13 July 2012
Defintion of Person Resident in India(PRI) and a Person Resident Outside India (PROI) under FEMA
Residents & non-residents are defined under the Act as Person Resident in India (PRII) and Person Resident Outside India (PROI). The definition of “Person resident in India” is different under FEMA from that under the Income Tax Act. Section (2)(v) of the FEMA define the “Person Resident in India” (PRII) as
a person residing in India for more than one hundred and eighty-two days during the course of the preceding financial year but does not include a person who has gone out of India or who stays outside India, in either case for or on taking up employment outside India, or for carrying on outside India a business or vocation out-side India, or for any other purpose, in such circumstances as would indicate his intention to stay outside India for an uncertain period; a person who has come to or stays in India, in either case, otherwise than for or on taking up employment in India, or for carrying on in India a business or vocation in India, or for any other purpose, in such circumstances as would indicate his intention to stay in India for an uncertain period; any person or body corporate registered or incorporated in India, an office, branch or agency in India owned or controlled by a person resident outside India, an office, branch or agency outside India owned or controlled by a person resident in India; Section (2)(w) of the FEMA defines “Person resident outside India” (PROI) as a person who is not a resident in India
A PROI may invest in India in any of the following ways
Investment in the securities of a company incorporated in India (Notification 20) Establishment of branch or liaison office in India (Notification 22) Investment in the partnership business in India (Notification 24) Investment in immovable properties in India (Notification 21) Granting of loans and overdrafts to person resident in India (Notifications 3 & 4) Investment in fixed deposits or bank account in India (Notification 5)
CAclubindia
