RBI/2013-14/440
A.P. (DIR Series) Circular No. 90
January 9, 2014
To,
All Category- I Authorised Dealer Banks and Authorised Banks
Madam / Sir,
Provisions under section 6 (4) of Foreign Exchange Management Act, 1999 -
Clarifications
Attention of Authorized Dealers is invited to Section 6 (4) of FEMA, 1999 in
terms of which a person resident in India may hold, own, transfer or invest in
foreign currency, foreign security or any immovable property situated outside
India if such currency, security or property was acquired, held or owned by such
person when he was resident outside India or inherited from a person who was
resident outside India.
- We have been receiving representations with regards to nature of transactions
covered under Section 6(4) of FEMA, 1999. In this regard it is clarified that
Section 6(4) of FEMA, 1999 covers the following transactions:
Foreign currency accounts opened and maintained by such a person when he was
resident outside India;
Income earned through employment or business or vocation outside India taken up
or commenced while such person was resident outside India, or from investments
made while such person was resident outside India, or from gift or inheritance
received while such a person was resident outside India;
Foreign exchange including any income arising therefrom, and conversion or
replacement or accrual to the same, held outside India by a person resident in
India acquired by way of inheritance from a person resident outside India.
A person resident in India may freely utilise all their eligible assets abroad
as well as income on such assets or sale proceeds thereof received after their
return to India for making any payments or to make any fresh investments abroad
without approval of Reserve Bank, provided the cost of such investments and/ or
any subsequent payments received therefor are met exclusively out of funds
forming part of eligible assets held by them and the transaction is not in
contravention to extant FEMA provisions.
- Authorised Dealer Category – I banks may bring the contents of this circular
to the notice of their constituents and customers concerned.
- The directions contained in this circular have been issued under Section
10(4) and Section 11(1) of the FEMA, 1999 (42 of 1999) and are without prejudice
to permissions/approvals, if any, required under any other law.
Yours faithfully,
(Rudra Narayan Kar)
Chief General Manager-in- Charge