FEMA relaxed to acquire Real Estate outside India

By Accommodation Times News Services

rbiReserve Bank of India (RBI) has issued guidelines regarding the Liberalised Remittance Scheme (LRS) for Resident Individuals a scheme to relax Foreign Exchange Management Act (FEMA). Bank has increased the limit to USD 125,000 per financial year from USD 75,000.

The circular A.P. (DIR Series) No. 5 was issued dated 17.07.2014, according to it banks have been allowed to remit up to USD125,000 per financial year, under the Scheme, for any permitted current or capital account transaction or a combination of both. Further, it is clarified that the Scheme can now be used for acquisition of immovable property outside India.

The circular is as below:

 

RBI/2014-15/132                                                                                                                       July 17, 2014

A.P. (DIR Series) Circular No.5

To

All Category – I Authorised Dealer Banks

Madam/ Sir,

Liberalised Remittance Scheme (LRS) for resident individuals-Increase in the limit from USD 75,000 to USD 125,000.

Attention of Authorised Dealer Category-I (AD Category-I) banks is invited to theguidelines regarding the Liberalised Remittance Scheme (LRS) for Resident Individuals (the Scheme).

2. It was decided vide A.P.(DIR Series) Circular No. 138 dated June 3, 2014, to increase the limit to USD 125,000 per financial year (April-March) from USD75,000. Accordingly, AD Category –I banks have been allowed to remit up to USD125,000 per financial year, under the Scheme, for any permitted current or capital account transaction or a combination of both. Further, it is clarified that the Scheme can now be used for acquisition of immovable property outside India.

3. All other terms and conditions mentioned in A.P.(DIR Series) Circular No. 64, dated February 4, 2004, A.P.(DIR Series) Circular No. 24 dated December 20, 2006, A.P.(DIR Series) Circular No.51 dated May 8, 2007, A.P.(DIR Series) Circular No.36 dated April 4, 2008, A.P.(DIR Series) Circular No.17 and 18 both dated September 16, 2011, A.P.(DIR Series) Circular No.106 dated May 23, 2013, A.P.(DIR Series) Circular No.24 dated August 14, 2013 and A.P.(DIR Series) Circular No. 138 dated June 3, 2014, shall remain unchanged.

4. Reserve Bank has since amended the Principal Regulations through the Foreign Exchange Management (Permissible Capital Account Transaction) (Amendment) Regulations, 2014 notified vide Notification No. FEMA 311/2014-RB dated June 24, 2014 c.f. G.S.R. No. 488 (E) dated July 11, 2014.

5. AD-Category I banks may bring the contents of this circular to the notice of their constituents and customers concerned.

6. The directions contained in this Circular have been issued under Section 10(4) and 11(1) of the Foreign Exchange Management Act, 1992 (42 of 1999) and are without prejudice to permissions/approvals, if any, required under any other law.

Yours faithfully,

(C. D. Srinivasan)

Chief General Manager





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