Receipt of foreign exchange in India is called Inward remittance. Apart from exports there are other transactions, which generate inward remittance. For example Non-resident Indian staying abroad may remit foreign exchange to their relatives in India. Inward remittances are usually in the nature of foreign currency notes, foreign currency traveller cheques, foreign currency cheques / foreign currency demand drafts and inward telex transfers. Part A
Part - A
Exchange Management Regulations
1. There are no restrictions on receiving re mittances from abroad through authorised dealers in foreign exchange in India.
Persons resident in India are also permitted to receive directly from persons resident outside India foreign exchange in the form of bank drafts or traveller’s cheques issued outside India or cheques drawn on banks situated outside India provided the instruments so received are surrendered to an authorised dealer in foreign exchange in India within a period of seven days from date of receipt.
Persons resident in India are also permitted to receive from any person resident outside India and who is on a visit to India payment in foreign currencies for services rendered or in settlement of any lawful obligations - subject to the condition that the foreign currencies so received will be surrendered to an authorised dealer in foreign exchange within seven days of receipt.
(Note: General permission has been given by RBI to persons resident in India to retain with them foreign currency up to the value of USD 2,000. In other words, the amount held by residents should not exceed USD 2,000 or its equivalent at any point of time. The amount, which is in excess of USD 2,000 mentioned above, must be surrendered to an authorised dealer within a period of seven days of acquisition. Needless to state that the foreign exchange mentioned above should have been acquired by the resident in conformity with the provisions of the FEMA).
Exporters in India are permitted to receive directly from the overseas buyers during their visit to India foreign exchange in the form of bank drafts, personal cheques, currency notes, pay orders, banker’s cheques and traveller’s cheques in payment of goods already exported or to be exported. The exporters must surrender these foreign currency instruments to an authorised dealer in foreign exchange in India within a period of seven days from date of receipt. Authorised dealers have been advised by RBI to treat such payments as realisation of export proceeds.
If the amount of inward remittance exceeds Rs.1,00,000 (or its equivalent in foreign exchange), then the purpose of remittance should be ascertained by the authorised dealer. This information should be reported to RBI in the supplementary statement annexed to R-Returns.
Authorised dealers should issue foreign Inward Remittance Certificate (FIRC) in the prescribed form if requested by the beneficiary.