Sale proceeds received and spent in foreign bank account

[chandrashekar Mahadevappa]

Hi All,

Need your guidance on the below issue:

A software company has a branch office in USA for sales and marketing. The USA branch office holds a bank account for payment of salaries and other expenses.

The company received payments from customers in to the foreign bank account. The company used a small portion of such receipts towards salaries and other expenses in USA.

Please let me know the implications under FEMA since the export proceeds were used in USA without bringing the money in to India.

AI Summary

Software Company Queries FEMA Implications for Using Export Proceeds in USA Without Repatriation to India A software company with a branch office in the USA receives payments from customers into its foreign bank account. This account is used for paying salaries and other expenses in the USA. The query seeks guidance on the implications under the Foreign Exchange Management Act (FEMA) for using export proceeds in the USA without repatriating the funds to India. The response suggests that more details are needed, such as whether the customers are Indian and whether the services provided by the foreign branch are rendered in India.