RBI/2011-12/226
A.P. (DIR Series) Circular No. 37
October 19, 2011
To,
All Banks Authorised to Deal in Foreign Exchange
Madam / Sir,
(i) Repatriation of income and sale proceeds of
assets held abroad by NRIs who have returned to India for permanent settlement
(ii) repatriation of income and sale proceeds of assets acquired abroad through
remittances under Liberalised Remittance Scheme - Clarification
Attention of the Authorised Dealer (AD) banks is invited to sections 6(4) of
the Foreign Exchange Management Act (FEMA), 1999. Further, the attention of AD
banks is also invited to section 8 of FEMA, 1999 which states that save as
otherwise provided in this Act, where any amount of foreign exchange is due or
has accrued to any person resident in India, such person shall take all
reasonable steps to realize and repatriate to India such foreign exchange within
such period and in such manner as may be specified by the Reserve Bank.
- The Committee to Review the Facilities for Individuals under FEMA, 1999
has suggested in its Report that necessary clarifications may be issued
forthwith clarifying the position that income and sale proceeds of assets held
abroad by NRIs who have returned to India for permanent settlement and income
and sale proceeds of assets held abroad through remittances under LRS need not
be repatriated.
- Accordingly, it is clarified as under:
- in terms of sub-section 4 of Section (6) of FEMA, 1999, a person resident in
India is free to 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.
- an investor can retain and reinvest the income earned on investments made
under the Liberalised Remittance Scheme.
- AD banks may bring the contents of this circular to the notice of their
constituents/customers concerned.
Yours faithfully,
(Meena Hemchandra)
Chief General Manager-in-Charge