999
Export of Foreign Exchange and Indian Currency
In pursuance of sub-section (2) of Section 13 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of the Notification of the Reserve Bank of India No. F.E.R.A.10/74-RB dated 1st January, 1974 as amended from time to time, the Reserve Bank is pleased -
i) to permit any person resident in India to take outside India (other than to Nepal) currency notes of the Government of India and Reserve Bank of India notes up to an amount not exceeding Rs.1000/-per person at any one time,
ii) to permit any person to take or send out of India to Nepal, currency notes of Government of India and Reserve Bank of India notes (other than notes of the denominations of above Rs.100/- in either case) and Indian coins or other notes or coins which are the currency of Nepal,
iii) to permit currency in the safes of vessels or aircraft which has been brought into India or which has been taken on board a vessel or aircraft with the permission of the Reserve Bank to be taken out of India,
iv) to permit any person in India but not resident therein to take out of India an amount of foreign exchange not exceeding the amount brought in by him in foreign exchange;
provided that -
(a) he had made, on arrival in India, a declaration to the customs authorities, in such form as specified by the Reserve Bank in this behalf, of the amount of foreign exchange sought to be taken,
or
(b) the amount sought to be taken out in foreign exchange is less than the amount specified by the Reserve Bank from time to time, for which a declaration is required to be made to customs authorities.
v) to permit any person in, or resident in India, to take out of India foreign currency or currencies equivalent to two thousand U.S.dollars held by such person in terms of item (9) to the proviso to the Central Government Notification No.GSR 679(E) [F/10/22/90-NRI Cell] dated 17th July 1992.
vi) to permit any person resident in India to take out of India, unspent foreign exchange brought back by him to India while returning from his previous visit abroad and retained in accordance with the Reserve Banks Notification No. F.E.R.A.172/97-RB dated February 24, 1997
(a) in the form of notes and coins, within a period not exceeding 90 days from the date of his return:
(b) in the form of travellers cheques within a period not exceeding 180 days from the date of his return.
Notification No. F.E.R.A.156/93-RB dated 4th November 1993
Export of Commemorative Coins
In pursuance of sub-section (2) of Section 13 of the Foreign Exchange Regulation Act, 1973 (No.46 of 1973), the Reserve Bank is pleased to permit any person to take or send out of India, currency in the form of Commemorative Coins not exceeding two coins each of Rs.50 and Rs.10 denomination.
Explanation: "Commemorative Coin" includes coin issued by Government of India Mint to commemorate any specific occasion or event and expressed in Indian rupees.
SECTION 18
(ISSUED BY RBI)
Order No. EC.CO.COX.126/5 Policy/93 dated 5th March 1993
Despatch of Air crafts, Engines and
Spare parts for Overhauling/Repairs In pursuance of Clause (f) of the
Notification No. F.1/67/EC/73-1 dated 1st January,1974 issued by the Central Government in exercise of the powers conferred under sub-section (1) of Section 18 of Foreign Exchange Regulations Act, 1973 (46 of 1973 as amended), the Reserve Bank, having been satisfied that the despatch of air-crafts, engines and spare parts, out of India for overhauling and repairs and their subsequent return into India does not involve any transaction in foreign exchange, hereby permits, without furnishing a declaration in the prescribed form, the despatch of air-crafts, engines and spare parts, out of India for overhauling and repairs.
Notification No.FERA.179/97-RB dated 18th October 1997
Export of Replacement Goods
The Central Government had in exercise of the powers conferred by Sub-Section (1) of Section 18 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) issued a
Notification No.F1/67/EC/73-1 dated 1st January 1974. In terms of clause (f) of the proviso to the said Notification, goods, the export of which in the opinion of the Reserve Bank of India did not involve any transaction in foreign exchange could be exported to any place outside India other than Nepal and Bhutan, without furnishing a declaration in the prescribed form if so permitted by the Reserve Bank of India by a general or special order, issued in this regard.
2. In terms of para 11.9 of the Export/Import Policy, goods or parts thereof on being exported and found defective/damaged or otherwise unfit for use may be replaced by the export of replacement goods free of charge by the exporter subject to the conditions specified therein. stipulated in the said Notification.
3. Now, therefore, in terms of clause (f) of the said Government of India Notification dated 1.1.1974, the Reserve Bank of India hereby grants a general permission to an exporter resident in India, to export replacement goods, strictly in accordance with the provisions of para 11.9 of the Exim Policy without furnishing to the prescribed authority a declaration in the prescribed form stipulated in the said Notification.
SECTION 19
Notification No. F.E.R.A.114/92-RB dated 27th
April 1992 as amended up to 24th February 1997
Permission for Issue of Shares/Convertible
Debentures to NRIs/OCBs on Non-repatriation Basis
In pursuance of sub-section (1) of Section 29 read with sub-section (1) of Section 19 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank hereby permits -
(a) Non-residents of Indian nationality or origin (NRIs) and overseas corporate bodies (OCBs) to take up or subscribe on non-repatriation basis, the shares or convertible debentures issued, whether by public issue or private placement, by a company incorporated in India;
(b) A company incorporated in India to issue shares, or convertible debentures by way of new/rights/ bonus issue to NRIs or OCBs;
(c) The taking or sending of shares or convertible debentures issued to such NRIs or OCBs out of India to their place of residence or incorporation as the case may be pursuant to the permission hereby granted except to South Africa.
Provided that -
(1) the investee company,
(i) does not carry on agricultural/plantation activities or real estate business (excluding real estate development i.e. development of property and construction of houses), or chit fund business,
(ii) is not a Nidhi company.
(2) The payment for the shares or convertible debentures issued to such NRIs or OCBs is received by remittances from abroad through normal banking channels or by transfer of funds held in investors NRE/FCNR/NRO account maintained with banks authorised to deal in foreign exchange in India or authorised co-operative/commercial banks in India,
(3) Neither the capital invested nor any income arising therefrom whether by way of capital appreciation or dividend or otherwise is eligible for repatriation out of India at any time,
(4) All dividend accruals and sale proceeds of shares (if sold in future) with permission of the Reserve bank (wherever necessary) will be credited to the investors ordinary non-resident rupee account with a bank authorised to deal in foreign exchange in India,
(5) The company issuing the shares or convertible debentures files a declaration not later than ninety days from the date of issue, giving full particulars with the Reserve Bank of India in such form as may be specified. Where shares or convertible debentures are issued to an OCB, a certificate in the form specified (OAC/OAC-1) issued by an overseas auditor, Chartered Accountant or Certified Public ccountant, showing the ownership of such OCB shall be filed with the Reserve Bank along with the declaration.
Explanation: I. A person (not being a citizen of Pakistan or Bangladesh), shall be deemed to be of Indian Origin, if -
(i) he, at any time, held Indian passport;
or
(ii) he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955);
or
(iii) that person is the spouse of an Indian citizen or of a person of Indian origin (not being a citizen of Pakistan or Bangladesh).
II. Overseas Corporate Body means any overseas company, partnership firm, society and other corporate body predominantly owned directly or indirectly to the extent of at least 60 per cent by NRIs and includes any overseas trust in which not less than sixty percent beneficial interest is held by NRIs, directly/indirectly but irrevocably.
Notification No. F.E.R.A.118/92-RB dated 7th September 1992
as amended up to 28th April 1995
Permission for retaining Foreign Securities
In pursuance of sub-section (1) of Section 19 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of its
Notification No. F.E.R.A.12/74 RB dated 1st January 1974, the Reserve Bank is pleased to direct that the prohibition imposed by that sub-section on the acquisition, holding or disposal of any foreign security, shall not apply to
(1) foreign securities acquired out of foreign exchange held in India in accordance with any schemes approved by the Reserve Bank in this behalf, or outside India and income thereon, if such foreign exchange was acquired by a person -
(a) otherwise than in contravention of the said Act, while he was resident outside India;
or
(b) through employment, business or vocation outside India, taken up or commenced while such person was resident outside India.
Provided that in either case, such a person has been resident outside India for a continuous period of not less than one year.
(2) foreign securities acquired on or before 8th July,1947 and continued to be held outside India, by a person resident in India, with the permission of the Reserve Bank;
(3) foreign securities referred to in clause (1) or clause (2) above where acquired by a person resident in India by way of gift or inheritance,
Provided that in case of gift, the person receiving the gift of foreign securities is a relative of the person making such gift and any tax in respect of the gift has been paid in India.
Explanation : For the purpose of this clause "relative" in relation to an individual, means husband, wife, brother or sister or any lineal ascendant or descendant of this individual.
Notification No. F.E.R.A.122/92-RB dated 17th September 1992
Permission to Record Overseas Address
Consequent on Change of Residence
In pursuance of Sub-Section (4) of Section 19 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), Reserve Bank of India is pleased to permit companies in India to enter in its register or books, in which securities are registered or inscribed, an address outside India of a holder of any securities, consequent on change of resident status of such holder, from resident to non-resident, subject to the condition that such company obtains an undertaking from the holder that he will not seek repatriation of any income, dividend, or sale proceeds of the securities.
Notification No. F.E.R.A.143/93-RB dated 26th April 1993
as amended up to 31st October 1995
Permission for Subscribing to the Memorandum
and Articles of Association of an Indian Company
In pursuance of clause (b) of sub-section (1) of Section 29 read with clause (d) of sub- section (1)of Section 19 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of its
Notification No. F.E.R.A.66/86-RB dated 28th November 1986, the Reserve Bank is pleased to permit a non-resident Indian citizen or a person of Indian origin to subscribe to the Memorandum of Association and Articles of Association and to acquire share of a company for the purpose of incorporation of such company in India and such company to issue share to a non-resident Indian citizen or a person of Indian origin subject to the conditions that, -
(i) the total face value of the shares to be taken up by the non-resident Indian citizen or person of Indian origin does not exceed Rs.10,000/- (Rupees ten thousand only);
(ii) such company is not engaged in any activity relating to agriculture or plantation;
(iii) the Memorandum of Association of such company does not permit the company to take up any agricultural/plantation activity and/or to deal in real estate business other than developing real estate, i.e. development of property and construction of houses;
and
(iv) such company files a declaration, regarding particulars of shares issued, with the Reserve Bank within ninety days from the date of its incorporation in such form as may be specified.
Explanation: A person (not being a citizen of Pakistan or Bangladesh), shall be deemed to be of Indian origin, if -
(i) he, at any time, held Indian passport;
or
(ii) he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955);
or
(iii) that person is the spouse of an Indian citizen or of a person of Indian origin (not being a citizen of Pakistan or Bangladesh).
Notification No. F.E.R.A.145/93-RB dated 26th April 1993
Permission to Convert Shareholdings into
Joint Holdings by/with NRIs/Resident Indians
In pursuance of sub-sections (1) and (5) of Section 19 read with clause (b) of sub-section (1) of Section 29 of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and in supersession of its
Notification No. F.E.R.A.123/92-RB dated 17th September 1992, the Reserve Bank is pleased to permit -
(1) a person of Indian nationality or origin resident outside India, who holds any securities issued or registered in India, to convert his holding into joint holding by addition of the name(s) of any person or persons of Indian nationality or origin resident in India, subject to the conditions that -
(a) transfer formalities as required under the Companies Act, 1956 are complied with;
and
(b) dividend, income or sale proceeds of the securities, accruing to a person resident in India who becomes a joint holder by addition of his name, will not be permitted to be repatriated outside India even if he becomes a non-resident sole (or first named) holder by succession or by way of gift or any other transfer under due process of law.
(2) a citizen of India, who is resident in India and holds any securities issued or registered in India, to convert his holding into a joint holding, by addition of the name(s) of any person(s) of Indian nationality or origin resident outside India, subject to the conditions that -
(a) the resident holder continues to be the first holder;
(b) the joint holding is treated as non-resident holding in the books of the company;
(c) any dividend or income or sale proceeds, as and when it becomes payable to the non-resident joint holder(s), shall be credited to the Ordinary Non-resident Rupee Account(s) of such person(s);
and
(d) the securities shall not be sold or disposed of, otherwise than in the stock market through a member of a recognised Stock Exchange in India, except with the previous permission of the Reserve Bank.
Explanation: A person (not being a citizen of Pakistan or Bangladesh), shall be deemed to be of Indian origin, if -
(i) he, at any time, held Indian passport;
or
(ii) he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955);
or
(iii) that person is the spouse of an Indian citizen or of a person of Indian origin (not being a citizen of Pakistan or Bangladesh).
Notification No. F.E.R.A.149/93-RB dated 26th April 1993
Sale/Transfer of Shares/Bonds/Debentures by NRIs
on Non-repatriation basis through Stock Exchange
In exercise of the powers conferred by sub-section (6) of Section 19 of the Foreign Exchange Regulation Act, 1973 (46 of 1973), the Reserve Bank being of the opinion that it is necessary and expedient in the public interest so to do, hereby exempts from the operation of the provisions of sub-section (5) of the said section, transfer of any share, bond or debenture of a company registered in India made by a person who is a citizen of India or a person of Indian origin and resident outside India, in favour of a person who is a citizen of India or a person of Indian origin and resident in India or in favour of a company or a body corporate incorporated under any law in force in India.
Provided that - (i) such share, bond or debenture is purchased by the transferee from the stock market through a member of a recognised Stock Exchange in India;
and
(ii) he proceeds of such transfer are credited to the ordinary non-resident rupee account of the transferor with a bank with no right of repatriation outside India.
Explanation: A person (not being a citizen of Pakistan or Bangladesh),shall be deemed to be of Indian origin, if
(i) he, at any time, held Indian passport;
or
(ii) he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955);
or
(iii) that person is the spouse of an Indian citizen or of a person of Indian origin (not being a citizen of Pakistan or Bangladesh).