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Remittance of Current Income by Non-Resident Indians (NRIs)/Persons of
Indian Origin (PIOs) � No Objection Certificate & Repatriation of NRNR
Deposits
A.P.
(DIR Series) Circular No. 26 dated 28th September 2002
Attention
of Authorised Dealers is invited to A. P. (DIR Series) Circular No. 45 dated May
14, 2002, in terms of which A.Ds may allow repatriation of current income like
rent, dividend, pension, interest etc. of NRIs who do not maintain NRO Account
in India based on an appropriate certification by a Chartered Accountant,
certifying that the amount proposed to be remitted is eligible for remittance
and that applicable taxes have been paid/ provided for. A doubt has been raised
as to whether Non-Resident Indians/ Persons of Indian Origin (NRIs/PIOs) seeking
to repatriate funds from India, but having no taxable income in India, are also
required to furnish a certificate as indicated in the A.P. (DIR Series) Circular
No. 45 dated May 14, 2002.
2. It is, therefore, clarified that such NRIs/ PIOs who do not maintain NRO
Account and have no taxable income in India need not submit a Chartered
Accountant�s certificate for remitting their current income like dividend,
rent, pension, interest etc. In such cases Authorised Dealers may obtain a
simple declaration, in duplicate, from the NRIs/ PIOs to the effect that he/ she
is not a taxpayer in India. The Authorised Dealer may retain such declaration
with them for future reference from Income Tax Authorities, if any. Crediting of
current income to non-resident accounts
3.
Attention of Authorised Dealers is also invited to A.P. (DIR Series)
Circular No. 5 dated July 15, 2002 wherein it has been clarified that Authorised
Dealers may credit the current income to the NRE accounts of NRIs provided they
are satisfied that the credit represents current income of the non-resident
account holder and income tax thereon has been deducted/ paid/ provided for, as
the case may be.
4. It is clarified that in terms of item 3 (B)(ii) of Schedule 3 to
Notification No. FEMA 5/ 2000 RB dated May 3, 2000 for remitting current income
credited to NRO A/c, as well as for crediting current income to NRE Account of
the NRI in terms of clarifications given in A.P. (DIR Series) Circular No. 5
dated July 15, 2002, requirement of submission of income tax declaration/
Chartered Accountant�s certificate stating that the income-tax thereon has
been deducted/ paid/ provided for, is applicable. In case NRIs/ PIOs have no
taxable income in India, the procedure indicated in paragraph No.2 above may be
followed.
MATURITY
PROCEEDS OF NRNR DEPOSITS
5.
Authorised Dealers may also refer to A.P. (DIR Series) Circular No. 28
dated March 4, 2002 in terms of which maturity proceeds of NRNR deposits should
be credited to NRE accounts. It is clarified that proceeds of the NRNR deposit
on maturity may be allowed to be repatriated outside India in case the
accountholder does not maintain NRE account.
6.
Authorised Dealers may bring the contents of the circular to the notice
of their constituents concerned.
7.
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).
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