Export of Services - Remittance recieved on personal Savings account.

[Shrivalli]

Hi everyone,

I have a query regarding RBI/FEMA regulations for software service exports by an independent consultant/sole proprietor.

Is there any RBI rule, Master Direction, FEMA regulation, or circular that specifically mandates a sole proprietor exporting software services to maintain a Current Account for receiving export proceeds?

I would like to understand whether this is an actual RBI/FEMA requirement .

Additionally, I am facing an issue with SBI regarding the purpose code in my FIRC. Since the remitter did not mention the purpose, SBI has selected P1301 (Family Maintenance) instead of the appropriate code P0802. The bank is not agreeing to amend the purpose code.

Could anyone please clarify:

• Whether RBI/FEMA allows correction of an incorrectly reported purpose code in such cases?
• Whether there is any specific RBI notification, Master Direction, or regulation preventing such amendment?
• Whether the Current Account requirement is a regulatory mandate ?

I would appreciate any relevant references or experiences.

Thank you.

AI Summary

Export receipt purpose-code correction may be supported by service evidence where banking classification wrongly records family maintenance.
Export proceeds for software services must be realised and routed through an Authorised Dealer bank, but no identified RBI/FEMA provision expressly requires a sole proprietor to use a Current Account. No identified FEMA provision or RBI notification expressly prohibits correction of an erroneous purpose code where supporting evidence establishes that the remittance relates to software export services. A mismatch between family-maintenance and software-services classification may affect export documentation and compliance. The bank should be asked in writing to record the correct purpose and cite any regulatory basis for refusing correction.