Foreign Remittance_Urgent

[Varun Arora]

Dear Experts,'

Please resolve my query.

NRI had incorporated a pvt. ltd. company and holds 99% shares of that company, share capital of rs. 10 lacs. Now He had transferred rs. 90 lacs to pvt. ltd in the year of 2011 from his NRO Account. Apart from share capital shall be treated as Loan from Directors i.e. 80 lacs. And company had purchased immovable property out of this funds.

Now in the year of 2016 Company sold out the above mentioned property amounted of rs. 95 lacs Now as per income tax provisions NO capital gain would be attracted as because after cost inflation index its cost is higher than its sale proceeds.

Now company has transferred the sale proceeds of immovable property to its director's account i.e. in NRO Account.

Now Director(NRI) wants to take it back to USA from his NRO Account But Bank is not doing the foreign remittance as banker is saying that It needs RBI Approval.

Now the question is Whether it needs RBI approval or not, if yes please suggest how to get approval from RBI and what documents i need to produce to officer.

If no then please suggest what shall i do in this regard???

Thanks alot in advance for considering query.

[Ganeshan Kalyani]

Remittance of amount above certain limits require RBI approval.

[Varun Arora]

Dear Kalyani Sir,

I think LImit is ₹ 1 Million Dollar means An NRI can remit 1 Million Dollar outside without getting RBI Approval per financial year.

But in my case amount is below this limit ??

Please suggest if i am missing any circular or Notification..

Thanks alot for your valuable suggestion.

[Ganeshan Kalyani]

Sir, pls check

RBI/2013-14/181 A. P. (DIR Series) Circular No.24 dated August 14, 2013.

AI Summary

RBI approval for foreign remittance may be required for repatriation of property sale proceeds from an NRO account. Whether RBI approval is required for repatriation of property sale proceeds credited to an NRO account is the operative issue: an NRI director advanced funds to his private company (treated as director loans), the company purchased and later sold immovable property without capital gain after indexation, transferred sale proceeds to the director's NRO account, and faces a bank refusal to remit abroad pending RBI approval, with reference to RBI DIR Series guidance.