Circualar Updation

Transfer of funds from NRO account to NRE Account –

RBI, vide AP (DIR Series) Circular no 106 dated 18.02.2014 had modified the periodicity of reporting remittances made by NRIs / PIOs / Foreign Nationals out of the NRO from Quarterly to Monthly

Data on Transfers from NRO to NRE account is t in addition to outward remittances on account of sale of immovable property and other assets abroad from NRO accounts.

Any person resident in India

i) may take outside India (other than to Nepal and Bhutan) currency notes of Government of India and Reserve Bank of India notes up to an amount not exceeding Rs.25,000 (Rupees twenty five thousand only); and ii) who had gone out of India on a temporary visit, may bring into India at the time of his return from any place outside India (other than from Nepal and Bhutan), currency notes of Government of India and Reserve Bank of India notes up to an amount not exceeding Rs.25,000 (Rupees twenty five thousand only). Any person resident outside India, not being a citizen of Pakistan and Bangladesh and also not a traveler coming from and going to Pakistan and Bangladesh, and visiting India may take outside India currency notes of Government of India and Reserve Bank of India notes up to an amount not exceeding Rs. 25,000 (Rupees twenty five thousand only) while exiting only through an airport may bring into India currency notes of Government of India and Reserve Bank of India notes up to an amount not exceeding Rs. 25,000 (Rupees twenty five thousand only) while entering only through an airport

Foreign Account Tax Compliance Act – FATCA Key areas for consideration:

1. Identification of all US accounts

2. KYC documentation of US account holder records

3. Obtaining waiver from account holders and closure of “Bad Accounts”.The identification of US accounts is required in respect of all new accounts opened on or after July 1, 2014

Identification in respect of all pre-existing accounts as on June 30, 2014 is required to be done by June 30, 2016 except for high value individual accounts, which needs to be done by June 30, 2015.

SUB: APPLICABILITY OF FORM 15 CA &15 CB ON PAYMENTS MADE TO NON RESIDENTS- CBDT REVISED DIRECTIONS

(i) .the information in Part A of Form No.15CA, if the amount of payment does not exceed fifty thousand rupees and the aggregate of such payments made during the financial year does not exceed two lakh fifty thousand rupees. (ii). the information in Part B of Form No.15CA for payments other than the payments referred in clause (i) after obtaining: The information in Form No. 15CA shall be furnished by the person electronically to the website designated by the Income-tax Department and thereafter signed printout of the said form shall be submitted to the authorized dealer, prior to remitting the payment. An income-tax authority may require the authorized dealer to furnish the signed printout referred to in sub-rule (2) for the purposes of any proceedings under the Act. Please note that for all remittances exceeding Rs.50, 000/- for all outward remittances including for Import purposes (including Advance Payments) as well as items not mentioned in the specified list branches should obtain Form 15CA duly completed in Part B & Form 15CB or other documents mentioned in rule

Annexure to CO: ID circular 19/ 2014-15 dated 21.08.2014 contains 28 items for which submission of 15CA/CB is not required

 RE-INTRODUCTION OF PENALTY FOR PRE-MATURE WITHDRAWAL OF NRE AND NRO ERM DEPOSITS AND EXERCISE OF DISCRETION TO DISALLOW FORECLOSURE OF LARGE VALUE TERM DEPOSITS  Deposits Up to Rs.15 Lakhs -  No penalty to be levied for pre closure of deposits i.e.eligible interest rate will be the applicable card rate for the actual period run prevailing on the date of deposit Deposit above Rs 15 Lakhs – Applicable card rate for the actual period run prevailing on the date of deposit less 0.75% per annum as fore closure charges

Premium on WT Packing Credit is charged to the account holder and in case of WT Post Shipment credit it is borne by the Bank

  While renewing the policy for the current year from 01.07.2014

to 30.06.2015, ECGC has put certain new conditions besides increasing the premium payable on the WTPC & WTPS covers.

  1. The rate of premium has been increased from 6 paise per Rs

100 per month to 6.5 paise per Rs 100 per month with effect from 01.07.2014. Bank also needs to cover all its Pre- shipment advances granted to all its export clients including Government Companies, by OBU under WTPC. In other words no exclusion is permitted under the WTPC cover.

  2. It has raised premium rate for Post Shipment category to 13.5

paise per Rs 100/- per month from 5.50. paise paid as per last policy.

SUB: OPENING OF FCNR (B) ACCOUNT THROUGH EXCHANGE OF CURRENCY

    FCNR (B) accounts can be opened by

a).Inward remittance in convertible currency received in the name of Depositor b).By transfer from NRE account maintained in the name of depositor and c) through conversion of foreign currency notes brought by the depositor on his

temporary visit to India  While encashing /converting foreign currency notes where the value of foreign

currency alone exceeds USD 5,000 or its equivalent, it should have been declared to the Customs Authorities at the Airport in the Currency Declaration Form (CDF), on arrival in India

The charges incurred for obtaining the Foreign demand draft or transfer to our Nostro account should be borne by the Depositor only and not paid by the Bank. RBI during their annual inspection have taken strong exception to non adherence of guidelines by the branches.

  As per ECIB WT packing credit, the liability

of ECGC ceased once bill are submitted to the bank, irrespective of whether the bank has sent the bills under collection or purchase or negotiation. Hence branches should convert pre-shipment pay premium even bills sent on collection. Otherwise coverage will not be available

  Renewal of ECGC coverage from 01.07.2014-30.6.2015   Coverage for ECIB Packing Credit   For losses upto Rs 612.94 lakhs – 75% For losses beyond Rs 612.94 lakhs – 65%   However in respect of small exporters – turnover not exceeding Rs 50

lakhs -90%   The maximum amount upto which ECGC will pay claim under PC during

one ECIB year is Rs 350 Crores   Post Shipment Credit   Non – Policy Holders – 50%   Policy Holders   – cover for bills drawn on Non-associates – 75% Cover for bills drawn on associates – 50%     The maximum amount upto which ECGC will pay claim under PS during

one ECIB year is Rs 110Crores

Effective From 01 Apr 2015

Valid for 5 years

MEIS SEIS

Duty Scrip / Transferable / Payment of Import Duty

Review after 30 months

All previous incentives scrapped

One Star - USD 3 mio

Two Star - USD 25 mio

Three Star - USD 100 mio

Four Star - USD 500 mio

Five Star - USD 2000 mio

Double weightage for MSME – only one star status

Classification of Export Finance

ANY MODE OF TRANSPORT (SEA, TRUCK, AIR, RAIL)

SEA & WATERWAY TRANSPORT ONLY

• (CIP) Carriage and Insurance Paid

• (CPT) Carriage Paid To• (DAT) Delivered At Terminal• (DAP) Delivered At Place• (DDP) Delivery Duty Paid• (EXW) Ex Works• (FCA) Free Carrier

• (CFR) Cost of goods and

Freight• (CIF) Cost, Insurance and

Freight• (FAS) Free Alongside Ship• (FOB) Free On Board