mayankpatel802002 (CA Practice ) (28 Points)
20 May 2011Dear professional Colleague
My question is whether NRI director( Nationality: indian) who brings money by way of director contribution (50%) and by way of loan to company- is it allowable to repatriate loan ammount which he had given previously to pvt ltd.
if possible by what means? pl suggest
CS Bijoy
(Expert)
(6394 Points)
Replied 20 May 2011
Foreign investment in India is restricted to a certain limit which you can get from the FEMA act 1999.If the limit exeed the director is not able to contribute such percentage, but if thelimit does not exeed the Director can bring such contribution, but only after obtaining the approval of RBI.
There are several limit for several sector. Currently, foreign companies are only allowed to own 10% of a business in the retail sector. Prime Minister Manmohan Singh is trying to convince his coalition partners to open up FDI along the lines of what is allowed in other industries. FDI limits for other sectors are as follows:
valji
(Accounts manager-MBA)
(2150 Points)
Replied 20 May 2011
what are the limit for manufacturing company & what happen if director bring extra money wtherther it will refunable to director ,for this refund any rbi permission is required
CA. Anuj Gupta
(Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA)
(7024 Points)
Replied 24 May 2011
| Originally posted by : mayankpatel802002 | ||
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Dear professional Colleague My question is whether NRI director( Nationality: indian) who brings money by way of director contribution (50%) and by way of loan to company- is it allowable to repatriate loan ammount which he had given previously to pvt ltd. if possible by what means? pl suggest |
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Kindly specify whether the loan is in foreifn currency or Indian rupees.
Also have you complied with FEMA regulations for investment in Indian company by NRI.
Anuj
0-9810106211
CA. Anuj Gupta
(Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA)
(7024 Points)
Replied 24 May 2011
| Originally posted by : valji | ||
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what are the limit for manufacturing company & what happen if director bring extra money wtherther it will refunable to director ,for this refund any rbi permission is required |
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Hi Valji,
Kindly specify what items shall the Indian Co. shall manufacture. Also loan from Directors is in Indian Rupees or Dollars.?
valji
(Accounts manager-MBA)
(2150 Points)
Replied 24 May 2011
for example food manufacturing company , As per my knowledge for Rs loan there is not any permission frm RBi but for dollaer loan we have to follow ECB guideline
The question is when NRI director send extra money towards share capital ,whether this should money is refundable ,in what time
whether comapny is allow to kept this money for loang time treating extra money is Loan from director
CA. Anuj Gupta
(Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA)
(7024 Points)
Replied 30 June 2011
| Originally posted by : valji | ||
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for example food manufacturing company , As per my knowledge for Rs loan there is not any permission frm RBi but for dollaer loan we have to follow ECB guideline The question is when NRI director send extra money towards share capital ,whether this should money is refundable ,in what time whether comapny is allow to kept this money for loang time treating extra money is Loan from director |
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There are certain requirements from RBI even in case of rupee loan from NRI.
The extra money should be refunded with in 180 days of receipt of same.
The Company cannot do so.
Anuj
0-9810106211
valji
(Accounts manager-MBA)
(2150 Points)
Replied 01 July 2011
tahnks for information for 180 days but it will be very helpful if you provide me RS loan requirement
it also beneficaial to other CCI memebers
Thanks in advance
CA. Anuj Gupta
(Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA)
(7024 Points)
Replied 01 July 2011
Under FEMA Regulations, Indian companies are allowed to borrow from NRIs/ PIOs in rupees both on repatriation as well as non-repatriation basis but only in the form of Non-Convertible Debentures (NCDs) subject to certain conditions.
valji
(Accounts manager-MBA)
(2150 Points)
Replied 04 July 2011
STILL I AM NOT CLEAR IF PRIVATE LIMITED COMPANY TAKEN RUPEES LOAN FROM NRO ACCOUNTS FROM NRI DIRECTOR THEN RBI PERMISSION IS NECESSRY ( UNSECURED LOAN)
PLEASE GIVE ME CIRCULAR FOR THIS REFERANCE BEACUSE IN THIS CASE NOT ANY FOREIGN EXCHANGE INVOLVE
CA. Anuj Gupta
(Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA)
(7024 Points)
Replied 04 July 2011
As per Regulation 3 "no person resident in India shall borrow in rupees from, a person resident outside India"of Foreign Exchange Management (Borrowing and Lending in Rupees) Regulations, 2000 .
Also regulation 5provides that"a company incorporated in India may borrow in rupees on repatriation or non-repatriation basis, from a non-resident Indian or a person of Indian origin resident outside India , by way of investment in Non-convertible Debentures (NCDs) subject to certain conditions"
Anuj
0-9810106211
MR. MEHTA
(CA)
(22 Points)
Replied 30 April 2012
DEAR GUPTA SAB, PL. TRHOUGH SOME LIGHT ON THIS: iF THERE IS PVT. LTD. COMPANY AND IT IS GETTING LOAN FROM NRI SHARE HOLDER IN RUPPES, THEN IS THERE ANY RESTIRCTIONS WITH POINT TO RBI?
Prashant Chavan
(Business Developer)
(24 Points)
Replied 14 August 2012
Hi,
My self prashant chavan, sir my company is Pvt. Ltd (IT)company. One of my friend want to invest in my company, but he don’t have Indian passport, and he stay in London. Can he invest his money in my company? And how?
CAclubindia
