12 December 2012

FEMA / RBI Update

Authored by: Pinaki, Manu, Vijaya and Lingamurthy |

Below is the extract of the FEMA / RBI update based on A.P. (DIR Series) Circular No. 55 dated November 26, 2012: Liaison Office (LO) / Branch Office (BO) in India by Foreign Entities – Reporting to Income Tax Authorities.

  • Attention of Authorised Dealer Category – I banks is invited to A.P. (DIR Series) Circular No. 24 dated 30.12.2009 in terms of which LOs/BOs are required to furnish copy of the Annual Activity Certificate (AAC) to Director General of Income Tax (International Taxation), Drum Shaped Building, I.P. Estate, New Delhi 110002.
  • It is clarified that copies of the AACs submitted to the DGIT (International Taxation) should be accompanied by audited financial statements including receipt and payment account.
  • Further, at the time of renewal of permission of LOs by AD banks, they may note to endorse a copy of each such renewal to the office of the DGIT (international Taxation).
  • AD Category – I banks may bring the contents of this circular to the notice of their constituents/customers concerned and ensure compliance.
  • The directions contained in this circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.

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