Implication of FEMA and other Acts for to open a Product Development Centre outside India.

[LAVA INTERNATIONAL LTD LAVA INTERNATIONAL LTD]

Hi, We want to open a Product Development Centre outside India, it only involve costs like -Manpower Cost (Salaries and Reimbursements) - Rental Cost for Office - Misc Admin Costs The office does not generate any kind of revenue. Pls advise implication of FEMA and other Acts for this nature of transaction as we will be required to remit money for this. Regards

AI Summary

LAVA International explores setting up overseas Product Development Centre under FEMA; requires notifying Authorized Dealer. Income Tax details pending. LAVA International Ltd inquired about the implications of the Foreign Exchange Management Act (FEMA) and other regulations for establishing a Product Development Centre outside India, which would incur costs like salaries, office rent, and administrative expenses without generating revenue. An expert advised that FEMA permits this activity, requiring only notification to the Authorized Dealer (AD) for such transactions. For implications under the Income Tax Act, detailed information on the specific transactions of the overseas centre is necessary.