Export invoice in inr- consequences and further procedure
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
23 November 2013
My client is a manufacturing unit and recently accepted a purchase order from abu dhabi(UAE) in INR. we have to make invoice in INR. please advice whether there is any voilation of FEMA and in which currency we have to recieve payment and have we face any problem related to shipment,custom clearance,documentation and dealing with bank? please advice me ASAP as this is very urgent.
23 November 2013
There is nothing wrong in raising an export invoice in INR. Only thing is you must ensure your overseas customer pays in INR to square off the invoice. No FEMA violations.
Querist : Anonymous
Querist :
Anonymous
(Querist)
25 November 2013
Thanks Mr. P V Ram but I am confuse in this issue, as per my google seach i found that we can make invoice in INR but at the time of receipt of payment the payment shuould be in free convertible currency ( as Indian Ruppee is not a free convertible currency). please correct me if i am wrong and send me link for confirmation if available.
26 November 2013
Respected Author,
in terms of Para 2.40 of the Foreign Trade Policy (August 27, 2009 - March 31, 2014), “All export contracts and invoices shall be denominated either in freely convertible currency or in Indian Rupees but export proceeds shall be realised in freely convertible currency. However, export proceeds against specific exports may also be realised in rupees provided it is through a freely convertible Vostro account of a non-resident bank situated in any country, other than a member country of the ACU or Nepal or Bhutan”
in view of above,There is no restriction on invoicing of export contracts in Indian Rupees in terms of the Rules, Regulations, Notifications and Directions framed under the Foreign Exchange Management Act 1999
more info:
https://www.caclubindia.com/experts/brc-for-invoice-in-inr-522105.asp#.UpQdFtJkM7s
in terms of Para 2.40 of the Foreign Trade Policy (August 27, 2009 - March 31, 2014), “All export contracts and invoices shall be denominated either in freely convertible currency or in Indian Rupees but export proceeds shall be realised in freely convertible currency. However, export proceeds against specific exports may also be realised in rupees provided it is through a freely convertible Vostro account of a non-resident bank situated in any country, other than a member country of the ACU or Nepal or Bhutan”
in view of above,There is no restriction on invoicing of export contracts in Indian Rupees in terms of the Rules, Regulations, Notifications and Directions framed under the Foreign Exchange Management Act 1999
more info:
https://www.caclubindia.com/experts/brc-for-invoice-in-inr-522105.asp#.UpQdFtJkM7s
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