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In these
Regulations, unless the context requires otherwise, -
(i) 'Act' means the FEMA,
1999 (42 of 1999);
(ii) 'Authorised
Dealer' means a person authorised under the Act;
(iii)
‘NRI’
& ‘PIO’ shall be as defined in Foreign
Exchange Management (Deposit) Regulations, 2016;
(iv)
'Remittance
of asset' means remittance outside India, deposit with a bank or a firm or a
company, provident fund balance or superannuation benefits, amount of claim or
maturity proceeds of Insurance policy, sale proceeds of shares, securities,
immovable property or any other asset held in India as per the Act or rules or
regulations made there under;
Prohibition on
Remittance outside India of assets held in India:-
No
person, whether resident in India or not, shall make remittance of any asset held
in India except for what is provided in the Act or special permission of RBI:
(1)
A
citizen of a foreign state, other than a PIO or a citizen of Nepal or Bhutan,
who
(i)
has
retired from an employment in India, or
(ii)
has
inherited the assets from a person referred to in the Act; or
(iii)
is
a widow/ widower resident outside India and has inherited assets of the
deceased spouse who was a resident Indian citizen. He/She may remit upto USD
1,000,000/- per financial year on production of documentary evidence. For the
purpose of arriving at the annual ceiling, the sale proceeds of shares and
immovable property owned or held by the citizen of foreign state on
repatriation basis, shall not be included.
Where
the remittance is made in more than one instalment, it shall be made through
the same authorised dealer.
(iv)
had
come to India for studies, may remit the balance available in his account after
the studies are over. The balance should represent inward remittances or stipend/
scholarship received from the Government or any Organisation in India.
(2)
A
NRI or PIO may remit upto USD 1,000,000 per financial year,
(i) out of the
balances held in the NRO accounts / sale proceeds of assets/ inherited assets/
legacy;
(ii)
Under
a deed of settlement made by either of his parents or a relative and the
settlement taking effect on the death of the settler;
Where
the remittance is made in more than one instalment, it shall be made through
the same authorised dealer.
Where
the remittance is to be made from the balances held in the NRO account, the
account holder shall furnish an undertaking that “the said remittance is sought
to be made out of the remitter’s balances held in the account arising from his/
her legitimate receivables in India and not by borrowing from any other person
or a transfer from any other NRO account and if such is found to be the case,
the account holder will render himself/ herself liable for penal action under
FEMA.”
(3)
An authorised dealer in India may, also allow remittance out of the assets of
Indian companies under liquidation under the provisions of the Companies Act,
2013, subject to the following conditions:
(i)
Authorised
Dealer shall ensure that the remittance is in compliance with the court order
in India/ order of the official liquidator or the liquidator in the case of
voluntary winding up; and
(ii)
no
remittance shall be allowed unless the applicant submits:-
(a) Auditor's
certificate confirming that all liabilities in India have been either fully
paid or adequately provided for.
(b) Auditor's
certificate to the effect that the winding up is in accordance with the
provisions of the Companies Act, 2013.
(c) In case of
winding up otherwise than by a court, an auditor's certificate to the effect
that there is no legal proceedings pending in any court in India against the
applicant or the company under liquidation and there is no legal impediment in
permitting the remittance.
Permission to an
Indian entity to remit funds in certain cases:-
(1)
An entity in India may remit its contribution towards the provident fund/
superannuation/ pension fund of the expatriate staff who are resident in India
but not permanently resident therein.
For the purpose
of this Regulation, -
(a)
'expatriate
staff' means a person whose provident/ superannuation/ pension fund is
maintained outside India by his principal employer outside India;
(b)
‘not
permanently resident' means a person resident in India for employment of a
specified duration (irrespective of length thereof) or for a specific job or
assignment, the duration of which does not exceed three years.
Permission
for remittance of assets on closure or remittance of winding up proceeds of
branch office/ liaison office (other than project office)
(1)
A branch or office established in India by a non resident may apply to the
Authorised Dealer, for making remittance of assets on closure or on winding up,
supported by the following documents, namely:
(A)
A
copy of the Reserve Bank's permission for establishing the branch/ office in
India, for making remittance of assets on closure or on winding;
(B)
Auditor’s
certificate:
(i)
indicating
the manner in which the amount has been arrived and supported by a statement of
assets and liabilities of the applicant, and indicating the manner of disposal
of assets;
(ii)
confirming
that all liabilities in India, have been either fully met or adequately
provided for;
(iii)
confirming
that no income accruing from sources outside India (including proceeds of
exports) has remained un-repatriated to India; and
(iv)
confirming
that the branch has complied with all regulatory requirements stipulated by the
RBI.
(C)
A
confirmation from the applicant that no legal proceedings are pending in any
Court in India and there is no legal impediment to the remittance; and
(D)
A report from the Registrar of Companies regarding compliance with the
provisions of the Companies Act, 2013, in case of winding up of the office in
India.
(2)
On consideration of the application, the authorized dealer may permit the
remittance subject to the directions of RBI.
Reserve
Bank's prior permission in certain cases:-
(1)
A
person who desires to make a remittance of assets in the following cases, may
apply to the Reserve Bank, namely:
(i)
Remittance
exceeding USD 1,000,000 per financial year –
(a)
on
account of legacy, bequest or inheritance to a citizen of foreign state,
resident outside India; and
(b)
by
a NRI or PIO, out of the balances held in NRO accounts/ sale proceeds of
assets/ the assets acquired by way of inheritance/ legacy.
(ii)
Remittance to a person resident outside India on the ground that hardship will
be caused to such a person if remittance from India is not made;
(2)
On consideration of the application, the Reserve Bank may permit the remittance.
Payment of
taxes:-
Any remittance of
assets under these regulations shall be subject to the applicable tax laws in
India.
Based on the RBI circular dated 1st
April 2016. For further any clarifications please refer www.rbi.org.in ……………. Poppy
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