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Income Tax Clearance Certificate/ No Objection Certificate
A.P.
(DIR Series) Circular No. 27 dated 28th September 2002
Attention
of Authorised Dealers is invited to the Notification F. No. 500/ 152/ 96 - FID
dated November 18, 1997, issued by the Central Board of Direct Taxes (copy
enclosed) in terms of which a person making remittance of foreign exchange could
submit an undertaking in duplicate addressed to the Assessing Officer, which
should be signed by a person authorised to sign the Income Tax Return of the
applicant together with a certificate in duplicate from the Accountant.
2.
Accordingly, authorised dealers are advised that they may accept an
undertaking made in accordance with the Notification dated November 18, 1997,
referred to above, in lieu of an �Income Tax clearance Certificate� or a
�No Objection Certificate� as prescribed in the respective Notifications and
related circulars issued under Foreign Exchange Management Act, 1999 and allow
remittance of foreign exchange.
3.
It is clarified that in case of NRIs/ PIOs who do not maintain NRO
account and have no taxable income in India, authorised dealers may allow
remittances after obtaining a simple declaration from them, as per the procedure
prescribed in A.P. (DIR Series) Circular No. 26 dated September 28, 2002.
4.
Authorised Dealers may bring the contents of this Circular to the notice
of their constituents concerned.
5.
The directions contained in this circular have been issued under Section
10(4) and Section 11(1) of the Foreign Exchange Management Act 1999 (42 of
1999).
Circular
No. 759 dated 18th
November 1997
F.
No. 500/ 152/ 96 - FTD
Ministry
of Finance
Department
of Revenue
Central
Board of Direct Taxes
REGARDING
REMITTANCE TO A NON-RESIDENT � DEDUCTION OF TAX AT SOURCE - SUBMISSION OF NO
OBJECTION CERTIFICATE � DISPENSING WITH
1.
Section 196 of the Income-tax Act, 1961 provides that any person
responsible for paying to a non-resident any sum chargeable under the Act shall,
at the time of credit of such income to the account of the payee or at the time
of repayment thereof in cash or by cheque or draft or any other mode, whichever
is earlier, deduct income-tax thereon at the rates in force.
2.
The Reserve Bank of India have provided in their Office Manual that no
remittance shall be allowed unless a No Objection Certificate has been obtained
from the Income-tax Department. It has since been decided that henceforth
remittances may be allowed by the Reserve Bank of India without insisting upon a
No Objection Certificate from the Income-Tax Department and on the person making
the remittance furnishing an undertaking (in duplicate) addressed to the
Assessing Officer accompanied by a certificate from an Accountant (other than an
employee) as defined in the explanation below Section 288 of the Income-tax Act
1961 in the form annexed to this circular. The person making the remittances
shall submit the undertaking along with the said certificate of the Accountant
to the Reserve Bank of India, who in turn shall forward a copy thereof to the
Assessing Officer.
3.
The contents of this Circular may be brought to the notice of all the
officers working in your charge.
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