Investment in aboard

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

13 September 2011 Dear Experts pl clarify the following

One of my client NRI by status, is selling his property in India, and he wants to transfer the amount to Singapore where he resides and doing business, after paying the capital gains tax on such sale,
Now pl tell me, is there any limit for the amount to be trf?
and what is the procedure to be followed?

pl clarify

CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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14 September 2011 Yes as per FEMA there is limit of 1 million US Dollars.

Anuj
+91-9810106211
femaquery@gmail.com

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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15 September 2011 Reserve Bank of India, under the “Liberalized Remittance Scheme for Resident Individuals” permits resident individual to remit up to US $ 100,000 per financial year for any permitted current or capital account transactions or a combination of both, such as bank deposits, purchase of immovable property, investment in equity and debt abroad. Similarly, resident individuals are permitted to remit for current account transactions such as gift, donation, medical treatment, education, employment, emigration, import of medicines, books and periodicals subject to foreign trade policy.

Indian corporates / Registered partnership firms are allowed to undertake agricultural activities either directly or through an overseas branch.

The stipulation of minimum net worth of Rs. 15 crores for Indian companies engaged in financial sector activities in India removed for investment abroad in the financial sector. However, an Indian party seeking to make investment in an entity engaged in the financial sector should also fulfill the following additional conditions:

be registered with the appropriate regulatory authority in India for conduction the financial sector activity;

have earned net profit during the preceding three financial years from the financial service activities;

have obtained approval for investment in financial sector activities abroad from regulatory authorities concerned in India and abroad; and

have fulfilled the prudential norms relating to capital adequacy as prescribed by the regulatory authority concerned in India .
Further liberalisation measures introduced in the fiscal year 2005-06 are as follows:-

Guarantees:- the scope of guarantee has been enlarged under the automatic route. Indian entities may offer any forms of guarantee i.e. corporate or personal/ primary or collateral/ guarantee by the promoter company/ guarantee by group company, sister concern or associate company in India , provided that: -

All "financial commitments" including all forms of guarantees are within the overall prescribed ceiling for overseas investment of the Indian party i.e. currently within 300% of the net worth of the investing company;

No guarantee is ‘open ended' i.e. the amount of the guarantee should be specified upfront; and

As in the case of corporate guarantees, all guarantees are required to be reported to Reserve Bank of India (RBI), in Form ODR.

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CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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15 September 2011 Liberalized Remittance Scheme is only for Resident Individuals and not for Non resident Individuals.

Anuj
+91-9810106211
femaquery@gmail.com